CANADA STOCKS-TSX dives more than 2 pct as commodities fall

Thu Nov 17, 2011 5:20pm EST
 
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   * TSX down 258.93 pts, or 2.13 pct, at 11,915.43
 * Index hits lowest point since Oct. 21
 * Falling gold, copper prices hit miners
 (Adds details, analyst's comments)
 By Jon Cook
 TORONTO, Nov 17 (Reuters) - Toronto's main stock index
tumbled more than 2 percent on Thursday, nearing a one-month
low, as rising yields on European bond sales sparked a
widespread selloff in commodities that sent material and energy
shares lower.
 Falling gold, copper and silver prices played havoc with
TSX mining stocks, which plunged more than 4 percent. Gold
miners accounted for most of that as bullion's worst one-day
drop in nearly two months caused the gold-mining subindex to
fall 3.5 percent. [GOL/]
 Barrick Gold (ABX.TO: Quote), down 3.8 percent at C$50.66, and
Goldcorp (G.TO: Quote), down 2.1 percent at C$52.38, led the slide.
 Copper fell 3 percent to its worst one-day decline in three
weeks, while silver slid nearly 7 percent. [MET/L]
 The Toronto Stock Exchange's S&P/TSX composite index
.GSPTSE ended down 258.93 points, or 2.13 percent, at
11,915.43, its lowest point since Oct. 21.
 The TSX's retreat mirrored the downturn on global markets
after a rise in Spain's borrowing costs to almost 7 percent at
an auction kept European debt contagion fears alive.
[MKTS/GLOB]
 "The sentiment on the economic outlook for the euro zone
appears to be becoming ever more grim," said Pat Mohr, a
commodity market specialist at Scotia Capital.
 It was the biggest selloff for Canadian commodities since
early October, said Mohr, adding that the economic turmoil in
Europe has investors selling equities and commodities to raise
cash.
 Energy issues finished down 2.4 percent as U.S. crude fell
by more than $3 a barrel, a day after it topped $100. [O/R]
Canadian Natural Resources (CNQ.TO: Quote) led that sector's decline,
falling 3.9 percent to C$37.19.
 Solid U.S. economic data helped cushion 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 has been gaining
traction. [ID:nN1E7AG0BT]
 "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.
 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 on Thursday, with the index's financial sector
falling nearly 2 percent.
 Royal Bank of Canada (RY.TO: Quote) was down 2.6 percent at
C$43.95, and Bank of Nova Scotia (BNS.TO: Quote) slid 2.8 percent to
C$49.32.
 Healthcare was the only TSX sector not in the red, rising
1.4 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$54.40. [ID:nL3E7MH1W3]
 In other company news, Magna International Inc (MG.TO: Quote)
shares rose 0.7 percent to C$35.35 after it said it will
acquire German parts maker BDW Technologies' aluminum die
casting operations in Europe. [ID:N1E7AG0KF]
 ($1=$1.03 Canadian)
 (Editing by Rob Wilson and Peter Galloway)