CANADA STOCKS-TSX falls on Draghi comments; miners pare losses
* TSX down 85.19 pts, or 0.7 pct, at 11,533.34 * Energy shares lead losses on weak earnings results * ECB's Draghi disappoints with no new stimulus By Jon Cook TORONTO, Aug 2 (Reuters) - Canada's main stock index slid in volatile trade on Thursday afternoon, led by energy shares, after European Central Bank President Mario Draghi disappointed investors by not announcing immediate action to push down borrowing costs for struggling euro zone members. Stocks tumbled and the euro erased gains after Draghi indicated the ECB may again start to buy government bonds, but only if euro zone members activated the euro zone's bailout funds to also buy bonds. Investors had hoped for more immediate action, particularly after the Federal Reserve on Wednesday embraced a similar wait-and-see approach and did not announce any new stimulus measures to boost U.S. growth. "The market was expecting something a bit more dramatic today," said Craig Fehr, Canadian market strategist at Edward Jones in St. Louis, Missouri. "It has grown a little weary of the talk and is looking for action at this point." Canada's heavily weighted energy sector led the broader index lower, falling 1.8 percent. A combination of lower oil prices and weak earnings results from Enbridge Inc and Petrominerales Ltd hurt energy shares. Enbridge slid 1 percent to C$40.11 after the pipeline operator reported a sharp fall in second-quarter profit due to losses on financial derivatives. Petrominerales Ltd shares plummeted more than 17 percent to C$7.64 after the oil and gas producer's second-quarter adjusted profit fell 66 percent on lower oil prices and sales. Around 2:30 p.m. (1830 GMT), the Toronto Stock Exchange's S&P/TSX composite index was down 85.19 points, or 0.7 percent, at 11,533.34. The index had touched a session low at 11,475.43 shortly after Draghi's remarks. Fehr said the market will "play a little wait and see" after Draghi's comments hinted that the ECB was "in the process of formulating a plan for some additional stimulus." Canada's influential materials sector, which includes miners, edged down 0.3 percent. Losses were led by Potash Corp , which fell 3.3 percent to C$42.48. Kinross Gold Corp tumbled 3.6 percent to C$7.72 after the company, one of Canada's largest gold miners, said on Wednesday it had replaced long-time CEO Tye Burt, who spearheaded the Red Back Mining acquisition, which has so far failed to live up to expectations. Kinross, which reports second-quarter results next week, named Paul Rollinson as the new chief executive. "The difference between the gold bullion price increase and the lack of increase in the gold stocks is money that's just not gone to shareholders - it's gone into dead projects and poor investment decisions," said Mike Newton, portfolio manager at Macquarie Private Wealth Inc. First Quantum Minerals Ltd, jumped 6.1 percent to C$19.03 after the base metal miner said on Wednesday its second-quarter profit fell slightly as lower copper prices and higher production costs outweighed higher sales volumes of copper and gold. On Thursday, National Bank Financial raised its price target on the miner to C$23 from C$21. Shares of New Gold Inc climbed 2.2 percent to C$10.22 a day after the miner reported a lower second-quarter profit, but the number was in line with expectations. In other earnings news, shares of Valeant Pharmaceuticals International rose 1.1 percent to C$47.66 after the drugmaker reported a second-quarter net loss on Thursday as costs rose, but adjusted cash earnings rose and the company raised its forecast for full-year cash results.
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