August 14, 2013 / 9:07 PM / 6 years ago

CANADA STOCKS-TSX steady as banks offset surge in golds; eyes on Fed

* TSX falls 2.89 points, or 0.02 percent, to 12,639.30
    * Seven of 10 main index sectors decline
    * CN Rail has biggest negative influence on the market

    By John Tilak
    TORONTO, Aug 14 (Reuters) - Canada's main stock index ended
near flat on Wednesday as declines in the financial sector and
concerns about a pullback in the U.S. Federal Reserve's bond
buying offset a jump in shares of gold producers.
    Investors were, however, encouraged by data that showed
Germany and France grew more quickly than expected in the second
quarter, fueled by renewed business and consumer spending in the
region's two largest economies. 
    The market braced itself for a potential move, which many
say will come in September, by the Fed to begin withdrawing
support from its monetary stimulus program.
    "When the shoe drops, that could cause the market to have a
hiccup," said Lorne Steinberg, president of Lorne Steinberg
Wealth Management. "Even the hint that bond yields are going to
rise is negative for equities." 
    The Toronto Stock Exchange's S&P/TSX composite index
 closed down 2.89 points, or 0.02 percent, at
    The resource-heavy Canadian market, which eased from a
two-week high touched in the previous session, has been hit by
volatile commodity prices and is barely up since the start of
the year.
    "There is an increasing perception that slowing growth in
the emerging markets is not just a hiccup but will continue for
some time," Steinberg said. "That is making Canada less
attractive to foreign investors."
    Seven of the 10 main sectors on the index were in the red on
    Financials, the index's most heavily weighted sector, gave
back 0.2 percent.
    Royal Bank of Canada, the country's biggest lender,
lost 0.2 percent to C$63.93.
    Industrials slipped, with Canadian National Railway Co
 shedding 1.1 percent to C$101.23, having the biggest
negative influence on the market.
    But the materials sector, which includes mining stocks, rose
2.3 percent, helped by a 4.7 percent jump in shares of gold
producers. A surge in bullion benefited the miners.
    Goldcorp Inc gained 3.6 percent to C$30.35, and
Barrick Gold Corp added 4.8 percent to C$19.28.
    In company news, Rona Inc reported a
wider-than-expected second-quarter loss, weighed down by
restructuring costs and tough market conditions. Shares of the
home improvement chain slipped 3.7 percent to C$10.84.
    Shares of energy companies climbed 0.2 percent. 
    Suncor Energy Inc added 2.1 percent to C$33.79, and
Encana Corp rose 0.6 percent to C$18.09.
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