August 24, 2017 / 11:53 AM / in 2 months

TSX edges higher as Fairfax jump offsets CIBC, grocery stocks

TORONTO (Reuters) - Canada’s benchmark stock index inched higher on Thursday, boosted by a sharp jump in Fairfax Financial Holdings Ltd (FFH.TO) after it sold a Singapore insurer, while Canadian Imperial Bank of Commerce (CM.TO) fell after it reported a rise in quarterly net income.

The Toronto Stock Exchange sign is seen in Toronto, Ontario, Canada July 6, 2017. REUTERS/Chris Helgren

A decline in oil prices weighed on the country’s energy sector, while grocery stocks fell in the wake of Amazon.com Inc (AMZN.O) saying it would cut prices on a range of popular goods sold at Whole Foods Market Inc after receiving U.S. antitrust approval for its takeover a day earlier.

Loblaw Cos Ltd (L.TO) fell 1.3 percent to C$67.02 and Metro Inc (MRU.TO) lost 1.2 percent to C$41.57.

“It’s a threat to the business model,” said John Stephenson, CEO of Stephenson & Company Capital Management.

Fairfax surged 5 percent to C$636.62 after saying it would sell First Capital Insurance for $1.6 billion and team up with the acquirer, Japan’s Mitsui Sumitomo Insurance Company, to explore other opportunities.

“It’s a lot of ground to cover, it makes sense to bring in a local partner,” Stephenson said. “It’s definitely a divide and conquer strategy as opposed to going it alone and trying to do it organically.”

The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE ended up 13 points, or 0.09 percent, at 15,076.16.

CIBC, Canada’s fifth-biggest lender, fell 1.9 percent to C$105.57 despite recording a rise in earnings as a strong performance from its retail business offset a weaker showing at its capital markets division. While CIBC’s results topped market expectations, Barclays analyst John Aiken said the beat will “likely be viewed as low quality from investors” having been driven by increased revenues from its corporate business.

U.S. crude prices fell 2 percent on Thursday as Hurricane Harvey, forecast to come ashore as the strongest storm to hit the United States’ mainland in 12 years, threatened oil operations along the energy hub on the Gulf Coast. [O/R]

The Canadian energy group slipped 0.3 percent.

Additional reporting by John Tilak, editing by G Crosse

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