CANADA STOCKS-TSX up as banks rebound, but jobs data weighs

Fri Aug 7, 2009 11:00am EDT
 
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* TSX up 0.6 percent at 10,855.03

* Financials lead, but insurers still weak

* Canadian jobs losses worse than expected, U.S. better (Adds details)

By Ka Yan Ng

TORONTO, Aug 7 (Reuters) - Toronto's main stock index pared early gains at midmorning on Friday as investors weighed contrasting jobs data from Canada and the United States and reconsidered the pace of the economic recovery.

The TSX jumped more than 1 percent right at the opening bell, spurred by the clearest evidence yet that the U.S. economy was turning around as data showed far fewer jobs were lost in July than expected. [ID:nN07385157]

But the index quickly trimmed those gains as investors had second thoughts about the domestic economy, which showed job losses were nearly triple expectations. [ID:nN07253705]

Still, nine of 10 sectors were higher, led by a rebound in the financials group, which rose 0.74 percent.

The hefty financials group, which makes up about one-third of the TSX's weighting, had tumbled 5.6 percent in the previous session on the back of insurance company news -- a dividend cut by Manulife Financial (MFC.TO: Quote) and a warning from Sun Life Financial (SLF.TO: Quote).   Continued...