TSX lower again as oil slide continues, now below $56
Rally last week added 5% to Toronto stock prices
The Toronto stock market ended the rally it began last week, falling Monday as oil prices resumed their decline.
The energy sector was down 2.66 per cent, followed by metals and mining stocks, which were 1.35 per cent lower.
The Canadian dollar was down 0.23 of a cent to 85.92 cents US.
The TSX had gained 736 points or 5.36 per cent last week, ending weeks of bad news for stock investors.
Oil prices seemed to stabilize and the Fed reassured markets that it would go slow on raising rates. Investors picked up beaten-down stocks at what seemed like bargain prices.
But by Monday, oil was on its way downwards again. The West Texas Intermediate contract traded in New York fell $1.87 to $55.26 US a barrel and Brent crude was down $1.33 to $60.05.
In a speech at an energy summit in Abu Dhabi on Sunday, Saudi Petroleum Minister Ali Naimi defended OPEC’s decision at its Nov. 27 meeting to keep its production levels unchanged.
“As a policy for OPEC, and I convinced OPEC of this, even Mr al-Badri (the OPEC secretary general) is now convinced, it is not in the interest of OPEC producers to cut their production, whatever the price is," Naimi was quoted as saying.
"Whether it goes down to $20, $40, $50, $60, it is irrelevant," he said, saying oil will not soon rise to $100 a barrel level.
Oil hit $107 a barrel in June, but has plunged nearly 50 per cent since then due to low demand and stalled global growth.
The U.S. markets continued to rally, which saw the Dow rise by three per cent last week.
The Dow was up 157 points to 17,962, the S&P 500 was up eight points at 2078 and the Nasdaq rose by 16 points to 4791.
Traders called it a "Santa Claus rally," a burst of optimism ahead of the holiday in a week when trading is expected to be light.