CANADA STOCKS-TSX falls after Bernanke cools stimulus hope
* TSX down 28.64 points, or 0.2 pct, at 11,492.54 * Materials lead losses on lower gold, copper prices * BoC holds interest rates, maintains hawkish tone By Jon Cook TORONTO, July 17 (Reuters) - Canada's main stock index slid in volatile trade on Tuesday, led lower by mining shares, after Federal Reserve Chairman Ben Bernanke dampened expectations of further stimulus measures and the Bank of Canada left interest rates unchanged. Bernanke said the Fed stands ready to offer additional monetary support to the U.S. economy if needed, but gave no signs that the central bank was moving closer to a third round of bond purchases. Markets had hoped that Bernanke would signal that a third round of quantitative easing was imminent, following recent weak U.S. data on retail sales, manufacturing and employment. "The news tends to have a half-life of about an hour, and then we'll move on to the next worry or relief," said Paul Hand, managing director at RBC Capital Markets. Canada's resource-heavy index initially rose, along with commodity prices, but erased gains after Bernanke's comments in his semiannual testimony to Congress. The powerhouse materials sector, which includes miners, led the declines, tumbling 1.4 percent as gold and copper prices retreated. Losses were led by gold miners Barrick Gold, down 1.9 percent to C$34.71; Goldcorp, down 1.6 percent to C$33.72; Yamana Gold, down 3.1 percent to C$14.79; and Kinross Gold, off 4.5 percent at C$8.07. AuRico Gold plunged nearly 16 percent to C$6.46 after the company announced on Tuesday its chief executive, René Marion, resigned for health reasons and was replaced by Scott Perry. The news came a day after the small gold miner cut its 2012 production forecast. Shares of First Quantum Minerals Ltd fell 2.2 percent to C$16.60 on Tuesday after it said it has suspended operations at its Guelb Moghrein copper mine in the North African country of Mauritania due to a strike by some of its unionized workers. The oil and gas subindex was flat after initially rising 1 percent. Cenovus Energy was down 1 percent at C$33.17 and Baytex Energy tumbled 3 percent to C$40.90 after a price downgrade by the Canadian Imperial Bank of Commerce. "It looks like the oils and materials stocks are bottoming," said Hand. Around 11:30 a.m. EDT (1630 GMT), the Toronto Stock Exchange's S&P/TSX composite index was down 28.64 points, or 0.2 percent, at 11,492.54. It touched a session high at 11,571.31 shortly after the open. While Bernanke left the door open to further stimulus measures, the Bank of Canada left interest rates unchanged on Tuesday. Using mildly hawkish language that was unchanged from that used in June, the Canadian central bank hinted at higher interest rates, though it lowered economic growth forecasts and said the economy would take longer than it had previously expected to reach full capacity. "It is a bit of a surprise that the bank continues to doggedly stick to its tightening bias," said Douglas Porter, deputy chief economist at BMO Capital Markets. "Given all the global risks out there, I have a hard time believing the bank is going to be raising interest rates before the middle part of next year." In other company news, Héroux-Devtek Inc shares surged more than 40 percent to hit a life-high of C$11.75 after U.S. rival Precision Castparts Corp said it would buy Héroux-Devtek's aircraft parts business for about $295 million.
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