CANADA STOCKS-Jitters take TSX down for 7th day to January low

Wed Jun 8, 2011 5:06pm EDT
 
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 * TSX ends down 99.13 points at 13,183.79
 * Touches weakest level since Jan. 10
 * Closes below 200-day moving average
 * All 10 sectors weaker
 (Adds details, technical commentary)
 By Claire Sibonney
 TORONTO, June 8 (Reuters) - Toronto's main stock index
marked its seventh straight loss on Wednesday, falling to its
lowest level since early January as fears over the global
economy intensified and metal prices weakened.
 The index's materials group dropped 1.9 percent as copper
and gold prices eased after a speech by U.S. Federal Reserve
Chairman Ben Bernanke on Tuesday depressed market sentiment.
[GOL/] [MET/L]  While Bernanke gave a bleak assessment of the
U.S. economy, he offered no hints of further U.S. monetary
easing.
 Mining shares had some of the biggest drops on the index
with Barrick Gold Corp (ABX.TO: Quote) sinking 2 percent to C$43.36,
Goldcorp Inc (G.TO: Quote) shedding 1.7 percent to C$46.02, and Teck
Resources (TCKb.TO: Quote) falling 1.3 percent to C$46.63.
 "The only good thing probably is that the volume is down
and we are sort of starting the summer doldrums, but we'll see
how that plays out. Right now it's discouraging," said John
Kinsey, portfolio manager at Caldwell Securities.
 "Like the golds for example, the price of the commodity is
near its all-time high ... and yet all the stocks are just
getting whacked here today ... and to a certain extent, the
energy stocks have followed that pattern as well," he added,
noting oil was back over $100 a barrel on Wednesday.
 The energy sector dipped 0.4 percent even though oil prices
rose after OPEC ministers meeting in Vienna failed to agree on
a supply increase, though some oil and gas companies clung to
gains. [O/R]
 Canadian Natural Resources (CNQ.TO: Quote) gained 1.2 percent to
C$40.25 and Talisman Energy TLM.TO edged up 0.4 percent to
C$19.55.
  Bernanke's speech was the latest discouraging signal in a
steady stream of bad news that has included fresh worries about
European sovereign debt and the Arab Spring as well as concerns
about cooling Chinese growth, Kinsey said.
 The Toronto Stock Exchange's S&P/TSX composite index
.GSPTSE closed down 99.13 points, or 0.75 percent, at
13,183.79. All 10 main sectors were lower, including
financials, off 0.1 percent. Earlier, the index fell as low as
13,161.36, its weakest level since Jan. 10. The TSX is down
almost 2 percent for the year.
 "It's kind of grinding everybody a bit here, sort of like
Chinese water torture, every day it's just drip, drip, drip,"
Kinsey said.
  The index closed below its 200-day moving average for the
first time since last August -- a bearish signal for many
investors.
 Ron Meisels, technical analyst and president of Phases &
Cycles in Montreal, said, however that it's too soon to call a
downtrend for the TSX, noting the closely watched moving
average is still higher than it was roughly 200 days ago.
 "The message is give it another chance, give it leeway,
don't panic when the market goes just below it," he said.
 "It's a place where a lot of people will panic and they get
panicked out of good stocks ...  our attitude right now is that
the TSX is actually tremendously oversold."
 Shares of Sino-Forest TRE.TO, which owns tree plantations
in China, jumped 23 percent to C$4.92, lifted by speculative
buying and short-covering in the wake of a short-seller's
report that crushed the company's stock last week.
[ID:nN08210464]/
 A heavy decliner was Research In Motion RIM.TO, which
fell 2.7 percent to C$35.93 after analyst downgrades.
[ID:nL3E7H81MN]
 ($1=$0.98 Canadian)
 (Reporting by Claire Sibonney; editing by Peter Galloway)