TORONTO (Reuters) - Canada’s main stock index dropped on Tuesday after weakness in the prices for gold, oil and other commodities weighed on shares of natural resource producers.
The decline came after advances in the last five sessions. The Toronto market is up 7.6 percent this year and almost touched a multi-year high on Monday.
Bank of Nova Scotia shares rose after it released strong quarterly results but the increase was not enough to halt the index’s retreat.
Scotiabank’s second-quarter profit rose 14 percent, beating analysts’ estimates, as higher income at its domestic banking and global wealth units offset a flat performance in international retail banking.
Shares of gold-mining companies gave back almost 4 percent and energy stocks shed 0.8 percent. The two groups are among the strongest performers on the Toronto Stock Exchange this year.
“It’s just a matter of position adjustment or profit taking going on in those two sectors,” said Elvis Picardo, strategist at Global Securities in Vancouver, who is positive on the prospects for the Canadian benchmark index this year.
“As long as earnings growth remains in place and the global economy continues to chug along, it does seem like the fundamentals are in place for the TSX to attempt new highs,” he added.
The Toronto Stock Exchange’s S&P/TSX composite index closed down 57.67 points, or 0.39 percent, at 14,658.02. Five of the 10 main sectors on the index were in the red.
Among gold producers, Barrick Gold Corp tumbled 4 percent to C$17.30, and Goldcorp Inc slipped 4 percent to C$25.57.
Shares of energy producers reflected weakness in oil prices. Canadian Natural Resources Ltd lost 1.3 percent to C$43.94, and Suncor Energy Inc declined 1 percent to C$41.88.
Financials, the index’s most heavily weighted sector, added 0.4 percent, with Scotiabank rising 1.1 percent to C$68.77.
In corporate news, Allergan Inc said Valeant Pharmaceuticals International’s $47 billion offer overstated the possible savings from the deal in terms of both research and development and in tax structure. Valeant shares gave back 1.9 percent to C$141.04.
Editing by Peter Galloway and James Dalgleish