August 26, 2008 / 8:54 PM / 11 years ago

UPDATE 2-Toronto stocks edge up as oils offset banks

(Updates closing numbers, adds details)

* TSX ends little changed as financials offset oils

* Banks slide after weaker than expected results

* Energy shares give lift as oil prices rise

TORONTO, Aug 26 (Reuters) - The Toronto Stock Exchange’s main index ended little changed on Tuesday as energy shares rose along with oil prices and managed to offset a weak banking sector that was hit by lackluster quarterly results.

Kicking off the round of earnings reports for the major banks, Bank of Nova Scotia (BNS.TO) and Bank of Montreal (BMO.TO) both slid after they posted profits that came in below already lowered expectations.

Scotiabank, Canada’s third largest bank, fell 2.5 percent to C$46.45 after it said its profit skidded 2 percent, as provisions for credit losses climbed and revenue from capital markets fell.

BMO eased 0.3 percent to C$43.94 as its profit tumbled 21 percent, while it also had larger loan-loss provisions due to weak U.S. real estate markets. The stock sagged as much as 4 percent earlier in the session.

The underwhelming performances helped knock 1.1 percent off the TSX financial sector, and analysts said the earnings likely set the tone for what can be expected throughout the week as the rest of the major banks announce results.

The S&P/TSX composite index .GSPTSE closed up 10.11 points, or 0.08 percent, at 13,299.07 with half of its 10 main sectors in positive territory.

A 1.4 percent gain by the heavyweight energy sector helped keep the index above water as oil rose above $116 a barrel on growing worries that Hurricane Gustav could threaten U.S. oil and natural gas installations in the Gulf of Mexico.

Canadian Natural Resources (CNQ.TO) was up 1.7 percent at C$87.55, while Imperial Oil (IMO.TO) rose 2.2 percent to C$53.98.

Shares of Maple Leaf Foods (MFI.TO) skidded further, dropping 9.2 percent to C$7.99, after deli meats produced at a Toronto plant were linked to an outbreak of food poisoning that has left 12 people dead.

Maple Leaf said on Tuesday that it has delayed re-opening the plant in order to finish the disassembly of equipment and further tests. ($1=$1.05 Canadian) (Reporting by Leah Schnurr; editing by Rob Wilson)

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