Toronto stocks to slip as commodities drop again

Wed May 28, 2008 8:56am EDT
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*Weak commodities signal lower open for TSX

*More bank results on radar

*Sears Canada reports big rise in profit

TORONTO, May 28 (Reuters) - The Toronto Stock Exchange's main index was set to slide again on Wednesday, following the storyline from the previous session, as soft commodities signaled a weak start for energy and materials shares.

With Canadian banks churning out their quarterly results, reports expected from Toronto-Dominion Bank (TD.TO: Quote) and the smaller Laurentian Bank (LB.TO: Quote) could give the market direction later in the session.

On Tuesday, Bank of Montreal (BMO.TO: Quote) and Bank of Nova Scotia (BNS.TO: Quote) reported lower profits and higher provisions for credit losses. For details, see: [nN27379917]

The revelations knocked the bank stocks lower and helped to drain 1.6 percent from the overall TSX in the previous session, although falling commodity prices were responsible for the bulk of the damage.

Continuing that tumble on Wednesday were energy, base metals and precious metals.

Weakness in commodity markets usually leads to weakness in Canadian resource stocks.   Continued...