4 Min Read
* TSX composite ends up 1.78 points at 13,909.10
* Barrick biggest drag for second straight session
* Silver drops 5 pct, gold slides again (Adds details)
By Ka Yan Ng
TORONTO, April 26 (Reuters) - Toronto's main stock index finished almost unchanged on Tuesday as a drop in gold and silver prices hit shares of precious metal miners, offsetting the boost that a raft of strong U.S. earnings gave to sentiment.
Silver tumbled 5 percent after hitting a 31-year high in the previous session, while gold slid for a second straight day as investors sold it because of uncertainty about the direction of monetary policy in the United States as a two-day U.S. Federal Reserve policy meeting got under way. [GOL/] [ID:nN26273939]
The index's materials group, home to gold miners, fell 1.25 percent, weighing heavily on overall market performance.
"There's not too much weakness in most of the other sectors but the disproportionate weakness on the day in the materials group is capping the upside," said Elvis Picardo, analyst and strategist at Global Securities in Vancouver.
The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE finished 1.78 points higher at 13,909.10. Seven of its sectors were higher.
Barrick Gold Corp (ABX.TO) was the biggest drag of any stock on the index for a second straight session, falling 3.5 percent to C$47.75. Goldcorp (G.TO) fell 1.22 percent to C$51.90, while Silver Wheaton SLW.TO slid 4.8 percent to C$37.32.
As well as the falling gold price, a major factor in Barrick's decline was market dissatisfaction with its C$7.3 billion all-cash takeover bid for copper producer Equinox Minerals EQN.TO on Monday. On Tuesday, China's Minmetals Resources (1208.HK), which had also bid for Equinox, backed away. [ID:nL3E7FQ05D]
Barrick's offer values Equinox at 14 times its 2010 earnings before interest, tax, depreciation and amortization. Barrick's surprise move to buy a copper miner has unnerved some of its investors and puts the world's largest gold miner at risk of a downward reassessment in its value. [ID:nN2626230]
"The company clearly has a strategy that they want to execute and could benefit long-term investors, but I think short-term investors are not happy with Barrick branching away from gold," said Youssef Zohny, portfolio manager at Van Arbor Asset Management in Vancouver.
A flood of positive corporate results on Tuesday, including Ford and UPS, added to optimism about the economic growth outlook in the United States. Analysts said results will likely be the short-term driver in equity markets.
Canadian corporate results have started trickling in. After the market close on Tuesday, a pair of blue-chip Canadian companies reported better-than-expected results and built on momentum seen south of the border.
Canadian National Railway (CNR.TO), which finished up 1.2 percent at C$71, reported a 31 percent rise in quarterly profit on the back of an improving North American economy and a well-executed winter operating plan. It also raised its full-year financial forecast. [ID:nN26287831]
Rogers Communications (RCIb.TO), Canada's largest wireless company, reported a 6.5 percent jump in profit, helped by growth in its lucrative postpaid wireless business. Rogers closed 1.14 percent higher at C$34.74. [ID:nN25226138]
($1=$0.95 Canadian) (Reporting by Ka Yan Ng; editing by Peter Galloway)