July 14, 2008 / 5:10 PM / 11 years ago

UPDATE 2-Toronto stocks dip as banks offset resources

(Updates to midday)

* TSX retreats as financials weigh

* Banks hurt by jitters over credit crunch

* Duvernay jumps on bid from Royal Dutch Shell

TORONTO, July 14 (Reuters) - The Toronto Stock Exchange’s main index retreated into negative territory on Monday, dragged down by weak financials amid anxiety over further fallout from the credit crisis.

The renewed worries rattled markets as initial optimism over a proposed U.S. government rescue plan for mortgage finance giants Fannie Mae FNM.N and Freddie Mac FRE.N evaporated quickly on Monday morning.

Bay Street’s financials took their cue from south of the border, sliding 2 percent. All the major Canadian banks were down with Toronto-Dominion Bank (TD.TO) off C$2.05, or 3.5 percent, at C$56.67, and Canadian Imperial Bank of Commerce (CM.TO) down C$1.51, or 2.9 percent, to C$50.70.

The S&P/TSX composite index .GSPTSE was down 14.39 points, or 0.1 percent, at 13,694.71 shortly after midday, with seven of its 10 main sectors lower.

On the upside, Duvernay Oil DDV.TO was the biggest gainer by weight after Royal Dutch Shell (RDSa.L) offered C$5.9 billion ($5.9 billion) for the Calgary-based company. Duvernay’s shares shot up C$23.62, or 40.4 percent, to C$82.06.

The news gave a boost to the broader energy sector, which climbed 1.3 percent, though the price of oil was off. Elsewhere in the group, Canadian Natural Resources (CNQ.TO) gained 62 Canadian cents, or 0.7 percent, to C$93.12.

The materials sector also helped soften the downward momentum, boosted by buoyant gold prices. Goldcorp (G.TO) rose 94 Canadian cents, or 1.9 percent, to C$49.94, while the group as a whole added 0.9 percent.

The sector also saw acquisition activity, after Barrick Gold (ABX.TO) said it was launching a C$354 million hostile bid for Cadence Energy CDS.TO. Barrick edged up 5 Canadian cents, or 0.1 percent, to C$50.05, while Cadence surged 69 Canadian cents, or 12.7 percent, to C$6.13.

Shares of Bombardier (BBDb.TO) added 24 Canadian cents, or 3.4 percent, to C$7.35 after the company announced the launch of its much anticipated CSeries airliners over the weekend. ($1=$1.00 Canadian) (Reporting by Leah Schnurr; editing by Rob Wilson)

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