TORONTO (Reuters) - Canada’s main stock index ended flat on Friday, rattled by lusterless bank earnings and weakness in oil and gas shares, a day after its biggest single-day drop in 18 months.
The resource-rich index has been pummeled in recent months by a slumping price for crude oil, which closed at its lowest since July 2009, with underwhelming numbers from some of Canada’s biggest lenders adding to the gloom. [O/R]
“This disappointment from the banks could honestly not have come at a worse time for the TSX” given the strain on energy stocks, said Elvis Picardo, a strategist at Global Securities in Vancouver.
Shares in Bank of Nova Scotia (BNS.TO) lost 2 percent to C$66.20 after Canada’s No. 3 lender reported weaker-than-expected profit on previously announced charges related to soured bets in the Caribbean and Latin America.
Other banks whose results have failed to impress also slipped, with Canadian Imperial Bank of Commerce (CM.TO) off 1.2 percent at C$102.33.
Despite the headwinds, the Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE inched higher, ending the day up 3.75 points, or 0.03 percent, at 14,473.70. The index ended last week at 14,744.75, a decline of 1.8 percent for the week.
“Part of the reason for today’s muted decline is the fact that we had such a big drop yesterday,” Picardo said.
Notable gainers included Potash Corp POT.TO, up 1.8 percent at C$40.42, and Manulife Financial Corp (MFC.TO), which gained 2.8 percent to C$23.01.
With the rout in oil prices showing no signs of abating, several energy producers also weighed, although Philip Petursson, portfolio advisory group at Manulife Asset Management, said some could prove very attractive once crude prices recover, which he expects will take a quarter or two.
“On the belief that oil prices are not likely to remain this low for an extended period of time, then there are definitely some bargains to be had with the oil producers,” Petursson said.
Reporting by Alastair Sharp; Editing by Peter Galloway and Meredith Mazzilli