Roundup: Canadian stocks dip down after crude recedes

Canada's main stock market in Toronto dipped into negative territory Tuesday after crude oil prices fell back over Saudi plans on no production cuts.

The Toronto Stock Exchange's benchmark Standard & Poor's/TSX Composite Index lost 82.19 points, or 0.64 percent, to close at 12,763.44 points. Five of the TSX index's eight main sub-sectors were lower.

Oil prices backpedaled Tuesday after Saudi Arabia ruled out production cuts. Major oil exporters including Saudi Arabia and Russia have proposed to freeze output at January levels only if other producers join them.

The West Texas Intermediate for April delivery moved down 1.52 U.S. dollars to settle at 31.87 dollars a barrel on the New York Mercantile Exchange, while Brent crude for April delivery declined 1.42 U.S. dollars to close at 33.27 dollars a barrel on the London ICE Futures Exchange.

Consequently, TSX energy group saw a 3.63 percent retreat. Canadian Natural Resources Limited went down 4.47 percent, while Calgary-based energy producer Encana Corporation declined 8.59 percent and Suncor Energy Inc, Canada's largest oil and gas company, lost 3.42 percent.

The Canadian federal government has confirmed plans to provide 251.4 million Canadian dollars (182.6 million U.S. dollars) to Alberta under a program designed to help provinces hit by sudden revenue downturns.

The western Canadian province of Alberta has been sideswiped by collapsing oil prices and the little-known fiscal stabilization program provides help when provincial revenues fall by more than five percent from one year to the next.

The northeastern Canadian province of Newfoundland and Labrador, which has also been hit by sagging oil prices, may also qualify for the program and the federal government says it will quickly assess such a claim if the province applies for money.

On Tuesday, Bank of Montreal (BMO) and National Bank of Canada kicked off the fiscal first-quarter reporting season for the big banks, with a mix of good and not-so-good news that will likely set the tone for the rest of the reporting season, if not the entire year.

BMO's profit rose 7 percent over last year, to nearly 1.1 billion Canadian dollars, no doubt providing some relief to anyone who felt that the depressed energy sector, low interest rates and weak Canadian economy were going to exert some influence during the quarter.

With National Bank's 165 million Canadian dollars writedown on its investment in Maple Financial Group during the quarter, its adjusted profit rose 4 percent, to 427 million, ahead of analysts' estimates.

However, in the resource-linked Toronto market, the banks were headed reverse despite better-than-expected earnings, down 0.93 percent as a sector.

Bank of Montreal closed down 0.26 percent to 73.68 Canadian dollars per share, National Bank of Canada was down 2.30 percent to 37.44 Canadian dollars per share, and Royal Bank of Canada was down 1.22 percent to 69.63 Canadian dollars a share.

With bank share prices slipping into a bear market earlier this year, down more than 20 percent from their highs, analysts, already cautious heading into the reporting season, didn't change their outlook on Tuesday following the quarterly results from BMO and National Bank.

Meny Grauman, an analyst at Cormark Securites, noted that the future still looks murky: "The problem is that with oil prices still in the doldrums and a fresh round of borrowing base reviews looming, the outlook remains very challenging. This should limit positive market reaction to results that on the face of it beat expectations."

Metals and mining stocks took the biggest bruising, most notably Teck Resources, down 1.04, or 11.15 percent, to 8.29 Canadian dollars per share.

Among gold stocks, the leader among winning groups, Barrick Gold leaped 6.15 percent to 18.63 Canadian dollars per share, while Goldcorp popped 2.66 percent to 21.26 Canadian dollars a share.

Health-care stocks climbed out of sick bay, as much-maligned Valeant Pharmaceuticals jumped 5.03 percent to 109.40 Canadian dollars per share following a two-day selloff.

Valeant said it would restate results for 2014 and 2015 after identifying some sales to drug distributor Philidor Rx Services that should have been recognized only when the drugs were dispensed to patients.

In the telecom sector, TELUS Corporation gained 18 cents, or 0.45 percent, to 39.76 Canadian dollars per share, while Rogers Communications took on 23 cents, or 0.46 percent, to 50.01 Canadian dollars per share.

The Canadian dollar was traded lower at 0.7263 U.S. dollar, compared with Monday's closing rate of 0.7293 U.S. dollar. Enditem