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TORONTO (Reuters) - The Toronto Stock Exchange's main index retreated on Friday as softer commodity prices pulled down energy and materials issues, while telecoms giant BCE (BCE.TO) provided an upward push.
With U.S. markets closed, many Toronto traders started their weekend early, leading to thin volumes that accentuated the market's volatility, analysts said.
"America is closed. Whenever that happens, nothing much is going to happen in Canada," said Douglas Davis, president at Davis-Rea in Toronto.
The S&P/TSX composite index .GSPTSE fell 133.18 points, or 0.94 percent, to close at 14,010.39.
The decline would have been steeper if not for the sharp rise in shares of BCE. BCE climbed 12.8 percent after the company said its C$34.8 billion takeover by a group led by the Ontario Teachers' Pension Plan would go ahead at the agreed C$42.75-per-share purchase price.
The stock has endured big swings over the past year as investors wondered if the leveraged buyout would go through and at what price.
"I think this adds another notch in it that it's probably going to be done at C$42.75," said Sal Masionis, a stockbroker at Brant Securities. "If it wasn't for BCE, (the index) would be down quite a bit more."
BCE rose C$4.49 to C$39.64, leading the TSX telecoms subgroup up 5.36 percent.
But eight of the 10 TSX groups fell during the session, including the materials and energy sectors, which account for about half of the index's weighting.
Energy stocks fell 1.77 percent as oil prices fell more than a dollar per barrel. Materials issues slid 1.51 percent, as prices for both base and precious metals eased.
Among energy players, EnCana Corp (ECA.TO) fell C$3.42, or 3.7 percent, to C$88.88, while Talisman Energy TLM.TO dropped 54 Canadian cents, or 2.6 percent, to C$20.53.
Potash Corp (POT.TO) weighed on materials, falling C$6.68, or 3 percent, to C$213.32.
For the week, which was shortened due to the Canada Day holiday on Tuesday, the TSX index fell 2.4 percent.
Worries about the faltering U.S. economy and soaring oil prices have weighed on the market, particularly financial and consumer shares, and analysts see no reason to expect anything different.
"You have tremendous cross currents," said Masionis, pointing to signs of rising interest rates in Europe.
The financials subgroup eased 0.92 percent during the session, pulled down by Bank of Nova Scotia (BNS.TO), which slid 77 Canadian cents, or 1.6 percent, to C$46.44.
Toronto-Dominion Bank (TD.TO) slipped 25 Canadian cents, or 0.4 percent, to C$63.09, after the bank said it will take a one-time pretax charge of C$96 million because of incorrectly priced credit derivatives in the London office of its TD Securities unit.
A total of 162.6 million shares changed hands on the day, valued at C$3.4 billion, about one-third of which was due to trading in BCE shares. Declining issues outnumbered advancers 731 to 658.
The blue-chip S&P/TSX 60 index eased 10.16 points, or 1.2 percent, to 835.94.
Reporting by Cameron French; Editing by Peter Galloway