Cautious investors put cap on TSX gains
By Claire Sibonney
TORONTO (Reuters) - Toronto's main stock index ended little changed on Monday, as a lack of a clear resolution to Europe's financial crisis weighed on commodity prices, offsetting the positive effect of optimism for upcoming U.S. corporate earnings.
Teck Resources TCKb.TO was the heaviest laggard on the index, down 1.8 percent to C$37.65, followed by Talisman Energy TLM.TO, down 2.2 percent to C$12.40, and Potash Corp (POT.TO: Quote), off 0.8 percent to C$42.62.
After a solid start to equity markets in the first week of 2012, investors have grown more skeptical about whether European politicians can craft a plan that moves the region closer to solving its debt crisis. This week's bond auctions by Italy and Spain will test the willingness of investors to pump more money into the region's troubled sovereigns.
Investors also heard that German Chancellor Angela Merkel and French President Nicolas Sarkozy warned Greece on Monday it will get no more bailout funds until it agrees with creditor banks on a bond swap and pressed for an early deal to avert a potential default - though the admonishment had little impact on stocks. <ID:L6E8C9392>
"The shock and awe value of the headlines is over. They're not making waves any more, so that's good news," said Barry Schwartz, vice-president and portfolio manager at Baskin Financial Services.
After finishing last week nearly 2 percent higher thanks to a slew of positive U.S. economic news, the Toronto Stock Exchange's S&P/TSX composite index .GSPTSE ended Monday up just 8.08 points, or 0.07 percent, at 12,196.72.
"(The European debt crisis) has done too much damage from a technical perspective so it needs more work other than just rhetoric," said Sid Mokhtari, market technician and director, institutional equity research, CIBC World Markets. Continued...