June 22, 2011 / 9:12 PM / 6 years ago

CANADA STOCKS-TSX dips as Fed undermines resource rally

   * TSX ends down 2.76 points, or 0.02 percent, 13,060.56
 * Six of the 10 main groups finish higher
 * Fed lowers U.S. GDP forecast, gives no hints on stimulus  (Updates to close, adds details, comments)
 By John McCrank
 TORONTO, June 22 (Reuters) - Toronto’s main stock index gave up early gains to end marginally lower on Wednesday, after the U.S. Federal Reserve lowered its forecast for U.S. economic growth, which outweighed a rise by gold and energy issues on firmer commodity prices.
 The index had been up nearly 100 points, but headed lower along with U.S. markets after the Fed cut its forecasts without signaling any new stimulus measures. [ID:nN1E75K22F] The United States is by far Canada’s biggest trading partner.
 “The recovery continues, slower than anticipated, and you have the numbers that sometimes cause you a little bit of concern,” said Fred Ketchen, director of equity trading at ScotiaMcLeod.
 The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE ended down 2.76 points, or 0.02 percent, at 13,060.56. Six of the index’s main groups were higher, though only slightly so.
 The decline came after Tuesday’s 1.6 percent jump, its biggest one-day rise in three months.
 Of the gainers, the index’s hefty materials group ended up 0.37 percent, while its gold-mining subgroup rose 1.43 percent on the back of the stronger bullion prices. [GOL/]
 Goldcorp (G.TO) was the most influential gainer of the day, up 0.97 percent at C$48.14, while Barrick Gold (ABX.TO) rose 1.42 percent to C$43.57. Eldorado Gold (ELD.TO) was up 5.4 percent at C$14.43.
 Gold prices rallied for a third consecutive session, though eased late in the day on the back of European sovereign debt fears. [ID:nN1E75K22F]
 “The Greek situation still has not been solved and will keep on coming up very frequently,” said Sal Masionis, a stockbroker at Brant Securities.
 Gold miners also got a boost from the positive market reaction to Iamgold’s (IMG.TO) dividend increase late on Tuesday, said Gavin Graham, president of Graham Investment Strategy. [ID:nASA02CL6]
 “That’s just the latest in a string of profitable gold companies producing mines, actually paying some of that out to their shareholders,” he said.
 The energy group was up 0.12 percent, supported by firmer oil prices, but shed much of its earlier gains after the Fed comments. [O/R].
 Suncor Energy (SU.TO) rose 0.29 percent to C$37.53, while Athabasca Oil Sands (ATH.TO) was up 3.53 percent at C$15.53 (CNQ.TO).
 U.S. crude ended up more than $1 at $95.41 a barrel after a government report showed U.S. stockpiles fell more than expected. [ID:nWEN4604]
 In company news, the London Stock Exchange (LSE.L) sweetened its friendly bid for the operator of the Toronto Stock Exchange to $4.1 billion on Wednesday, topping a hostile offer from a Canadian consortium. TMX shares ended up 1.03 percent at C$44.25. [ID:nN1E75L17E]
 Shares of Bombardier sagged 4.84 percent to C$6.69 after one of the main customers for its new CSeries jet, Republic Airways Holdings RJET.O, placed a big order with rival Airbus EAD.PA. [ID:nN1E75L15Z]
 Shares of beleaguered Chinese forestry company Sino-Forest TRE.TO surged nearly 50 percent to C$3.00 as speculative investors jumped back into the stock after a sharp selloff earlier in the week. [ID:nN1E75L0O7]
 ($1=$0.97 Canadian)  (Additional reporting by Solarina Ho and Trish Nixon; editing by Rob Wilson)                                        

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