TORONTO (Reuters) - Canada’s main stock index fell to a two-week low on Tuesday as lower commodity prices weighed on energy and materials stocks, while financials dropped after Canadian Western Bank (CWB.TO) set aside more money for loan losses.
Oil prices retreated further from the year’s highs hit last week as rising output renewed worries about the global glut of crude, while copper fell as manufacturing data from China undermined confidence and gold turned lower after nearing the prior session’s 15-month high.
“You got the double whammy of gold being down and oil being down,” said Philip Petursson, managing director of Capital Markets & Strategy at Manulife Asset Management.
The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE closed down 157.95 points, or 1.14 percent, at 13,707.68. It touched its lowest since April 18 at 13,599.93.
Weak earnings have challenged the market, said Petursson. However, he expects the index to climb above the 14,000 threshold this year as lower U.S. oil production helps sustain the recent uptrend in oil prices.
Shares of Encana Corp (ECA.TO)ECA.N fell 10.4 percent to C$8.33. The oil and gas producer posted a bigger-than-expected quarterly loss due to lower production amid a steep fall in oil prices.
U.S. crude CLc1 prices settled at $43.65 a barrel, down 2.52 percent.
The materials group, which includes precious and base metals miners and fertilizer companies, lost 2.0 percent. It included a 2.6 percent drop in the shares of Barrick Gold Corp (ABX.TO) to C$23.33, while spot gold XAU= dipped 0.4 percent.
Shares of Canadian Western Bank (CWB.TO) fell 6.9 percent to C$25.57 after the Edmonton, Alberta-based lender set aside more money to cover bad loans to oil companies.
WestJet Airlines Ltd (WJA.TO) reported a higher-than-expected quarterly profit, helped by lower fuel costs. Still, its shares fell 5.3 percent to C$20.35.
Eight of the index’s 10 main groups ended lower, with just health care and utilities having advanced.
Reporting by Fergal Smith; Editing by Bill Trott and Dan Grebler