TORONTO -- The Toronto stock market headed for a sluggish start to the trading day as worries about the prospect of a U.S.-led military strike on Syria discouraged buyers.
Traders also took in record earnings from National Bank (TSX:NA). Canada's sixth-biggest bank posted net income of $419 million or $2.39 a diluted share, up from $353 million or $1.98 per share in the same 2012 period.
Revenue rose five per cent to $1.29 billion from $1.22 billion, beating expectations of $1.3 billion. Ex-items, net income was a record $391 million or $2.22 per diluted share, 16 cents higher than analysts expected.
One of the few positives on global markets was the price of oil, which ran up to its highest level in over two years on worries over supply disruptions. The October contract on the New York Mercantile Exchange gained $1.38 to US$110.39 a barrel.
The Canadian dollar was lower as investors avoided riskier assets such as commodity based currencies and equities, falling 0.22 of a cent to 95.25 cents US.
U.S. futures were in the red as the Dow Jones industrial futures were down five points to 14,753, the Nasdaq futures lost 0.2 of a point to 3,059.2 and the S&P 500 futures slipped 0.75 of a point to 1,627.5.
Worries about an attack grew after the United Nations' special envoy to Syria said that evidence suggests that some kind of chemical "substance" was used in Syria that may have killed more than 1,000 people. But Lakhdar Brahimi added that any military strike in response must first gain UN Security Council approval.
His comments came as a UN inspection team was investigating the alleged poison gas attack near Damascus on Aug. 21.
Concerns that western intervention in Syria's civil war could derail an already fragile global economic recovery sent stocks sharply lower Tuesday, with the TSX and the Dow plunging about 170 points. The showing left the TSX where it started August trading while the Dow hit its lowest level in two months.
Elsewhere on commodity markets, gold prices continued to benefit from risk aversion with the December bullion contract up $3.10 to US$1,423.30 an ounce.
Gold has also been in demand through its status as a haven in times of geopolitical uncertainty. Earlier, it had hit a three-month high of $1,434.
Copper prices declined with the September contract down two cents to US$3.31 a pound.
European bourses were also lower for a second day as London's FTSE 100 lost 0.57 per cent, Frankfurt's DAX fell 1.39 per cent while the Paris CAC 40 was off 0.53 per cent.
Elsewhere in Asia, Japan's Nikkei 225 index sank 1.5 per cent to its lowest finish in two months, while Hong Kong's Hang Seng dropped 1.6 per cent. Australia's S&P/ASX 200 slid 1.1 per cent.
