June 27, 2011 / 2:58 PM / in 6 years

CANADA STOCKS-TSX flat as stronger banks offset energy

 * TSX up 5.57 points at 12,914.46
 * Financials lead gains, but energy shares weigh  (Updates with details, commentary)
 By Claire Sibonney
 TORONTO, June 27 (Reuters) - Toronto’s main stock index was little changed on Monday morning as stronger financials offset weakness in commodities ahead of a Greek austerity vote later in the week that will be critical to securing a new bailout.
 Weighty financial shares were up 0.2 percent. Royal Bank of Canada (RY.TO) edged up 0.3 percent to C$54.08, while Manulife Financial (MFC.TO) added 1 percent to C$16.14.
 “Maybe some short-covering, but there’s no real force buying going through right now. I think people are more squaring off positions or reducing positions,” said Francis Campeau, a broker at MF Global Canada in Montreal.
 On the other side of the equation, the Thomson Reuters-Jefferies CRB index .CRB, a global commodities benchmark, fell 0.5 percent, dragging resource shares down.
 Brent and U.S. crude futures slipped slightly in choppy action, reacting to lower than expected U.S. personal income and spending data and on uncertainty over Greece’s vote on Wednesday. [O/R]
 Greek lawmakers will begin debating a 28 billion euro ($40 billion) package of measures to increase taxes and cut spending that is critical to winning a new round of international funding aimed at easing its debt crisis. [ID:nLDE75P0BM]
 At 10:36 a.m. (1436 GMT), the Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE was up 5.57 points, or 0.04 percent, at 12,914.46.
 The energy sector fell 0.3 percent, with Suncor Energy (SU.TO) the most influential decliner on the index, sliding 0.7 percent to C$36.74.
 Niko Resources NKO.TO dropped 3.7 percent to C$60.50 after the oil and gas producer was fined C$9.5 million and given three years’ probation after pleading guilty to charges that it bribed a Bangladeshi official. [nN1E75N02B]
 Potash Corp (POT.TO) was the strongest advancer, climbing 1.2 percent to C$52.53. Gold miners also reversed earlier losses, rising 0.3 percent, despite easing bullion prices. [GOL/]
 Campeau said he expects sideways trading until Greece’s austerity vote on Wednesday.
 “There’s the vote and the question of how they’re going to package all those Greek bonds, and until these issues are cleared up or settled, the market risk will remain to the downside,” he said.
 “Buyers will step in only when they can add a bit more visibility out of Europe.”
 Campeau noted that the Greek vote on Wednesday also marks the last day of the first half of the year.
 “We might see some positive rebalancing where people sell some bonds to buy stocks.”
  (Reporting by Claire Sibonney)                                        

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