July 20, 2012 / 9:06 PM / 7 years ago

CANADA STOCKS-TSX rally fizzles on Spanish debt fears

* TSX ends down 42.79 pts, or 0.4 pct, at 11,622.91
    * Index still up 0.9 pct for the week
    * Financial, Energy lead losses
    * Spanish debt woes rattle markets

    By Jon Cook
    TORONTO, July 20 (Reuters) - Canadian stocks fell for the
first time in more than a week on Friday, led lower by energy
and financial shares, as oil slid and risk sentiment soured on
worries that Spain would require a full-blown bailout.
    Spain's main stock index suffered its biggest one-day drop
in two years, and the risk premium on government debt hit a
euro-era high at 7.32 percent after Spain's heavily indebted
Valencia region asked for financial aid. 
    "Europe continues to be dragged down by a lack of a
solution," said Rick Meslin, head of Canadian equities at UBS
Securities Canada. 
    Seven of Canada's 10 main sectors were lower. The powerhouse
    financial services subindex led declines, sliding 0.6
percent on the shaky euro zone outlook.
    Losses were sharpest among the major banks, with Royal Bank
of Canada falling 0.5 percent to C$52.41, Bank of Nova
Scotia down 0.9 percent at C$52.15, and
Toronto-Dominion Bank slipping 0.6 percent to C$80.
    The heavily-weighted oil and gas patch fell 0.5 percent as
U.S. August crude eased after hitting a two-month high on
    Energy declines were led by Cenovus Energy, which
dropped 1.2 percent to C$32.54, Talisman Energy, off
1.9 percent at C$11.05, and Canadian Natural Resources,
which edged down 0.7 percent to C$28.79.
    The Canadian market has recently been boosted by a rebound
in U.S. oil prices, which have risen steadily since falling
below $80 a barrel last month.
    However, Meslin cautioned that gains have been exaggerated
by weak summer volumes.
    "The market will rally on low volume, but then any kind of
news that doesn't support or further the momentum is what you
get today," he added.
    The Toronto Stock Exchange's S&P/TSX composite index
 finished down 42.79 points, or 0.4 percent, at
11,622.91. Despite the loss, the index was still up 0.9 percent
for the week.
    The materials group, which includes miners, finished flat as
gains from gold and fertilizer producers offset copper mining
losses. Goldcorp climbed 1.3 percent to C$34.04 and
Potash Corp edged up 0.6 percent to C$46.01. Meanwhile,
Canada's top copper miner, Teck Resources, fell 2.1
percent to C$30.59.
    "The medium-term trend is for lower commodity prices and it
will be until the worldwide economic situation is sorted out,"
said Brendan Caldwell, president and chief executive of Caldwell
Investment Management Ltd.
    In earnings news, shares of West Fraser Timber Co Ltd
 jumped 5 percent to C$53.50 a day after the lumber
company reported a second-quarter profit, on high lumber prices
and strong demand from Asia.
0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below