CANADA STOCKS-TSX steady as energy gains offset Goldcorp decline

Wed Jul 11, 2012 11:28am EDT
 
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* TSX up 1.24 points at 11,513.46
    * Energy gains offset mining losses
    * Oil prices rise ahead of Fed minutes
    * Goldcorp Inc shares plunge 9 pct

    By Jon Cook
    TORONTO, July 11 (Reuters) - Canadian stocks were little
changed on Wednesday as gains by energy shares, on hopes of more
stimulus from the U.S. Federal Reserve, offset mining losses
after Canada's second-largest gold producer, Goldcorp Inc
, lowered its 2012 outlook.
    Investors were looking ahead to the release of minutes from
the Federal Open Market Committee's (FOMC) June meeting for
insight on what may be needed to trigger a third round of
monetary stimulus.
    The Fed last week decided to extend a bond
maturity-extension program called Operation Twist, but the
market was anticipating more easing measures following Friday's
disappointing jobs report. 
    Seven of Canada's 10 main sectors rose, led by the
heavyweight energy group, which advanced 1 percent as U.S. oil
prices climbed on stimulus hopes and on expectations U.S.
inventory data on Wednesday would show crude stocks shrank
further. 
    "There's more green than we've seen the last four days,"
said John Kinsey, portfolio manager at Caldwell Securities Ltd.
"It's probably the normal reaction to four down days in a row."
    The biggest movers on the energy side included: Cenovus
Energy, up 2.3 percent at C$32.99, Suncor Energy
, which climbed 1.5 percent to C$29.15, and Enbridge Inc
, up 1 percent at C$40.59.
    However, gains were pressured by Goldcorp, whose shares
plunged 9 percent to C$34.24 after the influential gold miner
lowered its 2012 gold production outlook on Tuesday due to
operational problems at its Red Lake mine in Ontario and its
Penasquito mine in Mexico. 
    "Obviously today is not a good day," said Kinsey. "These are
two of their best mines and they reduced production output
substantially at both of them, so that's going to hurt."
    The Goldcorp news had a negative impact on the
heavily-weighted materials sub-index, which fell 1.5 percent.
Barrick Gold, the world's top gold miner, slumped 2.2
percent to C$35.57. 
    At 11:06 a.m. EDT (1506 GMT), the Toronto Stock Exchange's
S&P/TSX composite index was up 1.24 points at
11,513.46. Thin summer volume exaggerated moves and kept markets
volatile.
    U.S. Commerce Department data on Wednesday showed the U.S.
trade deficit narrowed slightly by 3.8 percent in May as a rise
in exports, including those bound for Europe and China, eased
the pain of a slowdown in the broader economy. 
    Earlier this month, a private survey showed activity at U.S.
factories declining in June, with new orders falling, including
those for exports.
    Canadian financial shares edged up 0.4 percent, led by the
major lenders. Royal Bank of Canada shares edged up 0.3
percent to $C52.66, while Toronto-Dominion Bank rose 0.5
percent to C$79.95. 
    However, Europe's crisis continues to fester, and on
Wednesday Spanish Prime Minister Mariano Rajoy announced a
swathe of new taxes and spending cuts to meet tough targets
agreed with Europe. 
    Concerns about Spain were heightened by lack of clarity from
euro zone finance ministers on implementing the measures and
questions about when Germany's Constitutional Court would give
its verdict on the new regional bailout fund, known as the
European Stability Mechanism (ESM).