TSX dips as financials drag; gold stocks rally

By Fergal Smith

TORONTO (Reuters) - Canada's main stock index edged slightly lower on Thursday as losses for financials and other sectors offset gains for gold miners and Bombardier Inc after the company won a large plane order.

The index has rallied 20 percent since January but has been unable to climb back above the 14,000 threshold. It moved back in reach of that level on Thursday before turning lower as losses on Wall Street deepened after the Bank of Japan's shocking call to cap monetary stimulus continued to rattle investors.

The rally in gold and oil helped the index outperform U.S. stock markets, according to Colin Cieszynski, senior market analyst at CMC Markets Canada.

Spot gold rose 1.8 percent, while oil hit 2016 highs for a third straight day as a weaker dollar had investors shrugging off record high U.S. crude inventories. U.S. crude prices settled at $46.03 a barrel, up 1.54 percent. [O/R]

The Toronto Stock Exchange's S&P/TSX composite index fell 1.23 points, or 0.01 percent, to 13,886.43. Six of the index's 10 main groups ended lower.

Cieszynski expects crude oil to "level off" as it approaches $50 a barrel, making it difficult for the index to push above the 14,000 threshold.

The heavyweight financials group fell 0.5 percent, including a 1.7 percent drop in the shares of Manulife Financial Corp to C$18.38.

Potash Corp of Saskatchewan fell nearly 4 percent to C$22.17. The world's biggest fertilizer company by capacity cut its full-year profit forecast due to weak demand and lower prices.

The energy group fell 0.2 percent despite the rally in oil prices. It included a 2.1 percent drop in the shares of Canadian Natural Resources Ltd to C$37.89.

Barrick Gold Corp rose 5 percent to C$22.03, while Goldcorp Inc was up 5.3 percent at C$23.80 after reporting on Wednesday better-than-expected earnings.

The overall materials group, which includes precious and base metals miners and fertilizer companies, added 2.2 percent.

Bombardier Inc rose 1.5 percent to C$2.04, having touched its highest since July 8 last year of C$2.28. The company scored a major order for its new CSeries passenger jets from Delta Air Lines Inc.

Shares of BCE Inc rose 1.1 percent to C$58.83 after the telecom and media company reported a slightly better-than-expected quarterly profit as it added more wireless customers and earned more for each one.

(Reporting by Fergal Smith; Editing by Tom Brown and Chris Reese)