TORONTO - Canada's main stock index fell to a new one-week low on Tuesday as energy stocks slumped due to major oil exporters' struggle to agree on terms of a planned production cut, while Bank of Nova Scotia gained after a solid earnings report.
U.S. crude prices settled $1.85 lower at $45.23 a barrel, as Iran and Iraq resisted pressure from Saudi Arabia to curtail their output, complicating the efforts of the Organization of the Petroleum Exporting Countries to reach a global output-limiting deal when it meets on Wednesday.
The most influential weights on the index included Suncor Energy Inc, which fell 2.2 percent to $40.35, and Canadian Natural Resources Ltd, down 2.3 per cent to $41.67. The energy group retreated 2.4 per cent overall.
The pullback in energy stocks is a "buying opportunity," said Philip Petursson, chief investment strategist at Manulife Asset Management.
"We have seen a real shift in mindset out of OPEC ... that something needs to be done to support oil prices and if it (a deal) is not done at this meeting then it will be done the next time they get together."
Energy investors were also awaiting Canadian government decisions on two major Enbridge Inc pipeline projects that are expected on Tuesday. Shares in the company fell 1.3 per cent to $56.69.
The Toronto Stock Exchange's S&P/TSX composite index closed down 15.55 points, or 0.1 per cent, at 14,999.81, its lowest since Nov. 21.
Just three of the index's 10 main groups ended lower.
The financials group gained 0.6 per cent, helped by Bank of Nova Scotia gaining 1.6 per cent to $73.70 after Canada's third-biggest lender reported a better-than-expected rise in fourth-quarter earnings.
"The number one question on the banks continues to be how well they manage through a housing slow down if we see one. I think they are well prepared for it and that's showing up in the results," Petursson said.
The materials group, which includes precious and base metals miners and fertilizer companies, lost 0.7 per cent.
Copper producer First Quantum Minerals Ltd declined more than 7 per cent to $14.60 as industrial metal prices tumbled on fears that a post-U.S. election rally had become overstretched.
Copper prices declined 3.0 per cent to $5,704.85 a tonne and gold futures fell 0.3 per cent to $1,187.2 an ounce.
Canada's current account deficit narrowed in the third quarter after three consecutive quarterly increases as exports saw the highest growth in over two years.
U.S. stocks edged higher on Tuesday as an upbeat outlook from UnitedHealth lifted health insurers, but a sharp drop in oil prices weighed on energy shares and limited the advance.
The Dow Jones industrial average rose 23.9 points, or 0.13 per cent, to 19,121.8, the S&P 500 gained 2.95 points, or 0.13 per cent, to 2,204.67 and the Nasdaq Composite added 11.11 points, or 0.21 percent, to 5,379.92.