TORONTO (Reuters) - Canadian stocks fell on Tuesday, weighed down by losses in heavyweight gold-mining and energy shares as bullion and oil dipped and investors brushed off a Greek debt deal, focusing instead on sluggish talks to avoid a looming U.S. fiscal crisis.
The U.S. Congress advanced by inches toward compromise on taxes and spending to try to avert the “fiscal cliff” that some fear will spur a recession but a firm deal still seemed miles away despite growing pressure from business interests for action.
“This is going to continue ad nauseam. Fiscal cliff is the theme of the day,” said Levente Mady, a senior portfolio manager at PI Financial Corp in Vancouver.
Initial optimism about a Greek debt-reduction deal gave way to worries about the lack of detail in the plan, hurting the euro. <FRX/>
“Obviously we had that bailout agreement in Greece and the euro is less than impressed with that package, so things are a little bit under pressure as a result of those two items,” Mady said.
The dual concerns weighed on oil and gold prices, and that pushed the shares of some of Canada’s biggest resource companies lower. <GOL/> <O/R> Miner Goldcorp Inc G.TO was the biggest drag on the index, falling 4.5 percent to C$38.95.
MINERS NOT PRIVY TO GOLD‘S RISE
Other heavily weighted resource stocks also slipped. Suncor Energy Inc SU.TO lost 1.3 percent to C$32.89, and miner Barrick Gold Corp ABX.TO and oil company Canadian Natural Resources Ltd CNQ.TO both shed 1.6 percent, to C$34.40 and C$27.92 respectively.
“People generally feel that gold is going higher, but the stocks suffer on an ongoing basis because ... it’s so easy to buy the commodity,” said Paul Harris, a portfolio manager at Avenue Investment Management, which manages $280 million.
After 12 hours of talks at their third meeting in as many weeks, Greece’s international lenders agreed on a package of measures to reduce the country’s debt by 40 billion euros.
“Maybe some people were expecting more positive news on Greece and so they sold off after it happened,” Harris said.
The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE ended down 73.42 points, or 0.6 percent, at 12,111.63.
Bombardier Inc BBDb.TO jumped 8 percent to C$3.37 after the planemaker signed a $7.8 billion deal to supply business jets to a private Swiss charter operator.
BlackBerry maker Research In Motion Ltd RIM.TORIMM.O slid 10.7 percent to C$10.70 after rising sharply since mid-month on optimism over its upcoming new devices. A research firm said RIM’s market share had fallen further in all but one of the markets the firm surveyed.
Reporting by Alastair Sharp; Editing by Jeffrey Hodgson, Jeffrey Benkoe and; Peter Galloway