TORONTO (Reuters) - Canada’s benchmark stock index fell on Tuesday, mirroring U.S. market sentiment, with energy stocks leading declines as the price of crude oil fell.
Investor worries about the French presidential election this coming weekend, possible U.S. military action against North Korea and a snap British election set for June weighed on global markets. Some disappointing quarterly results and uncertainty over fiscal promises by U.S. President Donald Trump added to pressure on Wall Street.
The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE closed down 62.32 points, or 0.4 percent, to finish at 15,622.57. Seven of the index's 10 main groups lost ground.
“That seems to be driven by the delay in any kind of tax reform ...The reflation trades in the U.S. are spilling over into Canada,” said Noman Ali, senior portfolio manager at Manulife Asset Management.
The Trump administration’s failure to pass a healthcare reform bill has raised concerns that it may struggle to pass highly anticipated tax cuts and infrastructure spending bills.
“There’s a big cyclical component within the Canadian index. If inflation expectations are coming down, that’s not good for cyclicals generally,” said Ali.
Energy stocks, which make up nearly 22 percent of the index’s weight, retreated 0.9 percent.
The most influential movers on the index included Canadian Natural Resources CNQ.TO, which fell 1.6 percent to C$44.21, and Enbridge Inc ENB.TO, which declined 0.6 percent to C$56.42. U.S. crude CLc1 prices settled down 0.46 percent at $52.41 a barrel, while Brent crude LCOc1 settled down 0.85 percent at $54.89.[O/R]
“Energy has been a drag in Canada, mainly on concerns around increased U.S. production out of the U.S. shale names and some uncertainty around the OPEC decision in May,” said Ali.
Financials, which account for just over a third of the index's weight, slipped 0.5 percent. Royal Bank of Canada RY.TO dipped 0.5 percent to C$95.43, while Bank of Nova Scotia BNS.TO was off 0.7 percent to C$76.61.
Rogers Communications Inc RCIb.TO reported a 27.8 percent increase in quarterly profit, as it signed up more postpaid wireless and internet customers. Rogers' shares rose 0.7 percent to C$61.42 ahead of results, which came after markets closed.
Declining issues outnumbered advancing ones on the TSX by 140 to 106, for a 1.32-to-1 ratio on the downside.
The index posted 12 new 52-week highs and two new lows.
Reporting by Solarina Ho; Editing by Leslie Adler
Our Standards: The Thomson Reuters Trust Principles.