Source: The Canadian Press

The Toronto stock market closed slightly higher as gains in mining stocks balanced losses in energy stocks, which fell amid another slide in oil prices.

The S&P/TSX composite index was 18.31 points higher at 11,913.86, with financial stocks also weak following an earnings disappointment from Scotiabank (TSX:BNS).

The TSX Venture Exchange was up 2.46 points at 1,499.63.

Scotiabank’s third-quarter profit rose 14% from a year ago to $1.06 billion. Cash earnings came in at 99 cents a share, one cent less than analysts expected as earnings in the capital markets division tumbled 35% to $305 million due to a decline in trading revenues.


But the bank also reported a 21% increase in net income from its Canadian banking business. Its shares were down 65 cents at $51.25 but analysts noted that the bank still handed in a solid report.

“If you can make a billion dollars a quarter with your capital markets getting whacked, that’s a pretty impressive performance,” said Gavin Graham, global strategist at Excel Funds Management.

“The trading profits took a hit, but why this should be a surprise to anyone is a little remarkable given the fact the (U.S.) investment banks had all come out last month and said trading has been really awful.”

TD Bank (TSX:TD), which reports earnings on Thursday, was ahead 54 cents at $72.15.

The energy sector fell 0.56% as the September crude contract on the New York Mercantile Exchange fell $2.78 to US$71.92 a barrel, extending a month-long slump on demand worries that has carved 9% from oil prices. Suncor Energy (TSX:SU) fell 61 cents to C$32.31 while Canadian Natural Resources (TSX:CNQ) fell 25 cents to C$34.30.

The Canadian dollar was down 0.54 of a cent to a three-month low of 93.76 cents US. The drop followed a Statistics Canada report that said the Canadian economy continued to grow in the second quarter but at a much reduced pace from the January-March period. The agency said Tuesday that the economy grew at an annualized rate of 2% after expanding by 5.8% in the first quarter.

GDP growth slows to half a point in Q2: StatsCan


Economists had expected expansion in the neighbourhood of 2.5%, “however, the breakdown of the quarter produced no major nasty surprises, as slower government spending and housing were major factors behind the cool-down,” observed BMO Capital Markets deputy chief economist Doug Porter.

The market had earlier found lift from the U.S. Conference Board’s Consumer Confidence Index, which unexpectedly improved to 53.5 in August, up from a revised 51.0 in July. Economists surveyed by Thomson Reuters had expected a reading of 50.5. The reading comes after two straight months of declines.

But stock indexes weakened after the mid-afternoon release of the minutes from the last U.S. Federal Reserve meeting on interest rates earlier this month. At the meeting, officials signalled that they would consider going beyond a modest program to purchase government debt if necessary to boost the economy.

The minutes show the central bank recognized that the economy could need further stimulus beyond the debt purchases but did not spell out what new steps might be taken.

“The minutes also reflected a considerable diversity of opinion among participants as to both the near-term prospects for economic growth as well as the next actions for the Fed,” observed TD Bank senior economist James Marple.

“The considerable disagreement among participants about both the prospects for recovery and the course of future policy action shows that the Fed has entered into a Brave New World into where easy answers are harder and harder to come by and uncertainty is paramount.”

The TSX base metals sector rose 1.13% as September copper on the Nymex lost six cents to US$3.37 a pound. Teck Resources (TSX:TCK.B) gained 54 cents to C$35.67 and Equinox Minerals (TSX:EQN) climbed 17 cents to C$4.76.

A major weight on the TSX was Research In Motion Ltd. (TSX:RIM). The Blackberry maker has had a dreadful month with its shares falling about 23% in August as countries such as India and Saudi Arabia demand access to corporate email and instant messaging. Investors also worry RIM isn’t gaining market share in the consumer market. It shares fell $2.67 on Tuesday to $45.70.

Gold stocks advanced alongside precious metal prices. The December bullion contract in New York was ahead $11.10 to US$1,250.30 an ounce. Goldcorp Inc. (TSX:G) rose 89 cents to C$47.30 while Barrick Gold Corp. (TSX:ABX) was up 74 cents at C$49.95.

New York’s Dow Jones industrial average inched up 4.99 points to 10,014.72, the Nasdaq composite index declined 5.94 points to 2,114.03 while the S&P 500 index added 0.41 of a point to 1,049.33.

The TSX gained 1.7% during August but the Dow industrials fell 4.3%, its worst August since 2001.

The week’s U.S. economic reports will also include the monthly manufacturing and services surveys from the Institute of Supply Management on Wednesday and the U.S. government’s employment report for August on Friday.

In other corporate news, Magna International closed a controversial stock buyout deal Tuesday, putting an end to nearly four months of shareholder wrangling. Shares in the auto parts giant (TSX:MG.A) added $3.43 or 4.3% to $83.04 after an Ontario court upheld approval of the plan, which will see company founder Frank Stronach receive more than $1 billion to give up his voting control of the company.

Opposed shareholders said they won’t appeal the ruling.

Alimentation Couche-Tard Inc. (TSX:ATD.B), Canada’s largest convenience store operator, has extended its hostile bid to acquire U.S.-based Casey’s General Stores Inc. (Nasdaq:CASY) until Sept. 30 amid dwindling committed support from Casey’s shareholders. The Montreal-area company’s shares declined 11 cents to $22.89.

Women’s clothing retailer Reitmans Ltd. (TSX:RET.A) posted a profit of $39.8 million in its most recent quarter, up from $26.4 million a year ago. Its shares were off 49 cents at $18.79.