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Canada’s main stock index was flat on Friday, as losses in bank stocks weighed on the financial sector.

The Toronto Stock Exchange’s S&P/TSX Composite index was down 4.30 points, or 0.03 per cent, at 16,563.12.

Eight of the index’s 11 major sectors were lower, with the financials sector down 0.2 per cent. National Bank was down 0.5 per cent and TD was off 0.4 per cent.

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The materials sector, which includes precious and base metals miners, dropped 0.2 per cent as gold prices slid due to easing trade tensions and weaker demand for precious metals on expectations of higher U.S. interest rates.

Italian deputy Prime Minister Luigi Di Maio said Italy will not ratify the European Union’s free trade agreement with Canada, ratcheting up an international trade spat and potentially scuppering the EU’s biggest accord in years.

NAFTA talks are now a big priority, given Mexico’s election is “now behind us”, U.S. Treasury Secretary Steven Mnuchin said on Thursday.

The energy sector climbed 0.9 per cent as U.S. crude rose 0.4 per cent and Brent crude added 0.3 per cent.

Biggest percentage gainers on the TSX were Eldorado Gold, which jumped 2.1 per cent following appointment of a new CFO, and Birchcliff Energy, up 2 per cent.

OceanaGold Corp. fell 2.6 per cent, top percentage loser on a rating cut by National Bank of Canada.

U.S. stock indexes were little changed on Friday as a slide in financials on the three big Wall Street banks reporting mixed results was offset by gains in industrials as the U.S.-China trade rhetoric eased overnight.

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Wells Fargo’s shares slid 3.7 percent and led losses on the benchmark S&P 500 after the bank reported a bigger-than-expected drop in quarterly profit as lending slowed and costs rose.

Citigroup fell 3 percent after its quarterly profit topped estimates, but revenue fell short due to lower debt underwriting.

JPMorgan reversed premarket gains after a profit beat to trade 0.8 percent lower. The S&P financial index fell 1.04 percent, the most among the 11 major S&P sectors.

The results from the banks kicked off earnings season in earnest, with profits of S&P 500 companies expected to have surged around 21 percent in the second quarter, according to Thomson Reuters I/B/E/S.

Data showed China’s trade surplus with the United States swelled to a record in June as its overall exports grew at a solid pace, a result that could further inflame the bitter trade dispute with Washington.

But Treasury Secretary Steven Mnuchin said on Thursday the countries could reopen trade talks if Beijing was willing to make significant changes.

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Industrial stocks, among the worst hit during the trade disputes, were up 0.49 percent.

The Dow Jones Industrial Average was up 17.15 points, or 0.07 per cent, at 24,942.04, the S&P 500 was down 1.35 points, or 0.05 per cent, at 2,796.94 and the Nasdaq Composite was up 3.48 points, or 0.04 per cent, at 7,827.40

Seven of the 11 major sectors were trading higher, with consumer staples leading gains with a 0.3 per cent rise.

The biggest percentage loser on the blue-chip Dow index was McDonald’s, down 1.6 per cent after the Iowa and Illinois health departments said they were investigating cyclospora infections linked to salads at its restaurants.

Johnson & Johnson fell 0.7 per cent after a jury ordered the Dow component to pay a record $4.69 billion to 22 women who alleged its talc-based products contain asbestos and caused them to develop ovarian cancer.

AT&T Inc’s shares fell 2 per cent after the U.S. Justice Department said it would appeal a federal judge’s approval of the telecom company’s $85.4 billion acquisition of Time Warner, which has already closed.

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With files from Reuters

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