Energy weakness, Couche-Tard news push S&P/TSX composite lower; U.S. markets mixed

A street sign along Bay Street in Toronto's financial district is shown on Tuesday, January 12, 2021. THE CANADIAN PRESS/Nathan Denette

TORONTO - Canada's main stock index dipped on energy weakness and a negative reaction to a potential Alimentation Couche-Tard acquisition.

The S&P/TSX composite index closed down 51.06 points to 17,934.74.

The second impeachment of U.S. President Donald Trump had little impact on market sentiment, which climbed on anticipation of further fiscal stimulus that will be unveiled Thursday by President-elect Joe Biden, along with the COVID-19 vaccine ramp-up.

"This is emboldening calls for a rapid recovery later this year and a swift return to normalcy and largely countering some of the near-term risks at hand," said Candice Bangsund, portfolio manager for Fiera Capital.

January has seen impressive market gains stemming for the Democratic sweep in the U.S. and the likelihood for further fiscal stimulus.

The fiscal package is expected to cost trillions of dollars. Its passage is likely to pass in Congress with incoming Vice-President Kamala Harris breaking a tie in the Senate and Democrats holding a slim majority in the House of Representatives.

In New York, the Dow Jones industrial average was down 8.22 points at 31,060.47. The S&P 500 index was up 8.65 points at 3,809.84, while the Nasdaq composite was up 56.52 points at 13,128.95.

The consumer staples sector was the weakest on the day, falling 2.8 per cent as Alimentation Couche-Tard shares plunged 10.2 per cent after the retailer confirmed it has made a $25-billion offer for French-based grocery chain Carrefour SA.

Materials lost 1.6 per cent even though gold prices rose on the inflationary pressures that are expected to accompany a fiscal package.

The February gold contract was up US$10.70 at US$1,854.90 an ounce and the March copper contract was up 1.1 cents at nearly US$3.62 a pound.

Energy lost 1.3 per cent on a drop in crude oil prices as shares of Vermilion Energy Inc. decreased 3.4 per cent and Cenovus Energy Inc. was down 3.2 per cent.

The February crude oil contract was down 30 cents at US$52.91 per barrel and the February natural gas contract was down 2.6 cents at US$2.73 per mmBTU.

Bangsund said a positive U.S. crude inventory report was largely overshadowed by higher supplies of refined product, while a stronger U.S. dollar also weighed on prices.

The Canadian dollar traded for 78.68 cents US compared with 78.46 cents US on Tuesday.

Stock markets were modestly lower for the week, but Bangsund said sentiment "remains fairly buoyant and well-supported given the fact that investors are looking through the near-term headwinds towards a brighter outlook later in 2021."

Health care led the TSX, gaining 5.4 per cent with Bausch Health Companies Inc. up 10.3 per cent and Cronos Group Inc. 9.5 per cent higher.

Technology moved up with shares of Lightspeed POS Inc. increasing eight per cent.

This report by The Canadian Press was first published Jan. 13, 2021.

Companies in this story: (TSX:ATD.B, TSX:VET, TSX:CVE, TSX:BHC, TSX:CRON, TSX:LSPD, TSX:GSPTSE, TSX:CADUSD=X)

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