4 Min Read
* TSX falls 17.03 points, or 0.14 percent, to 12,140.26 * Five of 10 main sectors decline * TD down 2 percent on concerns about acquisition risk, results * Loblaw shares up 16 percent on REIT venture plans By John Tilak TORONTO, Dec 6 (Reuters) - Canadian stocks fell on Thursday as investor concerns about Toronto-Dominion Bank's latest U.S. acquisition and results offset a 16-percent jump in Loblaw Cos Ltd on the grocer's plan to spin off its property holdings. The market was also hurt by bleak comments from the European Central Bank about the outlook for the region, as well as renewed distress about the still-unresolved U.S. fiscal crisis. Toronto-Dominion said it is buying the owner of Epoch Investment Partners for $668 million in cash to expand its U.S. asset management business, while it reported a flat quarterly profit. The country's second-biggest bank was down 2 percent at C$80.89, playing the biggest role of any single stock in leading the market lower. Its shares fell on worries about higher expenses and loan loss provisions, as well as added caution attached to its bid for Epoch. "TD has been a laggard of all the banks this year. People were expecting more. There is nothing to write home about the results," said Irwin Michael, portfolio manager at ABC Funds. Shares in Canadian Imperial Bank of Commerce and National Bank of Canada also slipped after they reported earnings on Thursday. The financial sector, the index's biggest, dropped 0.8 percent. The energy sector was down 0.4 percent, hurt by falling oil prices. Brent January crude fell 2 percent to $106.72. Suncor Energy Inc gave back 0.89 percent to C$32.38, Cenovus Energy Inc lost 1 percent to trade at C$33.11, and Encana Corp was down 1.2 percent at C$21.27. At midafternoon, Toronto Stock Exchange's S&P/TSX composite index was down 17.03 points, or 0.14 percent, at 12,140.26. Five of the 10 main sectors on the index were trading lower. The European Central Bank held interest rates steady on Thursday but President Mario Draghi revealed officials pondered a cut and predicted the euro zone economy would shrink again in 2013. "The fact that they are considering an interest rate cut tells us the economy appears to be in recession. They're going to have to keep on pumping the system with more supply of funds until confidence is restored," Michael said. The Canadian market's weakness was tempered by Loblaw, the country's largest grocer, which said it would create one of Canada's largest real estate investment trusts to hold a significant part of its property assets and sell units through an initial public offering. The stock rose to C$38.91, having hit a 52-week high of C$42.05 earlier in the session. Loblaw parent George Weston Ltd gained 7.8 percent to C$68.35. The consumer staples sector advanced 1.6 percent. "The market is probably right here about being enthusiastic," said John Ing, president of Maison Placements Canada. "It is a smart deal for them. This is a good way of utilizing an underutilized asset," he said of Loblaw's plan to unlock the value of the prime real estate it owns across the country. Shares of Canadian Tire Corp, another owner of prime retail real estate, were up 2.8 percent at C$67.67, while coffee chain Tim Hortons Inc rose 2 percent to C$46.34. The materials sector, which includes mining stocks, also provided some support, rising 0.2 percent. Teck Resources Ltd was up 2.3 percent at C$35.