November 3, 2009 / 4:35 PM / 9 years ago

CANADA STOCKS-TSX erases early skid as gold miners rally

 * TSX up 49.29 points at 10,927.64
 * Gold miners help erase early TSX skid
 * Drop in bank shares caps overall gain  (Recasts)
 By Frank Pingue
 TORONTO, Nov 3 (Reuters) - Toronto’s main stock index was higher on Tuesday as Barrick Gold Corp and other gold miners rallied on rising gold prices, while a surge in railway stocks helped to reverse the index’s early triple-digit skid.
 Barrick (ABX.TO) shares rose 5.9 percent to C$41.70, while Goldcorp (G.TO) followed with a gain of 5.5 percent to C$42.35.
 The price of gold hit a record high at $1,080.60 an ounce on Tuesday as the U.S. dollar fell ahead of a U.S. interest rate decision. [GOL/]
 Railway stocks also helped to drive the gain after news that Warren Buffett’s Berkshire Hathaway will buy railroad Burlington Northern in a $26 billion deal. [ID:nN03483590]
 That helped boost Canadian National Railway (CNR.TO) shares 2 percent to C$53.71, while Canadian Pacific Railway (CP.TO) shares rose 3.4 percent to C$48.80.
 “Everybody thinks (Buffett) is a bit of a guru so what he does kind of does affect the markets and in this case all the railroads of course are having a nice start to the day,” said John Kinsey, portfolio manager at Caldwell Securities Ltd.
 By 11:15 a.m. (1615 GMT), the S&P/TSX composite index .GSPTSE was up 49.29 points, or 0.45 percent, at 10,927.64.
 Earlier it had fallen as much as 126 points to 10,751.72 as bank shares were unloaded due to concerns about the European banking sector.
 Heavyweight bank shares remained under pressure due to poor results from UBS UBSN.VS and a shakeup of British banks Lloyds (LLOY.L) and Royal Bank of Scotland (RBS.L).
 Shares of Royal Bank of Canada (RY.TO) shares were down 1 percent at C$54.26, while Bank of Nova Scotia (BNS.TO) fell 0.5 percent to C$46.00.
 “They are having sympathy pains,” Kinsey said. “European banks started this earlier and it’s come across the pond and is just spreading.”
 ($1=$1.07 Canadian)  (Editing by Peter Galloway)                                      

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