TSX hits 3-week low as interest rate jitters hit commodities

By Fergal Smith

(Reuters) - Canada's main stock index fell to a near three-week low on Thursday, with resource shares among the biggest decliners as commodity prices fell and economic data fueled worries the Federal Reserve would delay a move to interest rate cuts.

The Toronto Stock Exchange's S&P/TSX composite index ended down 145.97 points, or 0.7%, at 22,200.79, its lowest closing level since May 3.

"The entire commodity complex is trading lower due to hawkish comments from the U.S. Federal Reserve sparking fears that higher for longer interest rates could hurt global growth and keep the U.S. dollar elevated," said Brandon Michael, senior investment analyst at ABC Funds.

On Wednesday, minutes of the Fed's latest meeting showed U.S. central bank officials still had faith price pressures would ease, but slowly, due to disappointment over inflation reading.

Wall Street also fell, even as a strong revenue forecast for Nvidia prompted a surge in its shares.

"We still believe we are in a secular bull market," Michael said. "You could do exceptionally well if you are in the right areas of the market and have a little bit of patience."

The materials group fell 1.3% as gold and copper prices pulled back from recent record highs.

Energy was also a drag, falling 0.5%, as the price of oil settled 0.9% lower at $76.87 a barrel.

Toronto-Dominion Bank shares were down 1.6%. The bank reported better-than-expected quarterly earnings even as its U.S segment struggled amid probes related to its anti-money laundering program.

Canada is due on Monday to shorten the trade settlement period to one day from two days, keeping it aligned with U.S. trading. U.S. markets will move to the new standard, commonly called T+1, on Tuesday, following a market holiday.

(Reporting by Fergal Smith in Toronto and Khushi Singh in Bengaluru; Editing by Ravi Prakash Kumar and Diane Craft)