August 19, 2009 / 2:57 PM / 9 years ago

CANADA STOCKS-TSX pares early losses on bargain-hunting

* TSX down 0.64 percent at 10,605.96

* All 10 sectors down, but off session lows

* Chinese stocks selloff hurts recovery confidence (Adds details)

By Ka Yan Ng

TORONTO, Aug 19 (Reuters) - Toronto’s main stock index fell on Wednesday morning, after a selloff on Chinese markets dented confidence about the strength of the global economic recovery.

Those doubts triggered declines in commodity prices, a big weight on the resource-heavy Toronto index, spurred by the equity retreat in China, whose industrial engine is a huge market for commodities such as oil and metals.

The weakness spread to Europe and the trend was no different in the early going in the North American session.

Energy shares were knocked 0.6 percent lower but were chipping away at the losses as the price of crude oil reversed and headed higher. Materials were off 0.3 percent, but losses were limited as the price of gold turned higher as the U.S. dollar pared gains.

Influential movers on the overall index were mixed. Energy giant Suncor (SU.TO) led the pack lower, falling 1.43 percent to C$34.44, while insurer Manulife Financial (MFC.TO) shed 2.1 percent to C$21.24. BlackBerry maker Research In Motion RIM.TO slid 1.1 percent to C$80.60.

But there were a few big names that offset some of the early declines. Barrick Gold (ABX.TO), the world’s No. 1 producer, rose 0.6 percent to C$37.13, while Goldcorp (G.TO) climbed 0.3 percent to C$38.26.

Bank of Montreal (BMO.TO) gained 0.56 percent to C$49.98 and Canadian Natural Resources (CNQ.TO) inched up 0.3 percent to C$53.30.

The lowest point of the session was hit within minutes of the opening bell, with the TSX down 1.45 percent at 10,519, but the market clawed its way higher as investors looked for bargains.

At 10:25 a.m. (1425 GMT), the S&P/TSX composite index .GSPTSE was down 67.88 points, or 0.64 percent, at 10,605.96, after briefly handing back all of Tuesday’s 1.35 percent gain. All 10 of the index’s main groups were lower.

“It’s early in the morning. The selling that came out early was light. The market got marked down at the opening and now some bids are starting to show up,” said Bruce Latimer, a trader at Dundee Securities.

“I think there’s just some people out here who are value investors who think some names are cheap and they are picking their moments. There doesn’t seem to be a lot of aggressive selling out there,” Latimer said.

In individual company news, Sears Canada SCC.TO reported a sharp drop in quarterly profit as fragile consumer confidence and cool weather hurt sales at the country’s second-biggest department-store chain. [ID:nN19267908] Sears Canada was unchanged at C$21.

In economic news, Canadian consumer prices fell by the most in 56 years in the 12 months through July, when prices fell by 0.9 percent from a year earlier on sharply lower energy costs, Statistics Canada said. [ID:nN19458137] (Reporting by Ka Yan Ng; editing by Rob Wilson)

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