TSX hits one-month low as financials retreat

TORONTO (Reuters) - Canada’s main stock index fell to a one-month low on Tuesday as heavyweight financial shares declined, but some losses for the index were pared, while gold mining stocks climbed as gold prices benefited from pressure on the U.S. dollar.

A man walks past an old Toronto Stock Exchange (TSX) sign in Toronto, June 23, 2014. REUTERS/Mark Blinch

The Toronto Stock Exchange’s S&P/TSX composite index closed down 19.16 points, or 0.12 percent, at 15,385.96, its lowest close since Dec. 30.

The index fell for the fourth straight day for the first time since Donald Trump’s victory in the U.S. presidential election in November.

“The equity market rally was getting a little bit long in the tooth and investors are taking a breather until they get a little bit more clarity on the political backdrop, particularly in the U.S.,” said Candice Bangsund, portfolio manager at Fiera Capital.

Still, the index closed well above its intraday low of 15,313.02 and rose 0.6 percent for the month.

“The fundamental backdrop is still supportive,” including earnings that have been coming in stronger than expected and economic growth which was already picking up before the U.S. election, Bangsund said.

The Canadian economy grew 0.4 percent in November from October, faster than economists had expected.

Financials fell 0.5 percent, with Toronto-Dominion Bank down 0.7 percent at C$67.41.

Losses for financials came as bond yields eased on safe-haven demand and ahead of a decision on U.S. interest rates on Wednesday from the Federal Reserve.

Imperial Oil Ltd reported a sharp rise in fourth-quarter profit, helped by a gain from the sale of its service stations.

Still, its shares dipped 0.1 percent and the overall energy group gained just 0.1 percent even as oil prices rose.

On Monday, the energy group hit its lowest in more than two months. It got a boost last week from revived prospects for the Keystone XL pipeline, but investors have been worried about a potential U.S. border adjustment tax.

U.S. crude prices settled 18 cents higher at $52.81 a barrel after news OPEC oil production has fallen sharply this month. [O/R]

Six of the index’s 10 main groups were lower, with industrials falling 0.9 percent as railroad stocks declined.

The materials group, which includes precious and base metals miners and fertilizer companies, added 1.3 percent as a weaker U.S. dollar helped push copper to a two-month high and gold to a one-week high.

Copper prices advanced 2.9 percent to $5,990.85 a tonne and gold futures rose 1.4 percent to $1,209.3 an ounce.

Reporting by Fergal Smith; Editing by David Gregorio and James Dalgleish