Toronto stocks set for choppy day, banks in focus

Fri Jun 20, 2008 9:07am EDT
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*TSX set for volatile day

*Worries over banks could be offset by rising oil

TORONTO, June 20 (Reuters) - The Toronto Stock Exchange's main index looked ready for a mixed open on Friday, as worries over the health of financials could be offset by strengthening energy stocks after a bounce in oil prices.

Oil, a key factor for the benchmark's heavyweight energy sector, pushed above $134 a barrel after tumbling nearly $5 on Thursday after China said it would raise fuel prices.

But worries of more fallout from the credit crunch emerged after Citigroup (C.N: Quote) said on Thursday that it could have significant write-downs in the second quarter.

Canadian financials have not seen the same depth of the problems as their U.S. and global counterparts, but Rick Hutcheon, president and chief operating officer at RKH Investments, said the sector could be caught up in the worries on Friday.

"We're just utterly preoccupied by these financial stocks right now, it's front and foremost in everyone's mind right now," said Hutcheon.

The S&P/TSX composite index .GSPTSE starts the day off at 14,790.15, after a steep drop on Thursday amid tumbling oil prices and pressured by inflationary fears.

On the economic front, retail sales for April rose as Canadians returned to stores, Statistics Canada said on Friday. For details, see: [nN22550164].   Continued...