*TSX down 68.35 points at 12,551.34
*Eight of 10 sectors weaker (Adds details, commentary)
By Claire Sibonney
TORONTO, Oct 15 (Reuters) - Toronto’s main stock index retreated on Friday morning as gold miners fell on a lower bullion price and Potash Corp POT.TO dropped on a report that China’s Sinochem will not make a takeover bid for the company.
The gold subsector declined 1.1 percent after the price of the safe-haven precious metal slipped below $1,370 an ounce in volatile trade following a speech by U.S. Federal Reserve Chairman Ben Bernanke.
Barrick Gold Corp (ABX.TO), the world’s No. 1 producer, was down 1.3 percent at C$48.48. [GOL/]
Bernanke said that high U.S. unemployment and low inflation point to a need for further economic stimulus but he offered no details on the central bank’s next step in easing monetary policy. [ID:nN15187998]
“It looks like a lot of the fears of a very aggressive Fed turned into a little bit more of a cautious tone from Mr. Bernanke,” said Youssef Zohny, associate portfolio manager at Van Arbor Asset Management in Vancouver.
“Today we saw a little bit of a climax in terms of the quantitative easing bubble,” he added, noting that the stock market rally of the last couple months has been building on speculation of aggressive Fed action through quantitative easing — essentially creating new money to buy assets.
Also dragging heavily on the index, Potash Corp fell 1.1 percent to C$146.56 after sources told Reuters that China’s Sinochem Corp will not launch a counterbid for the world’s largest fertilizer market, abandoning efforts to spoil BHP Billiton’s (BHP.AX) $39 billion bid. [ID:nLDE69E01U]
At 10:26 a.m. (1426 GMT) the Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE was down 68.35 points, or 0.54 percent, at 12,551.34. Eight of the index’s 10 sectors were weaker including the key energy and financial groups.
Royal Bank of Canada (RY.TO) slipped 0.2 percent to C$55.08, and Suncor Energy (SU.TO) lost 0.6 percent to C$34.53.
($1=$1.01 Canadian) (Reporting by Claire Sibonney; editing by Peter Galloway)