TORONTO (Reuters) - A sharp jump in energy stocks as crude oil prices soared was not enough to push Canada’s main stock index into positive territory on Monday.
The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE ended down 5.95 points, or 0.04 percent, at 13,859.12.
Slightly more issuers gained than declined, with oil and gas stocks claiming 18 of the top 20 spots among most influential gainers, while eight of the 10 main sectors retreated.
Oil prices surged for a third consecutive day on a downward revision of U.S. crude production data and OPEC’s readiness to talk with other producers, pushing the sector up 3 percent.
“The fact that OPEC is going to get together and come up with a fair value for oil gave some boost to the market,” said Sid Mokhtari, director for institutional equity research at CIBC World Markets.
Mokhtari said Canada’s energy sector could gain another 7 to 9 percent in the next month as short sellers are forced to square their books, helping bring the index back up to around 14,200.
“If we can see stability in the energy complex, we’re naturally going to get stability in the banks as well,” he said.
Some of the country’s biggest banks were among its heaviest weights on Monday - Toronto-Dominion Bank (TD.TO) slipped 0.8 percent to C$52.48 and Royal Bank of Canada (RY.TO) lost 0.5 percent to C$73.34.
The index, which had been steadily declining since April, sank to its lowest level since 2013 last week on investor worries over China’s economic growth.
“It’s interesting that the banks have been under pressure, because they are really still pretty darn solid ... the banks are becoming pretty good value,” said Douglas Davis, chief executive officer at Davis-Rea.
The materials group, home to mining firms, fell 0.9 percent, with Barrick Gold Corp (ABX.TO) down 3.1 percent to C$9.15.
Additional reporting by Solarina Ho; editing by Paul Simao and Phil Berlowitz