REFILE-CANADA STOCKS-TSX dips as bank weakness offsets gold rise

Wed Sep 2, 2009 10:58am EDT
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 (Refiles to fix spelling error in headline)  
 * TSX falls 0.13 percent to 10,676.32
 * Profit-taking in financials outguns rally in gold miners
 * Healthcare up 3.73 pct as MDS sells unit, plans more
 (Adds details)
 By Ka Yan Ng
 TORONTO, Sept 2 (Reuters) - Toronto's main stock index was
lower on Wednesday morning as weak oil prices and concern about
the strength of the economic recovery outgunned strength in
gold-mining shares.
 Investors continued to take profits in financial stocks
after Canadian banks reported strong earnings the previous
week, taking the financial group 1.1 percent lower. The group
rose about 6 percent last week, and has handed back a slice of
those gains in the past two sessions.
 Leading decliners included Royal Bank of Canada RY.TO,
down 1.1 percent at C$54.93, Toronto Dominion Bank TD.TO down
1.4 percent at C$65.11, and Manulife Financial MFC.TO down
1.2 percent at C$21.43.
 "The big banking groups had a run, and expectations are
that a pullback is logical and needed," said John Ing,
president of Maison Placements Canada.
 At 10:25 a.m. (1425 GMT), the S&P/TSX composite index
.GSPTSE was down 13.46 points, or 0.13 percent, at 10,676.32.
Five of the index's 10 main sectors were lower, including a 0.5
percent decline in the weighty oil and gas group as the price
of oil slipped below $68 a barrel.
 Private-sector job data showed U.S. companies cut more jobs
than expected in August, pressuring already-fragile sentiment
about the depth of the economic recovery.
 The index's materials group, home to gold miners, was a
bright spot that helped limit the decline. The price of the
gold hit a four-week high of $966.20 an ounce as concerns over
falling equities pushed the precious metal through technical
resistance levels in the wake of U.S. jobs data, and amid
weakness in the dollar index. [ID:nL2167301]
 "Golds are the big feature. With the pullback of the
markets, gold has been a beneficiary of the move," Ing said.
"Expectations are that a lower U.S. dollar, together with the
prospect of even more spending by the (U.S.) government is
awfully good for gold and the gold stocks."
 The healthcare group was also a big advancer, up 3.73
percent as MDS Inc MDS.TO said it had struck a deal to sell
its Analytical Technologies division and will seek buyers for
its Pharma division as it narrows its scope to concentrate
solely on the medical isotope field. MDS soared more than 20
percent to C$7.76. [ID:nN02528673]
 ($1+$1.11 Canadian)
 (Reporting by Ka Yan Ng; editing by Peter Galloway)