CANADA STOCKS-TSX falls as Rona bid dropped; Fed euphoria fades

Mon Sep 17, 2012 10:46am EDT
 
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* TSX down 40.98 points, or 0.33 percent, at 12,457.90
    * Rona down more than 10 pct as Lowe's walks away from bid
    * Energy stocks limit losses as crude steadies

    By Alastair Sharp
    TORONTO, Sept 17 (Reuters) - Canada's main stock index fell
on Monday, hurt by a drop in home improvement retailer Rona Inc
 after a potential suitor walked away and fading
investor euphoria over last week's aggressive move by the U.S.
Federal Reserve to spur growth.
    Rona fell more than 10 percent to C$11.47 after Lowe's Cos
Inc withdrew its C$1.8 billion ($1.86 billion) bid for
the Quebec-based company. 
    The sharp sell-off in Rona was one of the heaviest weights
on the Toronto Stock Exchange's S&P/TSX composite index
, which was down 40.98 points, or 0.33 percent, at
12,457.90 by 10:20 a.m. (1420 GMT).
    The index's fall followed several strong sessions of gains
late last week on the back of the U.S. Federal Reserve's fresh
round of monetary stimulus.  The index hit a five-month high on
Friday.
    "It's just some sober reassessment of last week's events, no
more, no less," said John Ing, president of Maison Placements
Canada. "With oil strong there is interest (in energy stocks)
and banks are benefiting from the likelihood of low interest
rates to stay until infinity," he added.
    A 0.45 percent rise in Canadian energy stocks played the
biggest role of any sector in preventing the index from falling
further.
    Major producer and refiner Suncor Energy Inc gained
0.9 percent to C$34.63, while smaller Crescent Point Energy Corp
 added 2.2 percent to C$43.01 as the price of crude
steadied after days of gains. 
    After starting stronger, the country's biggest banks and
insurers turned negative, with Manulife Financial Corp 
down 1.3 percent at C$12.46 and Royal Bank of Canada off
0.4 percent at C$55.87.
    Barrick Gold Corp and Teck Resources Ltd 
were among the heaviest weights, down 1 percent to C$40.76 and
off 2.1 percent at C$32.30 respectively, after moving up
strongly last week.