CANADA STOCKS-TSX dips as China worries hit oils, materials

Mon Mar 15, 2010 5:32pm EDT
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 * TSX ends down 5.02 points, or 0.04 percent, at 12,008.80
 * Energy sector leads TSX lower as oil below $80
 * China policy tightening, U.S. Fed in focus
 By John McCrank
 TORONTO, March 15 (Reuters) - Toronto's main stock index
ended slightly lower on Monday as its energy and materials
sectors fell on worries that credit tightening in China could
sap demand for Canada's resources, outweighing a late-session
rally in financial issues.
 Some of the bigger decliners of the day were Canadian
Natural Resources (CNQ.TO: Quote), down 2 percent at C$73.22, Suncor
Energy (SU.TO: Quote), down 2.5 percent at C$31.04, and Cenovus Energy
CVE.N, which fell 1.8 percent to C$26.00.
 Overall, the index's heavily weighted oil and gas group
dropped 1.3 percent as the price of oil fell nearly 2 percent
to below $80 a barrel. [ID:nSGE62E08S]
 China's central bank is expected to tighten its monetary
policy as early as this week to temper its red-hot economy,
spurring concern about the effect that could have on the global
 Profit-taking also played a role in the slide in the energy
sector, said Bruce Latimer, a trader at Dundee Securities.
 "(The price of oil) broke down below $80 and that triggered
a little bit of selling," he said.
 The index's materials group, home to miners and fertilizer
companies, dropped 0.4 percent as Potash Corp of Saskatchewan
(POT.TO: Quote) fell 0.4 percent to C$127.51, and Teck Resources
TCKb.TO lost 1.4 percent to C$41.00. [MET/L]
 The Toronto Stock Exchange's S&P/TSX composite index
.GSPTSE closed down 5.02 points, or 0.04 percent, at
12,008.80. The index's close above 12,000 on Friday was its
highest finish in about 18 months.
 Around midday on Monday, the index was down nearly 1
percent, but it bounced back as financials, which had been
pretty flat most of the session, rallied to end up 0.9
 Toronto-Dominion Bank (TD.TO: Quote) rose 1.5 percent to C$73.36,
Bank of Montreal (BMO.TO: Quote) gained 1.1 percent to C$60.40, and
Royal Bank of Canada (RY.TO: Quote) added 0.7 percent to C$58.84.
 Financial issues "have, on a relative strength basis, been
one of the better performers of the last few weeks, so I guess
it's sort of a follow-through there -- in the absence of any
specific news, you stick with what's been doing OK," said Paul
Hand, managing director at RBC Capital Markets.
 He said that low volume in the market as families vacation
during the March school break in some parts of Canada added to
the volatility on the market.
 In company news, drugmaker Patheon Inc PTI.TO posted a
bigger quarterly loss, hurt by lower revenue in its
pharmaceutical development services unit. It said it sees
higher revenue in fiscal 2010. [ID:nSGE62E0PZ]
 Looking ahead, the interest-rate setting committee of the
U.S. Federal Reserve holds a one-day meeting on Tuesday in
which it is widely expected to repeat its promise to keep
borrowing costs exceptionally low for an extended period.
 Japan's central bank also has a policy meeting this week.
 ($1=$1.02 Canadian)
 (Editing by Peter Galloway)