TSX backs off highest level in 13 months as energy stocks weigh

Wed Aug 10, 2016 5:10pm EDT
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By Alastair Sharp

TORONTO (Reuters) - Canada's main stock index on Wednesday broke a five-day winning streak that had lifted it to a 13-month high, with heavyweight energy and financial stocks leading a broad pullback as oil prices fell.

Gains for gold miners helped limit losses, as bullion rose with a weaker U.S. dollar.

The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE ended down 26.19 points, or 0.18 percent, at 14,775.04.

Early in the session the index touched its highest point since mid-June last year, but reversed course after inventory data dragged down crude prices.

The energy sector lost 0.5 percent, with Cenovus Energy Inc (CVE.TO: Quote) down 3 percent at C$18.74 and Canadian Natural Resources Ltd (CNQ.TO: Quote) off 1 percent at C$40.82.

"If I had to make a prediction for the second half it would be, given how fast the market has moved from the bottom in February, you're probably safer to gravitate back to the high dividend and yield stocks," said Luciano Orengo, a portfolio manager at Manulife Asset Management.

He was referring to sectors such as telecoms, utilities and financials, noting that their valuations have risen along with resource stocks but would suffer less in an overall retreat.

Eight of the index's 10 main groups ended in negative territory, with telecoms barely positive. Decliners outnumbered advancers by a 1.5-to-1 ratio overall.   Continued...

A man walks past an old Toronto Stock Exchange (TSX) sign in Toronto, June 23, 2014.  REUTERS/Mark Blinch