TSX falls as gold miners, banks weigh

TORONTO (Reuters) - Canada’s main stock index fell on Monday, as major gold miners lost ground and heavyweight banks also pulled back as the federal government tightened mortgage and tax rules in a bid to cool the housing market.

A sign board displaying Toronto Stock Exchange (TSX) stock information is seen in Toronto June 23, 2014. REUTERS/Mark Blinch

The most influential stocks weighing on the index included Goldcorp Inc which fell 4.5 percent to C$20.68 after it temporarily shut down its Peñasquito gold mine in Mexico due to a week-long blockade by a trucking contractor.

Barrick Gold Corp, which is dealing with its own forced shutdown of operations at a mine in Argentina, lost 1.9 percent to C$22.78.

The materials group, which includes precious and base metals miners and fertilizer companies, lost 1.8 percent.

“Apart from the trials and tribulations of the giant gold companies which are mostly Canadian, the mining companies are experiencing a growing arrival of free cash flows,” said Michael Smedley, chief portfolio manager at Morgan Meighen & Associates.

The Toronto Stock Exchange’s S&P/TSX composite index closed down 36.82 points, or 0.25 percent, at 14,689.04.

Seven of the index’s 10 main groups ended in negative territory.

The financials group slipped 0.2 percent, as Ottawa said it will close a tax loophole and introduce a stress test to insured mortgage lending.

Investors were also more cautious as Britain set a March deadline to start its withdrawal from the European Union and worries over Deutsche Bank continued to swirl.

Royal Bank of Canada fell 0.4 percent to C$80.95 and Canadian Imperial Bank of Commerce lost 0.7 percent to C$101.01.

Shares in fashion retailer Aritzia Inc settled at C$17.71 in their market debut, after they were priced at C$16 last week.

The energy sector gained 0.6 percent as Brent settled above $50 a barrel for the first time since August and U.S. crude hit three-month highs, after Iran exhorted the need for other oil producers to join OPEC in supporting the market. [O/R]

Shares in Spectral Medical Inc slumped 85 percent to 24 Canadian cents after it said its experimental treatment for sepsis - a common, often deadly complication of infection - failed a late-stage study, stymieing the company’s plans to bring to market the first U.S. Food and Drug Administration-approved device for the condition.

Reporting by Alastair Sharp; Editing by Jonathan Oatis and Lisa Shumaker