CANADA STOCKS-TSX weakens as miners drag, jobs data ignored

Fri Oct 7, 2011 11:53am EDT
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   * TSX down 55.86 points, or 0.47 percent, at 11,724.21
 * Seven of 10 main sectors lower
 * Material sector drags as gold miners, Potash Corp slip
 (Adds detail, analyst comment)
 By Julie Gordon
 TORONTO, Oct 7 (Reuters) - Toronto's main stock index fell
on Friday, largely ignoring unexpectedly strong Canadian and
U.S. jobs data, with the materials sector dragged down by gold
and base metal miners.
 The heavyweight sector, which benefited from a two-day
rally this week, dropped 0.43 percent in early trade as shares
of the world's top gold producer, Barrick Gold ABX.TO,
slipped 1.9 percent to C$48.62 and Goldcorp G.TO fell 2.15
percent to C$48.18.
 The stocks slipped even with gold prices edging up toward
their biggest weekly gain in a month as the U.S. dollar
softened after unemployment data. [GOL/] [FRX/]
 "This spread between gold companies and bullion itself, it
just continues to be as wide as the grand canyon," said Paul
Taylor, chief investment officer at BMO Harris Investment
Management Inc. "There's no sense that this is looking to close
anytime soon."
 Fertilizer producer Potash Corp POT.TO was the biggest
loser on the index, slipping 3.23 percent to C$46.80 as Chicago
wheat futures gave up early gains to slip more than 1 percent.
 At 11:31 a.m. (15:31 GMT), the Toronto Stock Exchange's
S&P/TSX composite index .GSPTSE was down 55.86 points, or
0.47 percent, at 11,724.21.
 Stocks fell even after a report of better-than-expected
jobs growth, which helped slice Canada's unemployment rate to
7.1 percent in September, boosting its currency and virtually
ensuring the central bank won't cut rates any time soon.
 In the United States, the Nasdaq fell over 1 percent as
stocks struggled to make headway following a three-day market
rally, even after a report showed the U.S. economy added more
jobs than expected in September. [.N]
 The dip in Canadian stocks comes after two days of gains,
as commodities rallied and U.S. economic data came in better
than expected.
 "It's been a pretty profitable week and somewhere along the
way we're going to give back a little bit," said Fred Ketchen,
director of equity trading at ScotiaMcLeod. "There's just a
little bit of caution showing here in markets this morning."
 The top gainer on the index at mid-morning was First
Quantum Minerals FM.TO, which rose 2.72 percent to C$17.02
after the base metal miner said it would resume production at
its Ravensthorpe nickel mine in Australia by the end of the
year. [ID:nL3E7L50KN]
 Also gaining were Canadian Oil Sands COS.TO, up 1.84
percent to C$21.03 and Cenovus Energy CVE.TO, up 0.53 percent
to C$33.89 as U.S. crude futures headed for their biggest
weekly gain in seven months, though Canadian Natural Resources
CNQ.TO dropped 1.59 percent to C$30.97, dragging the energy
sector negative.
 Analysts said that overall market conditions, including the
ongoing debt crisis in Greece, would likely keep Canadian
stocks in check over the coming weeks.
 "I don't think the conditions are right to have this market
all of a sudden just continue running higher and higher, day
after day, week after week," said Ketchen.
 ($1=$1.05 Canadian)
 (Editing by Jeffrey Hodgson)