May 12, 2011 / 8:47 PM / 8 years ago

CANADA STOCKS-Resources drag TSX lower in volatile session

   * TSX ends down 30.32 points, or 0.23 pct, at 13,389.42
 * Eight of the index’s 10 main groups lower  (Recasts, updates with closing numbers)
 By Solarina Ho
 TORONTO, May 12 (Reuters) - Toronto’s main stock index closed lower on Thursday after a volatile session, as battered commodity prices pared losses but continued to weigh on resource shares.
 The index swung widely from a steep early drop on fears of slower economic growth and lower commodity demand, into positive territory and back into the red, tracking volatile moves in commodity prices.
 The energy and materials groups — which together make up about 50 percent of the index’s weight — were down 0.15 percent and 0.82 percent respectively.
 Suncor Energy (SU.TO) was off 1.09 percent at C$38.88, while Agnico Eagle (AEM.TO) was down 1.65 percent at C$59.44. Barrick Gold (ABX.TO) eased 0.87 percent to C$43.44. Uranium miner Cameco Corp (CCO.TO) slid 4.87 percent to C$25.37.
 Crude prices rebounded as a weakening U.S. dollar offset demand worries. The weaker greenback — which fell against the euro on expectations of European rate hikes — also helped gold, silver and copper pare big losses. [O/R] [GOL/] [MET/L] [COM/WRAP]
 “It totally reflects the overall feeling of uncertainty in the market. It’s one of those times where investors are really not sure if the glass is half empty or half full. That’s why we’re seeing this sort of action,” said Elvis Picardo, an analyst and strategist at Global Securities.
 “We have broken through the support level at 13,500. And of course the downside action is a familiar one.”
 The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE closed down 30.32 points, or 0.23 percent, at 13,389.42. The index, which has retreated in seven of the past nine sessions, fell more than 1 percent on Thursday morning before rebounding. Eight of the index’s 10 sectors were lower.
 “We’re getting to the stage where it’s overdone. The trade is all one way: everybody’s pessimistic, everybody’s negative, everyone’s throwing in the towel,” said Rick Hutcheon, president and chief operating officer of RKH Investments.
 “I think we’re in the final throes of a short-term correction. I think the end is near, probably by the middle of next week, we’ll be heading back up again ... I think we’ve paid for it.”
 Picardo noted that the factors plaguing market sentiment were nothing new and have been weighing on the market for a long time: concerns over China, euro zone debt and the economic recovery.
 “When you have something like that, sentiment can really turn on a dime,” he said. “So investors have to be prepared for this sort of volatility.”
 Corporate earnings on Thursday were mixed. BCE Inc (BCE.TO), which reported a 16 percent rise in operating profit, was up 2.57 percent at C$37.89, making it the lead blue-chip gainer. [ID:nN10106124] The overall telecoms group was ahead 0.8 percent.
 Canadian Tire (CTC.TO) (CTCa.TO) rose 2.1 percent to C$62.60 after it reported a higher profit, helped by retail sales growth. [ID:nN12279700]
 Tim Hortons THI.TO, which posted a higher profit but missed market estimates, was among the big losers, sagging 4.07 percent to C$45.92. [ID:nN12290169]
 ($1=$0.97 Canadian)  (Editing by Rob Wilson)                                        

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