TSX edges lower as U.S. earnings dent sentiment

TORONTO (Reuters) - Canada’s main stock index edged lower on Tuesday as a disappointing start to U.S. earnings season weighed, offsetting gains for the shares of energy companies after a move higher in oil prices.

A sign board displaying Toronto Stock Exchange (TSX) stock information is seen in Toronto June 23, 2014. REUTERS/Mark Blinch

Modest losses for the TSX follow a market holiday on Monday when the price of Brent oil reached its highest in a year.

“Investors in Canada are digesting more than just their Thanksgiving weekend meals today, they are also taking in the start of U.S. third quarter earnings season,” said Stan Wong, director of wealth management at ScotiaMcLeod.

Wall Street also ended lower as disappointing corporate reports gave a sour tone to the start of earnings season and investors digested possible changing dynamics in the run up to the Nov. 8 U.S. elections.

“North American equity market valuations are still feeling full ... for a meaningful move higher in equity markets we need accelerated global growth and a stronger earnings recovery,” Wong said.

The Toronto Stock Exchange’s S&P/TSX composite index closed down 16.66 points, or 0.11 percent, at 14,549.60.

Eight of the index’s 10 main groups ended lower.

The materials group, which includes precious and base metals miners and fertilizer companies, lost 0.6 percent.

Barrick Gold Corp fell 1.7 percent to C$20.55, as the prospect of a December U.S. Federal Reserve interest rate hike weighed on gold prices.

Spot gold fell 0.5 percent.

Shares in online gambling company Amaya Inc fell 3.4 percent to C$22.61 after surging late last week on confirmation the company is in talks to merge with William Hill plc.

The overall consumer discretionary group declined 0.7 percent, while the heavyweight financials group dipped 0.1 percent.

Brookfield Asset Management Inc fell 1.2 percent to $46.70. Canada’s largest alternative-asset manager, is considering a bid for troubled hockey gear-maker Performance Sports Group Ltd, Bloomberg reported.

The energy group climbed 1.2 percent, including a 1.4 percent rise in the shares of Suncor Energy to C$37.40, while Cenovus Energy Inc advanced 3.1 percent to C$20.40.

U.S. crude prices settled down 56 cents at $50.79 a barrel amid doubts about the ability of major oil producers to reduce a global supply glut.

Teck Resources Ltd advanced 4.4 percent to C$24.27. The company owns a 22.5 percent stake in one of Peru’s top copper and zinc mines, which is planning to double its zinc output next year.

Canadian housing starts surged in September compared with August, surpassing market expectations, data from the national housing agency showed.

Additional reporting by Alastair Sharp; Editing by Meredith Mazzilli and Grant McCool