February 15, 2008 / 7:00 PM / 11 years ago

UPDATE 2-Toronto stocks pulled down by oils, economic fears

(Updates numbers, adds details, quotes)

TORONTO, Feb 15 (Reuters) - The Toronto Stock Exchange’s main index recovered some of its earlier losses but remained lower on Friday afternoon, weakened by nagging concerns over the prospect of a U.S. recession.

The S&P/TSX composite index .GSPTSE was down 56.69 points, or 0.43 percent, at 13,151.34 with seven of its 10 main sectors lower.

The heavyweight energy sector led the decline, falling 0.7 percent. EnCana (ECA.TO) was down C$1.21, or 1.7 percent, at C$69.56, and Suncor Energy (SU.TO) slid C$1.02, or 1.1 percent, to C$96.40.

The negative tone was sparked by heightened worries over the health of the U.S. economy after a series of bleak economic reports, including data that showed U.S. consumer sentiment was much lower than expected in February.

The index also continued to feel the fallout of Thursday’s statements by U.S. Federal Reserve Chairman Ben Bernanke, who said that he sees sluggish growth ahead.

“The general sentiment is negative on the financial side (and) certainly there’s more confirmation coming in every day that the United States is slowly but surely plodding into a recession,” said Lex Kerkovius, senior research analyst at McLean & Partners Wealth Management Ltd., in Calgary, Alberta.

“No one knows for sure, but I think the assessment is that they’re in a recession and they have to come to grips with that, and Bernanke’s testimony is certainly not helping people’s confidence there either.”

Kerkovius also said fears over the health of bond insurers and the overall credit market were putting downward pressure on financial stocks.

Bay Street’s banking shares gave up 0.5 percent. Bank of Montreal (BMO.TO) lost 75 Canadian cents, or 1.4 percent, to C$53.30, and National Bank of Canada (NA.TO) slid 99 Canadian cents, or 1.9 percent, to C$51.34.

On the upside, the gold producers subindex managed to hold on to gains of 0.7 percent, with Centerra Gold (CG.TO) up 16 Canadian cents, or 1.2 percent, at C$13.71 and Goldcorp (G.TO) rising 40 Canadian cents, or 1.1 percent, to C$36.63.

Agnico-Eagle Mines (AEM.TO) was up 44 Canadian cents, or 0.7 percent, at C$62.91 after it said its gold reserves reached a record at year-end, up 33 percent from the close of 2006.

HudBay Minerals Inc (HBM.TO) stumbled 62 Canadian cents, or 3.3 percent, to C$17.93 after its forecast suggested 2008 base metal production would be similar, or slightly lower, to last year.

Elsewhere, commercial printer Transcontinental Inc TLCa.TOTLCb.TO climbed 20 Canadian cents, or 1.3 percent, to C$15.82 after it said it had signed an exclusive deal to print the entire magazine portfolio of Rogers Communications (RCIb.TO).

$1=$1.01 Canadian Reporting by Leah Schnurr; Editing by Peter Galloway

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