(Adds portfolio manager quotes and details on energy stocks,
* TSX closes down 8.76 points, or 0.06 percent, at 15,410.73
* Energy falls 2.5 percent
* Just three of the TSX’s 10 main groups end lower
By Fergal Smith
TORONTO, May 25 Canada’s main stock index dipped
on Thursday as a plunge in oil prices weighed on energy shares,
offsetting gains for industrials and financials after quarterly
earnings from some major banks impressed investors.
U.S. crude prices settled $2.46 lower at $48.90 a
barrel after the Organization of the Petroleum Exporting
Countries’ decision to extend production curbs fell short of
expectations of deeper or longer cuts.
“Regardless of what OPEC does, U.S. shale producers can
produce at these prices or lower, so that is going to continue
to put an upward cap on the energy price,” said Mike Archibald,
associate portfolio manager at AGF Investments.
Canadian Natural Resources Ltd fell 2.0 percent to
C$40.21, while the overall energy group tumbled 2.5 percent. The
group has lost nearly 18 percent since posting a 19-month high
The sector is cheap but needs a more sustainable upswing in
the price of oil to attract investors, particularly U.S. money
managers, Archibald said.
The Toronto Stock Exchange’s S&P/TSX composite index
closed down 8.76 points, or 0.06 percent, at
15,410.73. Just three of the index’s 10 main groups ended lower.
Industrials rose 1.2 percent as railroad stocks climbed,
while the financials group, which accounts for a third of the
index’s weight, gained 0.3 percent.
The country’s biggest bank, Royal Bank of Canada,
rose 0.8 percent to C$93.74 after reporting an 11 percent profit
increase, beating market forecasts, on strong performances in
its capital markets and wealth management businesses.
Canada’s second-largest lender, Toronto-Dominion Bank
, was up 1.5 percent at C$64.01. Its earnings also
exceeded expectations, helped by a strong performance at its
retail and investment banking businesses.
But No. 5 bank Canadian Imperial Bank of Commerce
fell 1.0 percent to C$105.24 after reporting a softer beat than
its two larger peers.
“What you are seeing out of the broader bank reports in the
last couple of days is that loan loss provisions continue to be
in a solid position,” said Archibald.
Manulife Financial Corp, Canada’s biggest life
insurer, was up 0.6 percent at C$23.69 after it named Roy Gori,
an executive from its Asia division, to replace the retiring
Donald Guloien as chief executive officer.
Forestry products company Tembec Inc jumped 41.4
percent to C$4.17 after accepting a buyout offer from Rayonier
Advanced Materials Inc for C$4.05 a share.
(Additional reporting by Alastair Sharp; Editing by Lisa Von
Ahn and Tom Brown)