May 30, 2012 / 8:58 PM / 7 years ago

CANADA STOCKS-TSX tumbles on Spain, China worries

* TSX ends down 176.08 pts, or 1.52 pct, at 11,433.22
    * Index has shed more than 7 pct in May
    * Energy, materials tumble on Spain, China woes
    * RIM's shares plunge more than 7 pct

    By Jon Cook	
    TORONTO, May 30 (Reuters) - Toronto's main stock index hit a
one-week low on Wednesday as oil and gas and mining firms
slumped on increased global growth fears, fueled by the
escalating euro zone debt crisis and signs from China that it is
not planning a large economic stimulus.	
    Rising borrowing costs for Spain and Italy and the latest
poll showing a lead for Greece's left-leaning, anti-austerity
parties ahead of next month's elections added to concerns about
the region's economy being enveloped in the debt turmoil.	
    "There is this huge uncertainty sitting out there in front
of the market," said David Cockfield, managing director and
portfolio manager at Northland Wealth Management. "As long as it
doesn't get mitigated some way or other, it's just going to keep
on scaring the daylights out of people."	
    All of Canada's 10 main sectors finished lower. The
heavyweight energy sector slid almost 4 percent as U.S. crude
fell nearly $3 and was on track for its biggest percentage
monthly loss since December 2008. 	
    Declines were led by major oil and gas producers. Canadian
Natural Resources plunged 6.8 percent to C$29.85,
Suncor Energy slipped 3.6 percent at C$28.15 and Cenovus
Energy fell 3 percent at C$32.10.	
    The base metals mining index fell more than 3 percent, as
copper prices plumbed a 2012 low. Miners on the downside
included Teck Resources, which slid 3.7 percent to
C$31.29, Potash Corp, down 0.8 percent at C$40.63, and
First Quantum Minerals, down 3.4 percent at C$17.67.	
    The Toronto Stock Exchange's S&P/TSX composite index
 finished down 176.08 points, or 1.52 percent, at
11,433.22, its lowest close in a week. The index has slumped
more than 7 percent so far in May.	
    Financial shares were also shaken by fears about Greece and
Spain, falling 1.1 percent. Top insurer Manulife Financial
 led losses, down 4.5 percent to C$10.90.
Toronto-Dominion Bank shed 1.2 percent at C$77.99, while
Royal Bank of Canada dropped 0.7 percent to C$50.64.	
    Weak housing data from the United States also compounded the
gloomy global growth picture as U.S. pending home sales
unexpectedly fell in April to a four-month low. 	
    Declines were stemmed after the European Commission threw
Spain two potential lifelines on Wednesday, offering more time
to reduce its budget deficit and direct aid from a euro-zone
rescue fund to recapitalize distressed banks. 	
    A mid-session recovery by gold miners helped pare some
losses. Barrick Gold climbed 1.3 percent to C$40.24 and
Goldcorp Inc was up 2 percent at C$37.89. 	
    "If people are worried about preserving value, surely gold
should be some place you go rather than sell," said Cockfield.	
    Hopes that China would act to counter slowing growth were
dimmed after influential academics said Beijing should shun
aggressive fiscal stimulus, in remarks published in leading
state-backed newspapers on Wednesday.	
    Those views joined a chorus of commentary countering market
expectations that China might unveil a stimulus package similar
to the 4 trillion yuan ($630.1 billion) in spending unleashed
during the global financial crisis. 	
    Also weighing on sentiment was Research In Motion,
whose shares plunged more than 7 percent near an eight-year low
at C$10.66 on Wednesday, a day after the once iconic BlackBerry
maker warned it would likely report a shocking first-quarter
operating loss. 	
    Canadian Pacific Railway Ltd shares slipped 2.2
percent to C$75.08 on Wednesday after news that a strike at
Canada's second biggest railway would not end until Friday at
the earliest. 	
    Not all sentiment was dour, however, as some saw an
opportunity to invest in downtrodden Canadian stocks, most
notably in the energy and mining sectors.	
    "Their valuations are getting close to 2008 levels," said
Michael Greenberg, portfolio manager at Franklin Templeton
Investments. "Clearly, some of those sectors are pricing in some
pretty bad news so for us that's an opportunity to start
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