CANADA STOCKS-TSX dips to 2-1/2-week low as euro zone stirs fears

Mon Feb 4, 2013 11:12am EST
 
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* TSX down 44.30 points, or 0.3 percent, at 12,725.53
    * Nine of 10 sectors weaker, BlackBerry jumps 10 pct

    By Claire Sibonney
    TORONTO, Feb 4 (Reuters) - Canadian shares dropped to their
weakest level in 2-1/2 weeks on Monday after political
uncertainty in Spain and Italy reminded investors that there
were still many risks ahead for the euro zone and dampened
appetite for riskier assets.
    Financial stocks were the biggest drag on the index, falling
0.62 percent. Royal Bank of Canada was down 0.9 percent
to C$61.97, and Toronto-Dominion Bank slipped 0.6
percent to C$83.07.
    "From a global perspective and from a North American
perspective ... all markets right now are overbought. It's time
for a short term pullback," said Keith Richards, portfolio
manager and technical analyst at ValueTrend Wealth Management in
Barrie, Ontario.
    He noted many of the country's big banks were encountering
significant technical resistance after a recent rally which took
the index of Toronto's financial services stocks to
its highest level since April, 2011.
    Catalysts for the fall on Monday included Spain's opposition
Socialist Party calling on Prime Minister Mariano Rajoy to
resign over a corruption scandal, as an opinion poll showed the
lowest support on record for his center-right People's Party.
 
    In Italy, former prime minister Silvio Berlusconi, one of
the top candidates in this month's general election, is seeing a
resurgence in popularity which threatens the reforms implemented
by the outgoing technocrat government. 
    At 10:34 a.m. (1534 GMT) The Toronto Stock Exchange's
S&P/TSX composite index was down 44.30 points, or 0.34
percent, at 12,725.53. Earlier, the index fell as low as
12,668.81, its softest level since Jan. 17.
    Nine of the 10 sectors were weaker, including energy and
materials, dragged down by a drop in commodity prices.
    Technology shares rose 2.4 percent, led by a rebound in
BlackBerry.
    BlackBerry was the most influential advancer in early
trading, jumping 10 percent to C$14.31 after Bernstein Research
said it was upgrading the stock to "outperform" following last
week's launch of the company's new line of BlackBerry
smartphones.