A man walks past an old Toronto Stock Exchange sign in Toronto on June 23, 2014.Mark Blinch/Reuters
The Toronto stock market fell into the red Monday as it looked for direction amid a shortened trading week, with little news on tap ahead of the Christmas break.
The S&P/TSX composite index dipped 33.68 points to 14,434.58, pulled down by lower energy and gold stocks.
The Canadian dollar was down 0.24 of a cent to 85.91 cents (U.S.).
Wall Street was higher, with the Dow Jones gaining 85.94 points to 17,890.74. The Nasdaq jumped 7.96 points to 4,773.34 and the S&P 500 index added 1.5 points to 2,072.15.
Toronto and New York markets had soared last week, with the TSX gaining 736 points or 5.36 per cent to close at 14,468.26. It set a new daily volume record on Friday, with more than 1.5 billion shares traded. The previous record had set on Dec. 19, 2008, with 896 million shares traded.
The Dow Jones also finished the week ahead 524 points or three per cent.
Buying sentiment on Wall Street got a big lift last week after the U.S. Federal Reserve said it will be "patient" in deciding when to hike interest rates. Short-term rates have been near zero since the 2008 financial collapse and have helped aid in the recovery of stock markets. In recent months, investors have come around to accepting that the central bank will move to start hiking rates next year, likely to be around the middle of 2015.
Traders are facing a much shorter trading week with Toronto and New York closing at 1 p.m. on Wednesday for Christmas Eve. Toronto will be closed until Monday while New York reopens Friday.
Edward Jones Canadian markets strategist Craig Fehr said the short week will likely results in "incredibly light" trading volumes.
"In and of itself, that suggests there is a potential for big market swings or increased market volatility if indeed big news breaks," said Fehr from St. Louis, Mo.
"At the same time, barring any sort of any meaningful news or surprises coming from overseas markets, I wouldn't expect it to be a tremendous amount of market drivers this week. We're largely going to see investors move to the sidelines."
The only major economic data expected this week will be when Canada and the U.S. releases their latest figures on gross domestic product on Tuesday.
Consensus estimates suggest the Canadian economic growth slowed in October, advancing only 0.1 per cent compared with September's growth of 0.4 per cent, month-over-month.
Fehr said the Canadian figures should continue to show a trend of modest growth going into 2015, but still lagging behind the U.S.
With little else, traders will continue to keep an eye on crude prices which had hit US$107 a barrel in June but have plunged nearly 50 per cent since then due to low demand, especially after Saudi Arabia and other members of the Organization of Petroleum Exporting Countries (OPEC) agreed to maintain production levels.
Crude prices seemed stabilize last week, suggesting that they may have found a floor in prices.
The January crude contract on the New York Mercantile Exchange fell $1.38 to $55.75 (U.S.) a barrel, with the energy sector coming in as one of the biggest decliners on the TSX, down 2.24 per cent.
Despite the declining oil prices, Fehr noted that this doesn't necessarily mean it'll be all bad news for the Toronto market, which is heavily weighted to oil and other resources.
"I think that's a little bit of a reflection that we're seeing a break from just the performance of the stock index relative to commodities. That suggests investors are finding value in this market," Fehr said.
"That's a very telling signal that investors are starting to become a little more opportunistic in this environment even despite the fact that oil prices could remain under pressure."
February bullion declined $6.90 to $1,89.10 an ounce, as the gold sector led TSX decliners, falling by 2.56 per cent. March copper was unchanged at $2.88 a pound.