Source: The Canadian Press

The Toronto stock market ended the session lower Tuesday after being battered by weak commodities prices, while investors also digested signals that the U.S. Federal Reserve is prepared to take new steps to shore up the American economy if necessary.

The S&P/TSX composite index slipped 63.94 points to 12,170.57, while the TSX Venture Exchange lost 5.62 points to 1,680.77.

Gold stocks lifted half a per cent as the December bullion contract ended the session lower for the first time in four trading days, down $6.50 from Monday’s record close to finish at US$1,274.30 an ounce in New York.

Oil prices also ticked lower, sending the energy index down 1.1%. The contract for benchmark crude for October delivery on the New York Mercantile Exchange, which expired at the end of the session, was down $1.34 at US$73.52 a barrel. The more active November contract closed $1.22 lower at US$74.97 a barrel.

Suncor Energy (TSX:SU) lost 52 cents to C$32.83.

The Toronto market is heavily weighted in both oil and gold, which means that price shifts can have a noticeable impact on the overall direction of the index.

“It’s probably nothing more than a pause at this point,” said Larry Berman, chief investment officer at ETF Capital Management.

“I do think we’re going to get maybe one more pullback over the next few weeks but markets look to be OK heading into the end of the year.”

In the United States, the Fed said it is prepared to provide additional support for the economy if needed.

The Dow Jones industrial average lifted 7.41 points to 10,761.03, while Nasdaq composite index backed off 6.48 points to 2,349.35. The S&P 500 lost 2.94 points to 1,139.78.

The U.S. central bank said that inflation remains below levels that indicate a healthy economy and that it was ready to act to provide “additional accommodation” to support the recovery. That could mean more purchases of Treasury bonds or other debt, which would keep interest rates low and hopefully encourage borrowing.

“They definitely opened the door in several very clear and intentional ways to keep the possibility for quantitative easing definitely on the table,” said Kathryn Delgreco, investment adviser at TD Waterhouse.

“When it comes down to it, it’s all about the communication and their wording and how it’s so widely scrutinized. So that’s no small change, really, in communicating its willingness to act.”

The TSX information technology sector was the leading advancer, ahead 0.9% with Research In Motion (TSX:RIM) gaining traction after photos emerged online of a rumoured new Storm 3 smartphone. RIM stock lifted $1.91 to $48.29.

The metals and mining sector gained 0.7% as the December copper contract on the Nymex lost 2.35 cents to US$3.48 a pound. Shares in HudBay Minerals Inc. (TSX:HBM) dipped 31 cents or 2% to C$15.13.

Economic data on both sides of the border offered at least some reason for traders to be optimistic.

The Canadian dollar was down 0.24 of a cent at 97.39 cents US after a report from Statistics Canada that inflation started to track lower again in August after a big jump in July caused by the introduction of the HST in Ontario and British Columbia.

Inflation edged down one-tenth of a point to an annualized rate of 1.7% in August, as prices on a monthly basis fell 0.1 percentage points from July. Core inflation, which the Bank of Canada uses to gauge price pressures in the country, was flat at 1.6%, well below the central bank’s 2% target.

In other economic news, U.S. construction of new homes jumped 11% last month, rising above economist predictions that had looked for growth of less than 1%. The big jump fits into a pattern of recent economic reports topping modest forecasts, which has been enough to lift stocks sharply higher throughout the month.

In corporate developments, BHP Billiton extended its takeover offer for Potash Corp. of Saskatchewan (TSX:POT) until Nov. 18 after the Canadian Competition Bureau requested more information on the US$38.6-billion offer. Potash shares were down $1.98 at C$150.55.

Dynetek Industries Ltd. (TSX:DNK) shares popped almost 10% after it announced a joint venture with India-based S.V. Energy that it said would maximize its penetration in the Indian market for lightweight, compressed natural gas fuel storage cylinders and systems. It shares were up 2.5 cents to 28.5 cents.

Crescent Point Energy Corp. (TSX:CPG) announced late Monday that it would acquire exploratory properties in southern Alberta and Saskatchewan and also increased its production guidance for 2010. Still, its shares declined 76 cents to $36.63.

Stock in junior miner Metanor Resources Inc. (TSXV:MTO) tumbled 29% despite a new, higher resource calculation for its Barry gold deposit which estimates it contains 309,500 ounces of indicated resources and 471,950 ounces on an inferred basis. Its stock was off 20.5 cents at 49.5 cents.

In the U.S., cruise operator Carnival Corp. (NYSE:CCL) reported that more customers setting to sea for vacations helped third-quarter profits rise 22% to US$1.3 billion, up from $1.07 billion a year earlier. It also raised its full-year earnings forecast well above Wall Street’s expectations. Carnival stock was up 51 cents or 1.38% at US$37.57.

And Clorox Corp. (NYSE:CLX) said it will sell the division that produces car-care brands including Armor All and STP to private equity firm Avista Capital Partners for US$780 million in cash. Its stock dropped 89 cents or 1.32% to US$66.72.