June 8, 2009 / 8:47 PM / 8 years ago

CANADA STOCKS-TSX slips as energy selloff outweighs bank rally

3 Min Read

* TSX falls 20.17 points to 10,549.12

* First lower close since Wednesday

* Bank shares help cushion fall (Adds details, comments and official numbers)

By Frank Pingue

TORONTO, June 8 (Reuters) - Toronto's main stock index was knocked lower for the first time in three sessions on Monday as a late charge by bank shares was not enough to offset the drag that lower oil prices had on weighty energy issues.

Energy players led the retreat as oil prices eased lower toward $68 a barrel, given renewed strength in the greenback. [ID:nSP162458]

A stronger U.S. dollar has the tendency to weaken commodity markets as it reduces the purchasing power of buyers holding other currencies.

Shares of Suncor Energy (SU.TO) ended down 1.85 percent at C$37.76, while Canadian Natural Resources (CNQ.TO) dropped 1.3 percent to C$63.88.

The energy group, which suffered the steepest decline among the TSX's 10 main sectors, ended the session down 1 percent, just days after it climbed to its highest level since Oct. 3.

"We were led lower by the energy group as we saw some sort of profit-taking there after it hit an eight month high last week," said Elvis Picardo, analyst and strategist at Global Securities in Vancouver.

"Given that we had a really strong rally on the TSX since the March lows, this bout of volatility is to be expected," Picardo said.

The S&P/TSX composite index .GSPTSE ended down 20.17 points, or 0.19 percent, at 10,549.12 after spending the entire session in negative territory.

The TSX fell 1.8 percent right after the open before it stormed back and came within 10 points of moving into positive territory with about 25 minutes left in the session.

The slide was limited by stronger bank issues, which Picardo said rallied on growing optimism about the outlook for the Canadian economy.

Royal Bank of Canada (RY.TO) ended up 1.3 percent at C$46.09, while Toronto-Dominion Bank (TD.TO) followed with a gain of 1.2 percent to C$58.83.

The financials index, which accounts for about 33 percent of the broader index, ended the session 0.52 percent higher. At one point, it had fallen as much as 1.3 percent.

The materials sector, home to major mining companies, fell 0.33 percent as gold prices fell.

$1=$1.12 Canadian Editing by Rob Wilson

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