Weaker oils, golds pull TSX to 1-week low

Tue Mar 8, 2011 5:27pm EST
 
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By Claire Sibonney

TORONTO (Reuters) - Toronto's main stock index tumbled for a second day on Tuesday, closing at its lowest level in more than a week, as oil companies and gold miners succumbed to softer commodity prices, though strength in financial issues helped limit the losses.

The index's weighty energy and materials sectors were both down sharply, off 2.6 percent and 1 percent respectively.

Oil prices slipped after Kuwait's oil minister said OPEC was considering boosting production for the first time in more than two years, soothing investors' anxiety over spreading civil unrest in North Africa and the Middle East.

Easing crude prices -- with U.S. futures settling around $105 and Brent near $113 -- also tarnished the safe-haven allure of gold. U.S. gold futures for April fell below $1,430 an ounce after hitting a record high of $1,445.70 on Monday. Copper prices, however, bounced back from a two-week low.

Among the heaviest decliners, Suncor Energy sagged 4.2 percent to C$43.67, Canadian Natural Resources, dropped 3.4 percent to C$46.46, while Barrick Gold Corp fell 1.4 percent to C$50.80.

"Certainly last week was a very strong week for Canadian equities, so today is a continuation of the pullback we saw yesterday," said Jason Hornett, vice-president and fund manager at Bissett Investment Management in Calgary.

"Investors in Canada are probably repositioning their portfolios ... lowering their risk as we are seeing some strength in the consumer staples and other defensive groups," Hornett added, noting a better performance for utilities and pipeline companies.

Fertilizer producers were also big laggards as violent clashes in Libya and inflated oil prices continue to weigh on the outlook for a global economic recovery. Potash Corp, the world's largest fertilizer maker, extended its recent losses, falling 1.4 percent to C$56.67.   Continued...