March 26, 2010 / 12:55 AM / 7 years ago

TSX ends flat as Korea news spooks investors

3 Min Read

<p>A Toronto Stock Exchange (TSX) logo is seen in Toronto in this November 9, 2007 file photo.Mark Blinch</p>

TORONTO (Reuters) - The TSX ended little changed on Friday as the sinking of a South Korea naval vessel stoked worries about geopolitical tensions in Asia, offsetting growing confidence over a deal for debt-ridden Greece.

News of the ship sinking with more than 100 people on board stirred fears of the possibility of a military confrontation, even though Seoul said it was not clear if North Korea was involved.

The incident stymied the market just as positive sentiment was building around an agreement that would provide a safety net for Athens as it struggles to cut a giant budget deficit.

Gold stocks like Barrick Gold Corp rose along prices for the safe-haven metal, while financial issues such as Royal Bank of Canada slipped.

"There's always something in the world that is going to spook the markets, no matter if the markets are expecting it or not," said Ian Nakamoto, director of research at MacDougall, MacDougall & MacTier.

The Toronto Stock Exchange's S&P/TSX composite index finished 0.74 of a point, or 0.01 percent, lower to 11,957.37. The index ended the week flat at 0.1 percent higher.

"It just seems to me as if investors are looking for excuses to take some of their profits," said Elvis Picardo, an analyst and strategist at Global Securities in Vancouver.

"The underlying tone is still quite healthy, but given that we've come up quite substantially from last month's lows, I think investors are a little trigger happy," he added.

The heavily weighted financial sector was hit as Royal Bank, the country's biggest lender, retreated 0.9 percent to C$59.82, after hitting its highest point since 2007 earlier in the day at C$60.55.

Bank of Nova Scotia was down 1.5 percent to C$51.05. and Toronto-Dominion Bank lost 0.7 percent to C$76.00.

The powerhouse energy sector was down 0.2 percent, with Suncor Energy Inc, the country's largest oil company, down 0.1 percent to C$30.85, and natural gas major Encana Corp off 0.7 percent to C$30.35.

Oil prices fell below $80 after data showed the U.S. economy grew less than expected last quarter, and the plan to bail out Greece failed to quell concern over fragile economic recovery.

Eight of the 10 sectors were lower, but materials issues rose 1.6 percent, reflecting firmer gold prices and copper at a two-week high.

Barrick, the world's biggest gold producer, gained 2.1 percent to C$38.42, while base metals miner First Quantum Minerals added 1 percent to C$90.72.

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