May 4, 2011 / 3:08 PM / 8 years ago

CANADA STOCKS-TSX hits 7-week low on exit from resources

 * TSX sheds 1.28 percent to 13,518.39
 * Commodity prices continue retreat
 * Disappointing results add to market’s negative sentiment
 * Nine index sectors fall  (Adds details)
 By Ka Yan Ng
 TORONTO, May 4 (Reuters) - Toronto’s main stock index fell sharply on Wednesday morning, pulled down by lower prices for oil and other commodities and extending losses from Tuesday, when it suffered its biggest one-day drop in almost two months.
 Disappointing results and forecasts at some blue-chip Canadian companies also weighed, as did an industry report that showed the pace of growth in the U.S. services sector eased unexpectedly in April. [ID:nN04125050] .
 Crude oil futures fell in volatile trade, while copper dropped to a seven-week low. Silver and gold recovered some losses but precious metals remained under pressure after a strong rally in the past few weeks. [O/R][GOL/] [MET/L]
 “Commodity prices have been coming down the last few days and it seems to be hitting stocks,” said Ian Nakamoto, director of research at MacDougall, MacDougall & MacTier.
 The index’s energy group, down more than 2 percent, suffered an additional blow from a quarterly loss reported by independent oil and gas producer Talisman Energy TLM.TO. Its stock slid about 6 percent to C$21.09, one of the biggest falls on the index. [ID:nN03291511]
 Canadian Natural Resources (CNQ.TO), off 3 percent at C$41.91, was slightly more of a drag on the overall index.
 At 10:50 a.m. (1450 GMT), the Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE was down 173.98 points, or 1.28 percent, at 13,518.39, hitting its lowest point in seven weeks. Nine of its 10 sectors were lower.
 The index’s materials group, down more than 1 percent, was pulled lower by Agrium Inc AGU.TO, even though it reported a quarterly profit that beat expectations due to strong fertilizer prices. Analysts said weakness in the share price was linked to the company’s forecast of a slightly weaker second-quarter performance than analysts had expected. [ID:nN04213122].
 Agrium fell more than 5 percent to C$79.26.
 Torstar (TSb.TO) was another notable decliner, falling more than 10 percent to C$12.21 after the publisher of Canada’s biggest daily newspaper reported lower-than-expected quarterly profit. [ID:nL3E7G41ZN]
 Grocery chain Loblaw Cos Ltd (L.TO) rose 2.1 percent to C$40.90 after reporting higher quarterly earnings as margins improved and a drive to boost the profitability of its private-label products bore fruit. [ID:nN03152408]
 Magna International (MG.TO) climbed 1.5 percent to C$49.20 after it reported a 44 percent jump in quarterly profit and beat expectations. [ID:nN03126866]
 ($1=$0.96 Canadian)   (Reporting by Ka Yan Ng; editing by Peter Galloway)                                        

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