* TSX down 0.31 percent at 13,708.19
* Financials main drag, down 1 pct
* Seven of 10 main sectors on the rise
* TD, CIBC, National report mixed results
* TMX shares up on Maple Group’s hostile bid (Adds details)
By Ka Yan Ng
TORONTO, May 26 (Reuters) - Toronto’s main stock index sagged on Thursday, weighed down by bank results that came in slightly below expectations.
Toronto-Dominion Bank (TD.TO), Canadian Imperial Bank of Commerce (CM.TO), and National Bank of Canada (NA.TO) all reported higher quarterly profit, but TD and CIBC were shy of market expectations, sending their shares down more than 2 percent. [ID:nN26230622] [ID:nN26207347]
“Two of three disappointed,” said Francis Campeau, a broker at MF Global Canada in Montreal. “The financial sector is bringing the Canadian market down.”
The weak results contrasted with the Bank of Montreal’s (BMO.TO) earnings on Wednesday, the first of the six biggest banks to report results. BMO’s earnings had been characterized as solid, raising hopes that its results would be mirrored at its peers.
At 10:35 a.m. (1435 GMT), the Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE was down 43.28 points, or 0.31 percent, at 13,708.19. Seven of the 10 main sectors were on the rise, but the 1 percent slide by financials overpowered the rest of the index.
Four banks were among the six most influential decliners: TD fell 2 percent to C$83.57, while CIBC lost 3.55 percent to C$81.45. Royal Bank of Canada (RY.TO), which reports second-quarter results on Friday, fell 0.94 percent to C$59.27, and Bank of Montreal shed 0.7 percent to C$61.60.
National Bank was off about 1 percent at C$80.11, even though its results came in slightly ahead of expectations and it raised its dividend, as expected. It also announced a long anticipated move to acquire all the common shares of wealth management firm Wellington West that it does not already own. [ID:nN26225673]
Bucking the trend in the financials sector, the Toronto Stock Exchange’s parent, TMX Group (X.TO), rose 1 percent to C$44 after a group of Canadian banks and pension funds said on Wednesday it would take its C$3.6 billion bid for TMX directly to shareholders. TMX had rejected Maple Group’s proposal in favor of a friendly takeover offer from London Stock Exchange. [ID:nN25173404]
Lundin Mining (LUN.TO) was among the most influential decliners, sliding more than 19 percent to C$6.90 after it said it had rejected several buyout bids and Chief Executive Phil Wright would resign in a month.
The diversified metals miner said on Wednesday it had received several expressions of interest in all or part of the company but decided they were all too low. [ID:nL3E7GQ00N]
Weak economic news from the United States also weighed on sentiment early on. The U.S. economy’s struggle to regain speed was underscored by data that showed growth slowed in the first quarter as consumers cut back spending and as more Americans filed for jobless benefits last week. [ID:nLDE74P1TT]
$1=$0.98 Canadian Reporting by Ka Yan Ng; editing by Rob Wilson