Toronto stocks finished lower on Wednesday as the market tried to figure out whether Colin Powell’s speech at the United Nations had increased the odds of a U.S.-led military strike against Iraq.

Powell unveiled audio tapes and satellite photos, which he said backed up the view that Iraq had actively concealed its banned weapons programs from U.N. inspectors.

The S&P/TSX composite index slipped 23.93 points to close at its session low of 6,521.

The gold index fell 2.9% as the price of bullion pulled back from six-year highs reached early in the day. Leading the fall were Kinross Gold down 37¢ at $11.63, and Glamis Gold, which fell $1.04 to $18.35. Barrick Gold shed 61¢ to $24.96.

CAE shares rose 8¢ to $4.95, after it reported a $31.5-million profit in its most recent quarter, down 2% from a year before but better than analysts expected.

Shares of Canada Life Financial, the target of a $6.4 billion takeover bid by Manulife Financial, rose 25¢ to $40.65 as the insurer more than tripled its profits to $131 million in the fourth quarter.

Higher nickel prices and rising production helped Falconbridge earn a $33.1 million profit in the fourth quarter, reversing a loss last year. Its shares were 10¢ higher to $16.75.

Shares in logistics technology company Descartes Systems Group fell 9¢ to $4.51 after it announced a US$10 million goodwill writedown.

Market momentum was negative as declining issues outpaced advancers 632 to 460. Volume was light as 195 million shares worth $2.2 billion changed hands.

The S&P/TSX Venture Composite Index closed down 14.24 points at 1,115.78. Trading was heavy on a volume of 46.5 million shares worth $18.8 million, with 208 advances, 223 declines and 539 issues unchanged. American Bonanza Gold Mining Corp. was the most active issue, closing down 2¢ at 35¢ on volume of 2.1 million shares.

In New York, initial positive reaction to Powell’s case for disarming Iraq was deflated by investor concerns about the big risks a war poses and sent U.S. markets to lower closes.

The Dow Jones industrial average slipped 28.11 points to 7,985.18, while the tech heavy Nasdaq composite index dipped 4.65 points to close at 1,301.50. The S&P 500 was down 4.61 at 843.59.

The Canadian dollar finished lower against the U.S. dollar on Wednesday, as the greenback got a boost from Powell’s speech. The loonie slipped to US65.74¢ from US66.01¢ at Tuesday’s close.