Lower energy sector causes TSX to fall as crude hits a three-month low

Ross Marowits, The Canadian Press
Published Wednesday, May 29, 2019 11:36PM EDT
Last Updated Thursday, May 30, 2019 4:57PM EDT

TORONTO — Canada’s main stock index lost more ground Thursday on a big dip in the energy sector prompted by oil falling to its lowest level in three months.

The S&P/TSX composite index closed down 42.23 points to 16,089.24 following a third-straight day of losses.

The key energy sector fell about 1.5 per cent as Enbridge Inc. and Canadian Natural Resources lost 1.04 and 0.76 per cent respectively.

The July crude contract was down 3.8 per cent or US$2.22 at US$56.59 per barrel and the July natural gas contract was down 7.7 cents at US$2.55 per mmBTU.

Crude prices fell after a weekly U.S. report said stockpiles fell less than expected while geopolitical tensions eased.

“So on a day when you have geopolitical tensions in the Middle East and even Russia be quiet then you see oil prices retreat,” said Kash Pashootan, CEO and chief investment officer at First Avenue Investment Counsel Inc.

“We don’t view the recent movement in oil prices higher, and now lower, to be rooted in supply and demand fundamentals. We feel they’re rooted in geopolitical and supply disruption reasons.”

The consumer discretionary sector benefited from BRP Inc. shares rising nearly 16 per cent after beating estimates in its latest quarter and Canada Goose recovering somewhat from Wednesday’s 31-per-cent loss by closing up 4.1 per cent.

The Canadian dollar traded at an average of 74.07 cents US compared with an average of 74.00 cents US on Wednesday.

The August gold contract was up US$6.10 at US$1,292.40 an ounce and the July copper contract was down one cent at US$2.65 a pound.

In New York, the Dow Jones industrial average was up 43.47 points at 25,169.88. The S&P 500

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