CANADA STOCKS-TSX falls on weak energy shares, banks

Tue Jun 8, 2010 10:29am EDT
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* TSX down 38.44 points at 11,466.30

* Energy, banks drag index lower

By Claire Sibonney

TORONTO, June 8 (Reuters) - Toronto's main stock index fell on Tuesday after see-saw start as financial and energy shares weakened off.

Heavyweight decliners included Royal Bank of Canada (RY.TO: Quote), down 0.9 percent at C$52.02 and Suncor Energy (SU.TO: Quote), slipping 0.6 percent to C$31.60.

Market watchers have been closely eyeing critical technical levels for the Standard & Poor's 500 Index .SPX, which if crossed could spark further equity spelling and spill over into Canadian stocks.

"The S&P 500 is approaching a huge technical level around 1,040 so that will hinge on whether the market can find support approaching the trough seen in February and May," said Fergal Smith, managing market strategist at Action Economics.

The S&P 500 eased 1 point, or 0.10 percent, to 1,049.47.

Smith also pointed to the rise in euro zone government bond yields over benchmark German debt as a gauge of risk aversion. Rising spreads indicate weaker investor confidence.   Continued...