TSX falls on lower oil prices, credit market uncertainty

TORONTO (Reuters) - Canada’s main stock index fell on Wednesday, hitting a two-week low as a drop in oil prices and credit market uncertainty weighed on energy and financial stocks.

A man walks past an old Toronto Stock Exchange (TSX) sign in Toronto, June 23, 2014. REUTERS/Mark Blinch

The market closed lower for a fourth straight day despite reassurance from Federal Reserve Chair Janet Yellen about the U.S. economy’s ability to absorb a gradual rise in interest rates.

The weak oil price “continues to put pressure on the index,” said Youssef Zohny, a portfolio manager at StennerZohny Investment Partners.

U.S. crude prices CLc1 fell 2 percent after stockpiles at the main U.S. delivery point hit record highs.

Canadian Natural Resources Ltd CNQ.TO fell 2.7 percent to C$27.36, while Cenovus Energy Inc CVE.TO was down 8.4 percent at C$13.52. The overall energy group fell 2.7 percent.

Financial stocks fell 1.4 percent after reversing earlier gains. It included a 2.1 percent drop in the shares of Royal Bank of Canada RY.TO to C$66.19.

Bank stocks are likely to remain under pressure ahead of earnings as investors worry about uncertainties surrounding energy and credit markets, according to Zohny.

Algonquin Power & Utilities Corp AQN.TO fell 7.8 percent to C$10.64 after announcing on Tuesday a C$3.4 billion acquisition.

The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE closed down 96.93 points, or 0.79 percent, at 12,185.72, its lowest close since Jan. 25.

Five of the index’s 10 main groups were lower.

Information technology was among sectors that advanced, rising 1.6 percent. It was led by a 10 percent jump in shares of Open Text Corp OTC.TO to C$65.51.

The materials group, which includes precious and base metal miners and fertilizer companies, rose 0.2 percent.

Goldcorp Inc G.TO rose 3.5 percent to C$20.31, while Barrick Gold was also up 3.5 percent at C$16.11.

Reporting by Fergal Smith; Editing by Meredith Mazzilli and Tom Brown