CANADA STOCKS-TSX down more than 1 pct on euro zone debt fears

Fri May 14, 2010 10:39am EDT
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 * TSX down 133.96 points, or 1.1 percent, at 11,982.63
 * Nine of TSX index groups lower
 * Golds fight to limit index's fall
 (Adds details, quote)
 By Jennifer Kwan
 TORONTO, May 14 (Reuters) - Toronto's main stock index
followed global markets lower on Friday on speculation that
heavy euro zone debt loads could dampen a fragile global
economic recovery.
 Oil prices fell toward $73 a barrel as investors feared
euro zone debt concerns could hamper future energy demand
growth, pushing down energy shares by 1.7 percent. [O/R]
 Suncor Energy (SU.TO: Quote) fell 1.8 percent to C$32.25, while
EnCana Corp (ECA.TO: Quote) dropped 1.8 percent to C$32.78.
 European authorities announced a massive debt safety net
for Greece, Spain and Portugal this week, but investors
remained skeptical whether those countries can take the pain of
overhauling their poor public finances. [MKTS/GLOB]
 "Nobody believes that the bailout in the euro zone is going
to work out. Everybody is still negative on the euro," said Joe
Ismail, technical analyst at Maison Placements Canada.
 At 10:08 a.m. (1408 GMT), the Toronto Stock Exchange's
S&P/TSX composite index .GSPTSE was 133.96 points, or 1.1
percent, lower at 11,982.63. Nine of its 10 main sectors were
 Toronto's financials sector, down 1.5 percent, also got
caught up in the mood, with Royal Bank of Canada (RY.TO: Quote) down
1.6 percent at C$59.68.
 Separately, ratings agency Moody's cut the long-term debt
rating on the bank's U.S. unit. [ID:nN14155340]
 As well, the sector was weighed down a day after the U.S.
Senate voted to limit fees charged on credit and debit card
transactions. [ID:nN14139295]
 Fighting to limit the resource-laden index's drop were gold
mining shares, with the subsector up 1.3 percent.
 Gold hit record highs near $1,250 an ounce in Europe on
Friday as investors flocked to safety on fears about sovereign
risk in the euro zone and instability in the foreign exchange
markets. [GOL/]
 Barrick Gold (ABX.TO: Quote), the world's No. 1 gold producer,
rose 1.7 percent to C$46.55 and Goldcorp (G.TO: Quote) climbed 0.7
percent to C$46.80. Agnico-Eagle Mines (AEM.TO: Quote) was up 2
percent at C$65.59.
 Ismail said he's watching to see if the main index drops
below its 200-day moving average around 11,500, a key technical
support level.
 "As long as we can hold above that we're on safe ground. If
we begin to break right through and we remain there then we are
starting a different pattern of trends," he said.
 In earnings, toymaker Mega Brands Inc MB.TO returned to a
first-quarter profit on Friday as the Canadian toymaker
benefited from a gain related to its recent recapitalization
plan. Its shares were up 5.9 percent at 54 Canadian cents.
 ($1=$1.03 Canadian)
 (Reporting by Jennifer Kwan; Editing by Jeffrey Hodgson)