March 17, 2009 / 3:45 PM / 10 years ago

CANADA STOCKS-TSX little changed as gold drops; banks climb

* TSX index down 0.05 percent at 8,382.85

* Materials drop as bullion price retreats (Adds details, quotes)

By Jennifer Kwan

TORONTO, March 17 (Reuters) - Toronto’s main stock index was little changed on Tuesday morning as hopes that the global banking system is stabilizing boosted financials, even as a drop in the price of bullion hurt the materials sector.

At 11:06 a.m. (1506 GMT), the S&P/TSX composite index .GSPTSE was down 3.86 points, or 0.05 percent, at 8,382.85, with four of its 10 main groups lower.

The main index started the day off on firmer footing, but see-sawed for much of the morning.

The hefty financials group, home to banks and insurance companies and heavily weighted in the index, rose 0.6 percent, extending five straight days of gains.

Energy issues also gained, rising 0.7 percent as oil rose above $48 a barrel ahead of U.S. inventory data expected to shows a build in crude stocks. [ID:nSP469633]. EnCana (ECA.TO) rose 0.8 percent at C$50.47.

But the materials group, down 2.3 percent, kept the pressure on the downside with miner Goldcorp (G.TO) lower by 2.7 percent at C$36.11.

“There’s so many cross currents out there,” said Sal Masionis, stockbroker at Brant Securities. “People are still very frustrated and can’t figure out what’s happening.”

Financials have rallied in recent sessions on reassuring statements made by some banks about their performance, easing fears about the ailing banking system. This spurred a rally in the broader equity markets. Royal Bank of Canada (RY.TO) climbed 1 percent at C$35.85.

However, the broader problem is economic data remains weak, said Masionis.

“We still don’t know where this whole thing is going to end or where the bottom is. We had a nice trading rally. How long will it go? Who knows,” he said.

“We want to see some actual, physical signs of recovery in the economy.”

Elsewhere, Ecuador lifted a mining ban on Kinross (K.TO) and Corriente CTQ.TO that allows the Canadian miners to restart operations immediately, a government official told Reuters on Tuesday. [ID:nN1711122]

Kinross fell 2.9 percent, while Corriente rose 3.6 percent.

Other stocks on the upside included Research in Motion RIM.TO, up 2.4 percent at C$50.99 and Enbridge (ENB.TO), which climbed 3.4 percent at C$39.20. ($1=$1.27 Canadian) (Reporting by Jennifer Kwan; Editing by Jeffrey Hodgson)

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