TSX hit by weaker commodities, Alcoa results
TORONTO (Reuters) - Toronto's main stock index closed lower for a second straight day on Tuesday as materials and energy shares were hit hard by slipping commodity prices and a soft earnings report from U.S. aluminum giant Alcoa.
The Alcoa report raised fears of a sluggish economic recovery and commodity prices weakened. Canadian economic figures on Tuesday, however, reinforced the view that growth is accelerating in this country. Trade data for February was stronger than expected and new-home prices rose in the same month.
Nine of the index's 10 main groups were lower, led by a 1.16 percent fall in the materials sector as gold and base metals prices eased. Barrick Gold Corp, the world's biggest producer, fell 1.2 percent to C$40.41, while Teck Resources slipped 1.1 percent to C$44.94.
"The materials sector in particular is fairly negative due to Alcoa's earnings yesterday," said Youssef Zohny, associate portfolio manager at Van Arbor Asset Management in Vancouver.
"Alcoa is a great signal and a great gauge on the economic recovery."
The Toronto Stock Exchange's S&P/TSX composite index finished down 47.14 points, or 0.39 percent, at 12,101.52, clawing back from a more than 1 percent loss earlier in the day.
While Alcoa kicked off earnings season with its fifth net loss in the past six quarters, some investors looked forward to other sectors such as banks and technology companies that might perform better. That could mean sideways trading in the short term as the market awaits their results.
"People are pretty much getting ready with earnings starting...and not really making any huge moves," said Steve Ibel, institutional equities trader at Beacon Securities in Halifax, Nova Scotia.
The index's energy sector lost 0.42 percent, off session lows as oil prices pared losses but settled lower for a fifth straight session. Continued...