TSX dips slightly to close the week

The June crude oil contract shed US$1.09 to US$49.62 a barrel after reaching a low of US$49.20 earlier in the day. The last time the commodity dipped below the US$50 mark was March 29, when it fell to US$49.51.

However, the fall in price didn’t drag down the S&P/TSX composite index much as it fell 11.08 points to 15,614.48, with the energy sector leading the way as oil and gas stocks gained an average of 0.73%.

Part of the energy sector’s performance can be attributed to a depreciating Canadian dollar, which slipped 0.18 of a U.S. cent to US74.05¢

A low loonie acts as “sort of a natural hedge,” meaning companies are getting more Canadian dollars per barrel, which are priced in U.S. dollars, says Patrick Blais, senior portfolio manager at Manulife Asset Management Ltd.

“That said, if the oil price persists below US$50 a barrel, we’ll probably see Canadian oil stocks pull back,” he adds.

In New York, the Dow Jones industrial average lost 30.95 points to 20,547.76, the S&P 500 composite index declined 7.15 points to 2,348.69 and the Nasdaq composite index dropped 6.26 points to 5,910.52.

Although there’s not much movement in the markets, there’s a lot of fretting over geopolitics, Blais says.

He pointed to France, where citizens head to the polls Sunday for the first round in the country’s presidential elections as an example. One of the top two candidates, National Front representative Marine Le Pen, is calling for France to leave the European Union and the euro currency behind should she win.

“You could very well get a fairly strong relief rally on Monday depending on the outcome as well as depending on how the market assesses the outcome,” Blais says.

Elsewhere in commodities, the June gold contract rose US$5.30 to US$1,289.10 an ounce, the May natural gas contract fell US5.8¢ to US$3.10 per mmBTU and the May copper contract gave up about half a cent to roughly US$2.54 a pound.