June 6, 2013 / 1:48 PM / 6 years ago

TSX posts fifth straight decline, turns negative on year

TORONTO (Reuters) - Canada’s main stock index fell for a fifth straight session on Thursday, dragged by weaker financials to a one-month low as investors nervously awaited an upcoming U.S. jobs report.

A Toronto Stock Exchange (TSX) logo is seen in Toronto November 9, 2007. REUTERS/Mark Blinch

With the day’s drop, the index has slipped into the red for the year.

A slew of negative economic numbers this week renewed doubts about the global economic recovery and weighed on the Toronto market.

Investors also speculated whether the U.S. Federal Reserve will roll back its stimulus program.

“You’ve had a series of bad economic data that’s been coming out,” said Sid Mokhtari, market technician and director, institutional equity research, at CIBC World Markets.

“Maybe people are a little jittery,” he added. “Everyone’s a little nervous about tomorrow’s nonfarm payroll.”

The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE closed down 34.32 points, or 0.28 percent, at 12,409.33. It earlier slipped to its lowest since May 2.

The European Central Bank kept interest rates unchanged and President Mario Draghi said the bank’s policy would remain accommodative for as long as needed, signaling a readiness to keep rates low for months to come, to aid an economic recovery.

U.S. job growth probably picked up only slightly in May, an Friday’s report is expected to show, suggesting the economy is still in a rut and not ready for the Federal Reserve to dial back its monetary support.

“We’re getting fixated on the jobs number because we may or may not be at an inflection point with interest rates backed up,” said Paul Hand, managing director at RBC Capital Markets. “So there’s a heightened sense of sensitivity around this week’s number.”

Seven of the 10 main sectors on the Toronto index were down.

The resource-heavy Canadian market has underperformed its U.S. peers this year because sluggish commodity prices have weighed on sentiment.

“We’re trapped between the resource stocks and the other sectors,” Hand said. “To get things going, the resource sector has to gain, and it will depend more on the global economy, not just the North American economy, being robust.”

Financials, the index’s most heavily weighted sector, gave back 0.8 percent.

Royal Bank of Canada (RY.TO), the country’s biggest lender, lost 1.2 percent to C$59.82 and played the biggest role of any single stock in leading the market lower.

Shares of energy producers gained 0.1 percent after a rise in the price of oil.

Oil sands producer MEG Energy Corp. (MEG.TO) rose 3.9 percent to C$30.66.

The materials sector, which includes mining stocks, was down slightly despite a gain in the gold sector.

In company news, Bombardier Inc.’s (BBDb.TO) train unit said it received an order worth about $771 million for a new generation metro fleet from the Stockholm Public Transport Authority. The stock climbed 1.2 percent to C$4.92 and was one of the most influential gainers on the market.

Editing by Dan Grebler

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