TORONTO - The Toronto stock market was lower Friday, pulled down by gold stocks, as traders took back gains in the precious metal amid continued geopolitical instability in Iraq.
The S&P/TSX composite index dipped 1.06 points at 15,111.16, after setting a new all-time record close Thursday, topping the mark set in June 2008, just before the financial crisis.
The Canadian dollar jumped sharply, up 0.52 of a cent to 92.92 cents US, on better than expected inflation data.
Gold prices have been steadily rising for the past month, as traders sought the safety of the precious metal over the potential volatility of stocks due to the building tensions in Iraq and Ukraine.
Gold stocks led decliners, falling by 1.46 per cent on the TSX as August gold bullion prices gained $2 to US$1,316.10 an ounce after closing up more than $40 in the previous session.
The uncertainty overseas also pushed the July crude oil contract up 62 cents to US$107.05 a barrel to a nearly nine-month high. The energy sector was the leading advancer on the TSX, up 0.44 per cent, as shares in TransGlobe saw an uptick of nearly five per cent or 36 cents to $8.04.
Iraq, one of the world's largest oil producers, is desperately trying to hold off extremists from taking over the country's largest oil refinery. By late Thursday, the two sides held different parts of the Beiji refinery, which extends over several square kilometres north of Baghdad.
On Thursday, U.S. President Barack Obama said he will send 300 U.S. military advisers to help with the conflict in Iraq, adding that it was possible that there will be "targeted and precise military action" in the future.
"It looks like it's not going to end soon," said Wes Mills, chief investment officer of Scotia Private Client Group.
On Wall Street, the Dow Jones industrials rose 50.17 points to 16,971.63 to break through its intraday record, the Nasdaq gained 5.11 points to 4,364.44, while the S&P 500 added 4.29 points to 1,963.77, amid strong jobs data from the U.S.
The U.S. Labor Department says unemployment fell in 20 states last month and nearly three-quarters of the states added jobs, as the country at large posted a fourth straight month of solid hiring. Nationwide, employers added 217,000 jobs in May, the fourth straight month of gains above 200,000, the first such stretch since 1999. The unemployment rate remained at 6.3 per cent, matching a five-year low.
In Canada, the pace of inflation rose to 2.3 per cent in May, up from two per cent in April, according to Statistics Canada, the first time the rate has topped the Bank of Canada's two per cent target in more than two years. Underlying core inflation was 1.7 per cent.
"The general thinking has been that rising inflation has been energy and food related, and temporary," said Wes Mills, chief investment officer at Scotia Private Client Group.
"That's largely true but there is some evidence that wages are starting to sneak up a little bit… There is starting to be some discussion that central banks are just treating this as noise and it may not be."
Statistics Canada also reported that retail sales rose for the fourth consecutive month in April, increasing 1.1 per cent to $41.6 billion as all but one of the subsectors posted gains.
Economists had expected a gain of 0.6 per cent, according to Thomson Reuters.
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