CANADA STOCKS-Slumping energy, gold issues lead TSX lower

Thu Nov 17, 2011 1:35pm EST
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   * TSX down 205.79 pts, or 1.7 pct, at 11,968.57
 * Index hits lowest point since Nov. 1
 * Gold miners fall as bullion hits one-week low
 * Upbeat U.S. data limits losses
 (Adds details, updates prices)
 TORONTO, Nov 17 (Reuters) - Toronto's main stock index
tumbled more than 200 points on Thursday, with mining and
energy stocks tracking gold and oil prices lower, as rising
yields on European bond sales sparked fears of a worsening euro
zone debt crisis.
 The heavily weighted materials sector led the slide,
falling more than 3 percent, mostly due to gold-mining stocks,
which also fell more than 3 percent as bullion prices hit a
one-week low. [GOL/]
 Barrick Gold ABX.TO was down 2.7 percent at C$51.20,
while Goldcorp G.TO skidded nearly 2.2 percent to C$52.34.
 Energy issues were down 1.6 percent after gaining 1 percent
in the previous session. Canadian Natural Resources CNQ.TO
led that sector's decline, falling 2 percent to C$37.88.
 The drop by energy stocks came as U.S. crude fell by more
than $3 a barrel, a day after it topped $100, as worries about
the euro zone crisis deepened. [O/R]
 The Toronto Stock Exchange's S&P/TSX composite index
.GSPTSE was down 205.79 points, or 1.7 percent, at 11,968.57
by early afternoon, its lowest point since Nov. 1.
 The retreat mirrored the broader downturn on global markets
as 10-year Spanish bond yields approached the precarious 7
percent mark, their highest level since 1997, unnerving
investors. A French bond auction also saw high yields.
 Solid U.S. economic data helped limit the losses. New U.S.
claims for jobless benefits hit a seven-month low last week,
while permits for home construction rebounded strongly in
October, bolstering views the economy was gaining traction.
 "If we didn't have that outstanding problem in Europe we'd
actually see the (index rising)," said Robert Kavcic, economist
at BMO Capital Markets.
 Better mid-morning news out of Italy and Greece also helped
calm market sentiment. Italian Prime Minister Mario Monti
pledged additional economic reforms and Greece was to present
creditors with a proposal to halve its privately held debt by
the end of the month, a senior finance ministry official told
Reuters. [ID:nL5E7MH0ZT] [ID:nL5E7MH2OS]
 As Europe's economy suffers beneath its debt burdens,
investors feared it could start to seriously affect the profits
of North American banks.
 A Fitch Ratings report on Wednesday said U.S. banks could
be greatly affected if "contagion continues to spread beyond
the stressed European markets."
 Canadian banks, which have limited exposure to euro zone
debt, were down again on Thursday, as the financials sector
fell 1.4 percent.
 Royal Bank of Canada RY.TO was down 2.3 percent at
C$44.08 and Bank of Nova Scotia BNS.TO slid 1.7 percent to
 Healthcare was the only TSX sector not in the red, rising 1
percent, boosted by SXC Health Solutions Corp's SXC.TO
announcement it will buy privately held smaller rival
HealthTrans LLC for $250 million. SXC's shares rose more than 7
percent to C$54.27. [ID:nL3E7MH1W3]
 In other company news, Magna International Inc MG.TO
shares rose 1 percent to C$35.47 after it said it will acquire
German parts maker BDW Technologies' aluminum die casting
operations in Europe. [ID:N1E7AG0KF]
 ($1=$1.02 Canadian)
 (Editing by Rob Wilson)