CANADA STOCKS-TSX drops broadly on Europe fears

Fri May 7, 2010 5:29pm EDT
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   * TSX falls 150 points, or 1.27 pct, to 11,692.43.
 * Investors fearful after Thursday's plunge
 * Euro zone contagion fears still weigh
 * Index falls for fifth straight day, down 4.2 pct on week
 (Adds details)  
 By Cameron French
 TORONTO, May 7 (Reuters) - Canadian stocks fell hard on
Friday as investors, fearing a growing Greek debt crisis and
shaken by Thursday's stock plunge, sold shares across all
industry groups and made the Toronto market's main TSX index
negative on the year.
 With mystery still surrounding the reasons for Thursday's
3.8 percent intraday drop, market players rushed to lighten
equity holdings.
 "We're still in the aftershocks of yesterday's spectacular
plunge," said Rick Hutcheon, president and chief operating
officer at RKH Investments.
 "Yesterday would shake people's confidence. ... Greece and
the whole European mess doesn't seem to be resolved. There's a
lot of uncertainty and managers' normal reaction to uncertainty
is to sell, take money off the table."
 Resource stocks led the way as oil prices extended a
week-long slide on concerns that Greece's debt woes would
infect other euro zone countries and jeopardize global economic
 The energy sector dropped 1.2 percent, pulled down by
Suncor Energy SU.TO, which dropped 1.4 percent to C$31.92,
and EnCana Corp ECA.TO, which retreated 1.1 percent to
 Mining stocks fell 1.9 percent despite a late rally in
copper prices and strong gold prices, underscoring investor
uneasiness with equities.
 Barrick Gold ABX.TO eased 3.1 percent to C$44.70, pulling
back from a five-month high, while Iamgold IMG.TO fell 2
percent to C$18.47 even after it said its quarterly profit rose
12 percent on higher gold prices. [ID:nSGE6460IR].
 Ventana Gold VEN.TO, however, jumped 7.2 percent to
C$10.80 after it said it had settled an ownership dispute at
its La Bodega gold deposit in Colombia.
 The Toronto Stock Exchange's S&P/TSX composite index
.GSPTSE fell 150.00 points, or 1.27 percent, to 11,692.43.
 For the week, the index dropped 4.2 percent, losing ground
in each session and falling below its Dec. 31, 2009, level for
the first time since March.
 Euro zone contagion fears more than offset a report that
showed a record number of Canadians found employment in April,
data that was expected to put more pressure on the Bank of
Canada to raise interest rates in June, ahead of other major
industrialized countries. [ID:nN0793308]
 The Toronto market's sharp intraday drop on Thursday
prompted regulators to cancel or re-price about 220 trades that
took place at the bottom off the plunge.
 Despite losses, one strategist said the market has held up
fairly well given recent weakness in resource prices and the
European debt worries.
 "Investors tend to forget that markets can be very volatile
at times, and corrections like these are absolutely necessary
to maintain the overall health of the market," said Elvis
Picardo of Global Securities in Vancouver.
 Shares of Internet casino and gaming software company
CryptoLogic Ltd CRY.TO fell 10 percent to C$2.97 after it
posted a bigger quarterly loss, hurt by subdued wagering
 Stock in DragonWave Inc DWI.TO, a maker of radio
transmitters used in cellular networks, plunged 24 percent to
C$6.27 a day after the company reported lower-than-expected
quarterly results on higher costs.
  ($1=$1.04 Canadian)
 (Reporting by Cameron French; editing by Peter Galloway)