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CANADA STOCKS-TSX dips as energy rally tempers broad, mining-led losses
September 13, 2017 / 8:37 PM / 9 days ago

CANADA STOCKS-TSX dips as energy rally tempers broad, mining-led losses

* TSX down 16.6 points, or 0.11 percent, to 15,126.81

* Eight of the TSX’s 10 main groups fall

* Eldorado jumps 15.8 percent on Greece permit grants

By Solarina Ho

TORONTO, Sept 13 (Reuters) - Canada’s main stock index struggled to advance on Wednesday and ended nominally lower as higher crude prices fueled sharp gains by oil and gas companies, while cooling metal prices drove hefty declines in mining firms.

Oil prices rallied more than 2 percent after the International Energy Agency (IEA) said the global crude surplus was beginning to shrink due in part to an output drop from key producers.

A stronger U.S. dollar weighed on metal prices, with gold falling to 1-1/2 week lows and copper sliding to three-week lows. Profit-taking, rising stocks in London Metal Exchange warehouses and nervousness about Chinese demand also contributed to lower copper prices.

“There’s two opposing forces, oils and metals. You have two of the largest sectors really pulling the TSX in opposite directions,” said Kevin Headland, senior investment strategist at Manulife Investments.

The Toronto Stock Exchange’s S&P/TSX composite index fell 16.6 points, or 0.11 percent, to end at 15,126.81, with eight of the index’s 10 main sectors ceding ground.

Headland expects the TSX to remain an underperformer among global indices this year and forecast underwhelming earnings growth in the third and forth quarters.

“The hurdle rate, or the barrier to success from last year’s Q3, Q4 earnings is that much harder ... this year,” said Headland.

Canadian Natural Resources rose 2.9 percent to C$40.22 while Encana Corp jumped 6 percent to C$12.42. The overall energy group rallied 2.5 percent.

The influential financials group gained 0.2 percent, though most individual advances were modest. Fairfax Financial Holdings Ltd jumped 4.4 percent to C$626.86.

The overall materials group, which includes precious and base metals miners and fertilizer companies, fell 1.8 percent. But losses were offset by Eldorado Gold’s 15.8 percent surge to C$2.79 after Greece said it would grant permits for its Olympias project this week.

Teck Resources Ltd sank 5.4 percent to C$26.73, while First Quantum Minerals Ltd fell 3.6 percent to C$13.30.

Industrials lost 0.9 percent, with Canadian Pacific Railway Ltd shedding 2.2 percent to C$191.67 after a price and ratings cut by National Bank of Canada. The Bank also trimmed its target price for Canadian National Railway, which retreated 1.6 percent to C$98.06.

Declining issues outnumbered advancing ones on the TSX by 152 to 95, for a 1.60-to-1 ratio on the downside.

Five companies on the index saw new 52-week highs, while one hit a new 52-week low. (Reporting by Solarina Ho; Editing by Chris Reese)

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