May 2, 2011 / 9:21 PM / 8 years ago

CANADA STOCKS-TSX retreats after bin Laden death, election eyed

   * TSX drops 10.28 points, or 0.07 percent, at 13,934.51
 * Eight of 10 index sectors rise, led by financials
 * Gold prices fall from record high after bin Laden death
 * Canadian election day overshadowed by bin Laden news  (Updates with details, comments)
 By Solarina Ho
 TORONTO, May 2 (Reuters) - Toronto’s main stock index closed lower on Monday, after hitting a three-week high earlier in the day, as oil and gas stocks erased gains and the death of Osama bin Laden sapped some of the safe-haven premium out of gold.
 The overall materials group, home to gold miners, was down 2.05 percent while the gold sub-index was off 2.69 percent.
 Gold miners were hit hard as gold prices fell off record highs as bin Laden’s death eroded their safe-haven appeal. Goldcorp (G.TO) was the biggest heavyweight decliner, down 5.24 percent at C$50.12, followed by Barrick Gold (ABX.TO), which fell 2.24 percent to C$47.24. Agnico Eagle (AEM.TO) gave back 3.84 percent to finish at C$63.39.
 Energy stocks ended the day off 0.01 percent. They shadowed movements in oil prices, which seesawed through the session as investors weighed the impact of Osama bin Laden’s death on crude futures. [O/R] One of the biggest movers, Imperial Oil (IMO.TO), was down 1.14 percent at C$49.43.
 “It looks like the market’s not quite sure how to take the death of bin Laden,” said Laura Lau, senior portfolio manager at Sentry Select Capital Corp.
 “Right off the bat oil was down, then it went up, and then it went down again, so they’re not quite sure if it’s good or bad. What we would expect is there probably will be some retaliation from terrorists for the deaths. Because of that, we can certainly expect added political risk,” she said.
 The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE finished the day down 10.28 points, or 0.07 percent at 13,934.51 after rising more than 1 percent to as high as 14,089.10, its strongest level since April 11, early in the day. Eight of the index’s 10 sectors were higher.
 Financial stocks, which make up roughly a third of the index’s weight, were up 0.81 percent.
 The rise was led by Manulife Financial (MFC.TO), which advanced 3 percent to C$17.50, and by Bank of Nova Scotia (BNS.TO), which was up 1.23 percent at C$58.40.
 Monday was election day in Canada but voting was overshadowed by the bin Laden news. Toronto stocks had traded cautiously in the final week leading up to the vote, with analysts attributing some of the retreat to wariness inspired by the surge of the left-leaning New Democratic Party in public opinion polls. [ID:nN29174448]
 The right-of-center Conservatives, who have governed Canada since early 2006, started the campaign with a healthy lead in the polls, but that dwindled as the NDP pushed past the Liberals to take a strong second place. [ID:nN02201446] [ID:nN29210714]
 “It’s certainly most worrisome if the NDP were to become official opposition. We would certainly be concerned about increased spending and increased taxation,” said Lau, adding that energy stocks could be in focus because of the possibility of added environmental costs.
 ($1=$0.95 Canadian)  (Editing by Peter Galloway)                                        

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