UPDATE 2-Toronto stocks dip as banks hit by U.S. jitters

Mon May 5, 2008 4:42pm EDT
 
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(Updates closing numbers, adds details)

TORONTO May 5 (Reuters) - The Toronto Stock Exchange's main index ended little changed on Monday, pressured by a selloff in banking shares that overshadowed the boost provided by surging commodity prices.

The tumbling banking sector led the downside, caught up by jitters south of the border after a brokerage said Bank of America (BAC.N: Quote) was likely to renegotiate, or possibly walk away from, its deal to buy mortgage lender Countrywide Financial CFC.N.

On Bay Street, Canadian Imperial Bank of Commerce (CM.TO: Quote) was down C$2.37, or 3.1 percent, at C$73.93, while Royal Bank of Canada (RY.TO: Quote) fell C$1.38, or 2.8 percent, to C$48.70. Overall, the sector lost 2.2 percent.

The S&P/TSX composite index .GSPTSE closed down 5.94 points, or 0.04 percent, at 14,274.34.

The energy and materials sectors were the sole sectors to climb higher, helping to prop up the index for much of the day as crude oil prices scaled fresh heights.

The oil and gas group rose 1.4 percent, with Suncor Energy (SU.TO: Quote) up C$2.85, or 2.5 percent, at C$116.50, and Petro-Canada PCA.TO gaining C$1.06, or 2.1 percent, to C$52.47.

Also in resources, Potash Corp of Saskatchewan (POT.TO: Quote) added C$5.55, or 2.9 percent, to C$196.36, while Barrick Gold (ABX.TO: Quote) advanced C$1.10, or 2.9 percent, to C$39.41. The materials sector pushed up 2.4 percent, and its smaller gold producers subindex put on 1.9 percent, helped by rising bullion prices.

Analysts said the Toronto benchmark was hurt by profit-taking on the heels of a strong three-day runup. Also on the downside, the consumer discretionary sector gave up 1.8 percent, while the utilities group was off 1.3 percent.

($1=$1.01 Canadian) (Reporting by Leah Schnurr; Editing by Peter Galloway)