3 Min Read
* TSX off off 2.07 points at 12,679.35
* Fed to pump $600 bln into U.S. economy
* Focus on Potash Corp, federal decision (Updates to afternoon, adds quote)
By Jennifer Kwan
TORONTO, Nov 3 (Reuters) - Toronto's main stock index struggled to find direction on Wednesday after the U.S. Federal Reserve committed to buy $600 billion more in government bonds in an attempt to breathe new life into the U.S. economy. [ID:nN03287174]
The U.S. central bank launched a controversial new policy on Wednesday, committing to buy about $75 billion in longer-term Treasury bonds per month. [ID:nN03287174]
The decision is aimed at further lowering borrowing costs for consumers and businesses still suffering in the aftermath of the worst recession since the Great Depression.
Right after the decision was released, the Toronto Stock Exchange's S&P/TSX composite index .GSPTSE see-sawed, rallying and selling off.
"The knee-jerk reaction was that the Fed move would be positive for the markets," said Elvis Picardo, analyst and strategist at Global Securities in Vancouver. At the same time, he noted "a lot of this news has been baked in."
"Investors are using this to take some money off the table here after recent gains," he added.
At 3:19 p.m. (1919 GMT), the index was off 2.07 points at 12,679.35. Seven of the TSX index's 10 main groups were down.
The Fed decision helped undercut prices for safe-haven gold, pulling down Toronto-listed miners such Barrick Gold (ABX.TO), which fell 0.7 percent to C$48.83.
In the energy sector, Suncor Energy (SU.TO) dropped 0.4 percent to C$32.93, while Canadian Natural Resources (CNQ.TO) fell 0.8 percent to C$37.57.
Fertilizer companies remained in the spotlight with a crucial ruling from the Canadian government scheduled for later on Wednesday on whether to allow BHP Billiton's $39 billion takeover bid for Potash Corp (POT.TO) to go ahead. Potash shares were down 0.4 percent at C$145.65.
($1=$1.01 Canadian) (Reporting by Jennifer Kwan; editing by Rob Wilson)