Toronto stocks seen opening lower on soft energy

Tag : Metal Cushion

TORONTO (Reuters) - Toronto's main stock market index was seenopening lower on Tuesday as soft energy prices and weak resultsfrom the country's top railway companies weigh on the market.
Also affecting investor psyche are weak results from a string ofU.S. bellwether issues including Apple Inc and Wachovia Corp .
"It's going to be a very sloppy market," said John Ing, presidentat Maison Placements Canada. "The opening is Wachovia's loss andthat will weigh on the markets."
The Toronto Stock Exchange's S&P/TSX composite index begins the dayat 13,689.19 after jumping about 1 percent in the previous sessionon a takeover bid for TransAlta Corp and rising commodity prices.
Industrial shares are expected to take a hit as both CanadianNational Railway and Canadian Pacific Railway reported lowersecond-quarter results.
Canadian Pacific reported a nearly 40 percent drop in earnings inthe second quarter on Tuesday, due to a slowing U.S. economy andrising fuel costs.
On Monday, Canadian National posted an 11 percent drop insecond-quarter earnings, saying the stronger Canadian dollar andhigher fuel costs crimped its bottom line.
Wachovia will also ratchet up the fears in the financial sectorafter the fourth-largest U.S. bank posted an $8.86 billionsecond-quarter loss, slashed its dividend and announced 6,350 jobcuts after losses tied to mortgages soared.
Wachovia's losses will surely be a disappointment to investors whowere just starting to breathe easy following stronger-than-expectedresults recently from other U.S. financial institutions.
Weak energy prices are also expected to weigh on the resource-heavymarket as the price for the key U.S. crude oil dropped 0.9 percentto settle under $130 a barrel as a tropical storm was likely tomiss key U.S. oil and gas facilities, diminishing supply concerns.
"Energy is what people look at when they come in in the morning andwatch where the storm tracks," said Ing. "That affects near-termmore than anything else."
Gold could help cushion some of the blow as the price for theprecious metal rose 0.7 percent to $968.60 an ounce on the back ofthe weak U.S. dollar and soft global equity markets.
Investors will also take time to digest the latest Canadianeconomic numbers that showed Canadian retail sales rose asmaller-than-expected 0.4 percent in May from April due to weaksales by clothing stores.
($1=$1.01 Canadian)
(Reporting by Scott Anderson; Editing by Frank McGurty)