TSX dips as gold losses weigh ahead of Brexit vote

By Fergal Smith

TORONTO (Reuters) - Canada's main stocks edged lower on Tuesday as losses for gold ahead of a vote by Britain on its European Union membership weighed on mining stocks, offsetting gains for financial and energy stocks.

The materials group, which includes precious and base metals miners and fertilizer companies, lost 1.9 percent, including a 3 percent drop in shares of Barrick Gold Corp (Toronto:ABX.TO - News) to C$24.54.

Spot gold fell 1.9 percent as U.S. and European shares rose amid receding expectations that Britain could vote to leave the European Union in Thursday's referendum. [GOL/][MET/L]

Industrial stocks also lost ground, falling 0.9 percent as railway stocks retreated.

Canadian Pacific Railway Ltd (Toronto:CP.TO - News) slid 2.3 percent to C$159.30 after warning it expects revenue to fall about 12 percent in the second quarter from a year ago.

The Toronto Stock Exchange's S&P/TSX composite index (.GSPTSE) closed down 2.82 points, or 0.02 percent, at 14,012.32. Five of the index's 10 main groups ended lower.

The index has retreated 3 percent from a recent 10-month peak at 14,450.91 as the so-called Brexit risk weighed on global stocks.

It will require a further recovery in the price of oil for the TSX to reach new highs, said Bryden Teich, associate portfolio manager at Avenue Investment Management.

U.S. crude oil futures settled 52 cents lower at $48.85 a barrel. [O/R]

Still, some losses for oil were pared after rebels sabotaging Nigeria's crude exports denied a one-month ceasefire agreement, while the overall energy group rose 0.4 percent.

Suncor Energy Inc (Toronto:SU.TO - News) plans to make acquisitions in the North Sea and Eastern Canada to bolster its offshore upstream oil business as assets become available due to the slump in global oil prices, three sources familiar with the process told Reuters.

Its shares rose 0.5 percent to C$34.70.

Royal Bank of Canada (Toronto:RY.TO - News) advanced 0.8 percent to C$78.62 and Brookfield Asset Management Inc (BAMa.TO) added 1.9 percent to C$44.14.

A reduction in Brexit risk has helped financial stocks rally after they were among the worst hit last week as risk appetite soured, said Bryden Teich, associate portfolio manager at Avenue Investment Management.

The overall financials group climbed 0.7 percent.

Canadian equity fund managers say they have raised their exposure to domestic stocks over recent months because of improved confidence in the local market, while keeping a close eye on the risk that would be posed by Britain's withdrawal from the European Union.

(Additional reporting by Alastair Sharp; Editing by Meredith Mazzilli and Alan Crosby)