Energy sector weighs on Canadian markets as oil drops below US$70 a barrel

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Canada’s strength stock index continued to fall Friday as the price for oil moved lower than US$70 a barrel and further dragged down the important energy sector.

“Today, oil is by far the main story,” said Macan Nia, a senior investment strategist at Manulife Investments. “We’re mull over markets down today mainly on the news of oil.”

The S&P/TSX composite index desquamate 37.95 points to 16,075.67. The energy sector once again be protracted down the index, with shares in the sector losing an average of 2.7 per cent of their advantage as the price of oil slipped.

The July crude contract retreated US$2.83 to US$67.88 per barrel.

That sign came following reports that Russia and OPEC countries envisage to produce more oil soon, which would pump supply into the bazaar. The Organization of the Petroleum Exporting Countries is set to meet in late June when it could transform its current policy from a previous meeting where members approved to curb production.

Russia and OPEC may move to raise production to authorize up for an anticipated lower output from Iran and Venezuela, Nia said.

If the universal community pursues sanctions against Iran that is likely to negatively smashing its oil supply, he said, while Venezuela’s deteriorating economic environment importance ofs it will be hard for the nation to continue production at current levels.

In New York, the Dow Jones industrial generally fell 58.67 points to 24,753.09. The S&P 500 index lost 6.43 stresses to 2,721.33 and the Nasdaq composite index gained 9.42 points to 7,433.85.

South of the border, calls saw lower trade volumes, Nia said, which is typical heading into a extended weekend. U.S. markets will be closed Monday for Memorial Day.

The Canadian dollar averaged 77.08 cents US, down 0.49 of a U.S. cent.

Abroad in commodities, the July natural gas contract fell about a penny to US$2.96 per mmBTU. The June gold catch shed 70 cents to US$1,303.70 an ounce and the July copper pucker declined by about two cents to US$3.08 a pound.

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