TORONTO (Reuters) - Canada’s main stock index fell on Tuesday as lower crude oil prices weighed on energy stocks, while financials reversed course after being lifted in earlier trade by better-than-expected Bank of Montreal earnings.
The index touched a seven-week high on Monday together with gains for many major stock markets. But the rally in global stocks ran out of steam as crude oil prices fell.
“We are still working through a base building process for world markets,” said Colin Cieszynski, senior market analyst at CMC Markets Canada.
It has led to “choppy trading” where markets can’t sustain momentum in either direction, he added.
The index retreated less than U.S. markets, cushioned by strengthening in the shares of gold miners as spot gold XAU= rallied nearly 1.3 percent.
It has fallen 1.9 percent year-to-date compared with a 6 percent drop for the S&P 500 .SPX.
The energy group fell 3.6 percent. It included a 3.4 percent drop in the shares of major oil sands operator Suncor Energy Inc (SU.TO) to $32.73, while Canadian Natural Resources Ltd (CNQ.TO) fell 4.5 percent to C$27.55.
U.S. crude CLc1 prices settled at $31.87 a barrel, down 4.55 percent after Saudi Oil Minister Ali Al-Naimi ruled out any production cuts. [O/R]
The overall financials group fell 0.9 percent, including a 5.7 percent slide in the shares of Fairfax Financial Holdings Ltd (FFH.TO) to C$721.72.
Bank of Montreal (BMO.TO) shares dipped 0.3 percent to C$73.68 even as it posted higher quarterly profits, boosted by growth in its U.S. retail banking business.
The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE closed down 82.19 points, or 0.64 percent, at 12,763.44. Five of the index’s 10 main groups ended lower.
The industrials group also dragged, falling 1.1 percent. It included a 3.5 percent drop in the shares of Canadian Pacific Railway Ltd (CP.TO) to C$168.33.
Among the most influential gainers was Valeant Pharmaceuticals International Inc (VRX.TO), which rose 5.0 percent to C$109.40 following a two-day selloff.
The company said it would restate results for 2014 and 2015 after identifying some sales to drug distributor Philidor Rx Services that should have been recognized only when the drugs were dispensed to patients.
The materials group, which includes precious and base metals miners and fertilizer companies, added 0.9 percent, as investors bought bullion-related assets. [GOL/]
Additional reporting by Alastair Sharp; Editing by W Simon and James Dalgleish