Canada’s main stock index edged lower Friday, as losses in bank stocks weighed on the financial sector, and utilities and tech companies dipped..
The Toronto Stock Exchange’s S&P/TSX Composite index closed down 6.30 points, or 0.04 per cent, at 16,561.12.
Seven of the index’s 11 major sectors were lower, with the financials sector down 0.1 per cent. National Bank was down 0.6 per cent, TD was off 0.5 per cent and Element Fleet declined 1.5 per cent.
The utilities group was down 0.2 per cent with Boralex down 2.7 per cent, Algonquin Power off 0.7 per cent and Hydro One down 1.8 per cent after the departure earlier this week of its board and CEO.
The tech sector slid 0.4 per cent. Shopify was off 0.7 per cent and Constellation Software fell 1.3 per cent. Celestica was off 0.9 per cent.
The materials sector, which includes precious and base metals miners, dropped 0.4 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. Kinross Gold fell 1.4 per cent.
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 1 per cent. Encana gained 2.7 per cent, Baytex Energy added 1.3 per cent and Suncor was up 1.3 per cent.
Big percentage gainers on the TSX were Eldorado Gold, which jumped 0.7 per cent following appointment of a new CFO, and Birchcliff Energy, up 2.8 per cent.
OceanaGold Corp. fell 2.9 per cent on a rating cut by National Bank of Canada.
Callidus Capital Corp. plunged as much as 43 per cent to a record low Friday after the embattled lender eliminated its dividend, citing new funding requirements. It closed down 29 per cent.
U.S. stocks edged higher on Friday, with the S&P 500 hitting a more than five-month high, as gains in industrials and other areas offset a drop in financials after results from three big Wall Street banks mostly disappointed investors.
The Dow Jones Industrial Average rose 94.52 points, or 0.38 per cent, to 25,019.41, the S&P 500 gained 3.02 points, or 0.11 per cent, to 2,801.31 and the Nasdaq Composite added 2.06 points, or 0.03 per cent, to 7,825.98.
The industrial sector gained 0.6 per cent, with Boeing, Caterpillar and 3M all up more than 1 per cent, in the absence of any trade rhetoric overnight.
Treasury Secretary Steven Mnuchin said the United States and China could reopen trade talks if Beijing was willing to make significant changes.
Oil prices rose over 1 per cent as strike actions in Norway and Iraq hit supplies, boosting the energy sector 0.89 per cent, the most among the 11 S&P sectors.
These gains helped the S&P hit 2,804.53, its highest since Feb. 2. The index is now about 2.5 per cent from its all-time high of 2,872.87, hit on Jan. 26.
As the trade row continues, investors are looking ahead to what is expected to be a strong second-quarter earning season, though reports on Friday from three of the biggest U.S. banks failed to enthuse. “There’s pretty impressive resilience in spite of the disappointment from the financials, which have been and continue to be a laggard. Even in the face of that, there’s still relative strength,” said Michael James, managing director of equity trading at Wedbush Securities in Los Angeles.
Earnings “expectations are certainly elevated from where they were a month ago, but if companies do deliver in general, even with elevated expectations, I believe the market as a whole will continue to move higher, and it will not result in a sell-the-news reaction,” he said.
Citigroup slid 2.2 per cent, the most among financials, after its revenue fell short of estimates due to lower debt underwriting. Wells Fargo dipped 1.2 per cent after its profit fell more than expected as lending slowed and costs rose.
JPMorgan shares were down 0.5 per cent though the bank’s profit beat estimates. The financial index fell 0.5 per cent.
Netflix sank 4.3 per cent after Deutsche Bank warned the company could fall short of subscriber growth numbers when it reports results on Monday.
Johnson & Johnson dropped 1.4 per cent after a jury ordered it to pay a record US$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 1.7 per cent on the U.S. Justice Department’s plan to appeal a federal judge’s approval of the company’s already closed US$85.4-billion acquisition of Time Warner.
with files from Reuters