CANADA STOCKS-TSX retreats along with commodity prices

Tue Jan 25, 2011 11:02am EST
 
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* TSX down 61.89 points at 13,285.69

* Eight of 10 sectors lower (Updates with details, commentary)

By Claire Sibonney

TORONTO, Jan 25 (Reuters) - Toronto's main stock index retreated on Tuesday after Monday's broad rally, as a shock contraction in the struggling UK economy fanned fears about the pace of the global recovery and commodity prices fell.

Prices for oil and metals such as copper were hit by a double-whammy of the weak GDP data from Britain and by worries that monetary tightening in Asia could curb the appetite for commodities in those growing economies [ID:nL3E7CP04X] [ID:nLDE70O0IS].

As well, gold slid to near a three-month low as safe-haven demand evaporated and investors booked further profits from the 2010 rally. [O/R] [MET/L] [GOL/]

Resource issues weighed most heavily on the TSX index as energy shares lost 1.1 percent and the materials sector was 0.9 percent lower.

Among the biggest decliners were Canadian Natural Resources (CNQ.TO: Quote), off 1.5 percent at C$41.51, and Teck Resources TCKb.TO, which skidded 1.8 percent to C$58.72.

"What we're seeing is a bit of a selloff in commodities and I think it might be a bit of an extension of what we saw last week when commodities sold off following very strong economic results out of China," said Philip Petursson, director of the portfolio advisory group at MFC Global Investment Management.   Continued...