CANADA STOCKS-TSX little changed as gold gains offset EU fears

Mon Nov 7, 2011 12:58pm EST
 
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 * TSX up 14.8 points, or 0.12 pct at 12,423.05
 * Gold stocks lift index, offset weaker financials
 * Italy turmoil stokes new EU fears
 By Jon Cook
 TORONTO, Nov 7 (Reuters) - Toronto's main stock index was
virtually flat in a volatile session on Monday, as gains from
gold miners on higher bullion prices offset broader investor
concern about political turmoil in Europe.
 Speculation that Italian Prime Minister Silvio Berlusconi's
government was on the verge of collapse sparked fears the euro
zone debt crisis could overwhelm the region's third largest
economy. [MKTS/GLOB]
 The Toronto Stock Exchange's subindex of gold producers
.SPTTGD, which often climbs on investor uncertainty, hit its
highest point since Sept. 22.
 Goldcorp (G.TO: Quote), up 3.4 percent to C$54.21, and Barrick
Gold (ABX.TO: Quote), up 1.9 percent to C$53.23, led the sector.
 "Given the weight of the TSX gold sector, which is roughly
13 percent, it's going to have a positive net effect for the
broader index," said Sid Mokhtari, market technician and
director of institutional equity research at CIBC World
Markets.
 The move in gold miners helped lift the heavily weighted
materials sector, which rose nearly 1 percent.
 At midday, the Toronto Stock Exchange's S&P/TSX composite
index .GSPTSE was up slightly, rising 14.8 points, or 0.12
percent, to 12,423.05.
 After Greek political unrest held the market's attention
last week, investor focus switched to Italy, where Berlusconi
faced a rebellion in his party. A recovery in Italian stocks
and a pullback in government bond yields reversed when he
denied reports that he would resign. [ID:nL6E7M7283]
 The turmoil in Italy, one of Europe's biggest economies,
extended the European debt malaise that has embraced the region
and global markets for weeks.
 Eight of the TSX's main sectors were down, with financial
stocks a significant drag.
 While Canadian lenders have little direct exposure to
European debt, there is a risk a widening crisis could hit the
global economy and their results.
 Manulife Financial Corp (MFC.TO: Quote) led declines, falling 2.5
percent to C$12.47. Bank of Nova Scotia (BNS.TO: Quote) was down 0.1
percent to C$52.18.
 (Editing by Jeffrey Hodgson)