Toronto's main stock index kicks off week with lacklustre start
By Maiya Keidan
TORONTO (Reuters) - Canada's main stock index fell modestly on Monday, dragged down by energy and rate-sensitive real estate and technology stocks ahead of major central bank meetings and earnings later this week.
At provisional close on Monday, the Toronto Stock Exchange's S&P/TSX composite index was down 21.44 points, or 0.1%, at 20,615.10.
"It's all about earnings and we're seeing people sit on their hands," said Diana Avigdor, portfolio manager and head of trading at Barometer Capital Management. "Quite a lot of companies are starting to report in Canada."
Among those companies is e-commerce giant Shopify Inc, which was down 1.9% on Monday and reports first-quarter earnings on Thursday.
Shopify dragged technology companies down 0.1%.
Later in the week, the U.S. Federal Reserve is expected to announce another rate hike on Wednesday and the European Central Bank is expected to lift borrowing costs by 25 basis points.
Against the potential for hikes, rate-sensitive real estate stocks were down slightly, falling 0.4% on Monday.
Materials stocks, which include precious metals, ended the day up 0.1% while industrials rose 0.5% and utilities gained 0.1%.
The energy sector dragged down Toronto's main index, falling 1.3%, as investors continued to fear recession.
"Energy can't find it's footing," said Avigdor. "The companies are doing OK; the actual commodity is kind of languishing in no man's land the last little while. The narrative is that a recession will dampen demand and there seems to be enough supply."
Oil prices also dropped by a dollar a barrel on Monday after weak economic data out of China.
Fewer traders worldwide were at their screens on Monday as markets in Europe were closed for May Day.
(Reporting by Maiya Keidan in Toronto; Editing by Matthew Lewis)