By Avinash P

Nov 21 (Reuters) - Canada's main stock index was muted

on Friday as broad-based gains were offset by a slide in

heavyweight oil stocks, while investors assessed domestic retail

sales data that pointed to sluggish consumer demand.

At 10:21 a.m. ET Toronto's S&P/TSX composite index

inched up 0.1% at 29,965.88 points and the index was headed for

its weakest weekly performance since early October.

The benchmark was steadying after a choppy session on

Thursday that saw it reverse early gains to end at a two-week

low, tracking Wall Street, as Nvidia's blockbuster earnings

failed to quell concerns about a potential AI bubble.

Data on Friday showed Canada's retail sales fell 0.7% in

September, a sign of cooling consumer demand despite recent data

pointing to moderating price pressures.

Meanwhile, New York Federal Reserve President John Williams,

a permanent voter on the Fed board, said the central bank can

still cut interest rates "in the near term" without putting its

inflation goal at risk.

Traders now see a more than 70% chance of the Fed cutting

the borrowing rate by 25 basis points next month, up from a 37%

probability seen earlier in the day, according to the CME

FedWatch Tool.

"It seems like the markets are relying on Fed cuts to

generate some continued momentum, which I don't think is

necessarily required...We have to keep in mind that interest

rates get cut usually due to economic weakness," said Josh

Sheluk, portfolio manager at Verecan Capital Management.

Most sectors edged higher, although energy stocks

fell over 1.5%, tracking weak crude prices, as investors priced

in more supply in the event of a potential deal to end Russia's

war in Ukraine.

Canadian equities have outperformed the U.S. benchmark so

far this year, with gold miners logging gains of over

112%, tracking a stellar run in prices of the yellow metal.

In corporate news, Dye & Durham ( DYNDF ) shot up 16% after a

report said it had been offered $272 million by Plantro to be

taken private.