CANADA STOCKS-TSX tumbles on Italy debt fears; gold miners rally

Wed Nov 9, 2011 1:00pm EST
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 * TSX down 151.34 pts, or 1.2 percent, to 12,337.51
 * Italian bond yields hit 7 pct, sparking fears
 * Energy, financial shares lead market lower
 * Gold prices help offset losses
 (Adds further analyst comment, details)
 By Jon Cook
 TORONTO, Nov 9 (Reuters) - Canadian stocks fell more that 1
percent on Wednesday, with resource companies reeling, as a
spike in Italian bond yields sparked fears Europe's debt crisis
has entered a dangerous new phase that will threaten global
 Global stocks and commodity prices took a pounding after
Italy's 10-year bond yields rose above the precarious 7-percent
level, which had previously caused other European Union
countries such as Greece, Ireland and Portugal to seek
bailouts. [MKTS/GLOB]
 "It's the market realizing that today is a day it has to be
more concerned with risk instead of growth," said Michael
Simpson, senior portfolio manager at Sentry Select Capital
Corp. "The companies that have a higher exposure to an
expanding economy are suffering."
 At midday, the Toronto Stock Exchange's S&P/TSX composite
index .GSPTSE was down 151.34 points, or 1.2 percent, to
12,337.51 after hitting a session low of 12,270.93, it's lowest
point in nearly a week.
 Energy stocks led the Canadian market lower, falling nearly
2 percent. The biggest drag was Suncor Energy Inc (SU.TO: Quote),
which plunged 3.2 percent to C$32.23.
 Financial stocks were the next biggest weight, dropping 1.6
percent, led down by Royal Bank of Canada (RY.TO: Quote), which fell 2
percent to C$45.48.
 With a debt burden of about 1.9 trillion euros, Italy is
considered too difficult to bail out, and a default would
probably send Europe into recession and drag on global growth.
 "It's fear of contagion," said John Kinsey, portfolio
manager at Caldwell Securities Ltd. "They're the third-largest
economy in Europe and this is really where the fear factor
comes in. It's not just Greece with 10 million people."
 "If their (EU) economy goes down that affects China because
they were a big importer from China and people are worried the
Chinese economy will slow."
 The broader market uncertainty over Europe's debt crisis
helped boost gold prices above $1,790 an ounce, which led to a
1 percent gain for Canadian gold mining stocks. [GOL/]
 Barrick Gold (ABX.TO: Quote) led the sector's gains, rising nearly
2 percent to C$53.51. Goldcorp (G.TO: Quote) was up 2.1 percent to
 In company news, First Quantum Minerals (FM.TO: Quote) shares fell
more than 10 percent to C$20.60 a day after the Vancouver-based
miner lowered its full-year production outlook to reflect a dip
in quarterly production. [ID:nL4E7M83WT]
 Shares of patent licensing firm Wi-Lan Inc WIN.TO fell
more than 6 percent after it cut its full-year outlook as sales
to its major dish television customers slowed. [ID:nL4E7M92BY]
 WestJet Airlines (WJA.TO: Quote) shares fell 2.5 percent to
C$12.81, after Canada's No. 2 carrier reported lower
third-quarter profit on higher maintenance and jet fuel costs.
 (Editing by Jeffrey Hodgson)