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The close: TSX ends lower as banks, gold miners weigh

Traders work on the floor of the New York Stock Exchange (NYSE) on Aug. 17.

Brendan McDermid/Reuters

Canada's benchmark stock index fell on Friday, led downward by losses in heavyweight bank shares and gold miners, with concerns about the impact of a stronger Canadian dollar and inflation creeping higher weighing on sentiment.

The Toronto Stock Exchange's S&P/TSX composite index ended down 81.31 points, or 0.54 per cent, at 14,952.33. Healthcare was the only group out of the index's 10 key industry sectors that finished higher.

The materials group was down 1.1 per cent. Gold prices were little changed after jumping to their highest in more than nine months on Friday as the U.S. dollar retreated on political uncertainty in the United States and a suspected Islamist militant attack in Spain boosted bullion's safe-haven appeal.

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Barrick Gold erased early gains, falling 1.9 per cent to $20.95. Agnico Eagle Mines Ltd. dropped 1.2 per cent to $58.92.

Manulife Financial Corp fell 2.4 per cent to $24.50, while Bank of Montreal and Royal Bank of Canada both slipped 0.3 per cent. The overall financials group declined 0.5 per cent.

U.S. stocks closed lower after another volatile session on Friday as the latest White House shake-up kept investors jittery about the outlook for the Trump agenda.

The Dow Jones Industrial Average fell 76.22 points, or 0.35 per cent, to 21,674.51, the S&P 500 lost 4.46 points, or 0.18 per cent, to 2,425.55 and the Nasdaq Composite dropped 5.39 points, or 0.09 per cent, to 6,216.53.

The White House announced President Donald Trump fired chief strategist Steve Bannon on Friday. Mr. Bannon is known as an economic nationalist and an advocate of "America First" policies. However, critics have accused him of harboring anti-Semitic and white nationalist sentiments.

Stocks began the day lower but reversed course as reports of Mr. Bannon's departure began to circulate.

"There are still question marks on what this means and what other shoes are to drop, like other personnel of note," said Mark Luschini, chief investment strategist at Janney Montgomery Scott in Philadelphia.

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"This is noteworthy, but it's not necessarily economic and therefore the market is viewing it as a positive but only marginally positive, as it doesn't put money in anybody's pocket in the way tax reform would."

All three major indexes are on track to post their worst monthly performance since October, a month before Trump's election as president.

The S&P 500 had posted its biggest percentage decline in three month on Thursday, hit by increased worries about the Trump administration's ability to push through its economic agenda.

There was concern about the possible departure of National Economic Council Director Gary Cohn on Thursday, and Mr. Trump disbanded two business councils on Wednesday.

Mr. Trump has alienated some corporate leaders and U.S. allies with his comments since violence in Charlottesville, Va., in the aftermath of a white nationalist protest against the removal of a Confederate statue.

Mr. Trump's campaign promises of tax cuts and higher infrastructure spending had helped the market rally, with the S&P climbing about 14 percent since the election. However, investors are getting increasingly worried about Trump's ability to implement his pro-growth agenda.

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Traders noted that volume has been light this week with many participants taking vacation before summer's end. "These last few weeks of August; there are lot of people on vacation, so markets are not nearly as liquid as they usually are," said Michael Matousek, head trader at U.S. Global Investors Inc in San Antonio.

Oil prices rose sharply on Friday, as the dollar fell and U.S. drillers cut rigs, feeding a rally that boosted global benchmark Brent crude to a weekly gain while U.S. crude was virtually flat on the week.

U.S. energy firms cut oil rigs for a second week in three, the Baker Hughes energy services firm reported, with drillers cutting spending plans in reaction to declining crude prices.

Drillers cut five oil rigs in the week to Aug. 18, bringing the total count down to 763, Baker Hughes said.

Earlier in the week, government data had suggested that crude output in the United States was still rising.

WTI crude futures for September delivery rose $1.42 to $48.51 a barrel, a 3 percent gain. Brent crude futures for October delivery rose $1.69 to $52.72 a barrel, a 3.3-per-cent gain.

Brent and U.S. crude prices had both been headed for weekly declines of more than 2 per cent, but Friday's sharp rally left Brent with a 1.5-per-cent weekly gain while U.S. crude finished the week virtually flat, down just 0.3 per cent.

Tariq Zahir, founding member at Tyche Capital Advisors, warned that despite Friday's rise, fundamentals for oil remain bearish as U.S. driving season nears an end.

"The main question is whether we will continue to see the kind of inventory draws that may show the supply-demand balance is tightening over the next few weeks," said Gene McGillian, director of market research at Tradition Energy.

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