September 6, 2011 / 9:39 PM / 7 years ago

CANADA STOCKS-TSX hits one-week low on euro zone debt fears

 * TSX down 83.87 points, or 0.67 percent, at 12,518.54
 * Eight of 10 sectors weaker; energy, banks drag
 * Gold miners partly offset losses  (Adds further details)
 By Trish Nixon
 TORONTO, Sept 6 (Reuters) - Toronto’s main stock market index fell to a one-week low on Tuesday, tracking U.S. and world stocks, as concern mounted that the euro zone’s worsening debt crisis will hurt the global economy.
 Nervous investors channeled cash into less risky assets as doubts resurfaced over the political will of Italy and Greece to push through tough budget and debt measures demanded by other euro zone members, while Germany hardened its stand against giving them more aid. [ID:nL5E7K61RE]
 The broad sell-off followed a 4 percent slide in European equities on Monday, when North American markets were closed for the Labor Day holiday.
 “All eyes are on Europe,” said Elvis Picardo, strategist and vice president of research at Global Securities in Vancouver. “Investors are getting seriously concerned about the possibility of not just a U.S. recession but a global recession.”
 Friday’s U.S. jobs report, which showed zero jobs growth, also continued to hurt investor confidence even after data on Tuesday showed U.S. services sector growth picked up in August. [.N]
 The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE ended the session down 83.87 points, or 0.67 percent, at 12,518.54. Earlier it fell to 12,355.92, its weakest point since Aug. 29.
 Eight of the 10 main groups were lower. Energy and bank shares weighed most heavily, down 1.8 percent and 1.2 percent respectively.
 Suncor Energy (SU.TO) was the top decliner, falling 2.4 percent to C$29.28. Royal Bank of Canada (RY.TO) lost 1.5 percent to C$48.22, and Bank of Nova Scotia (BNS.TO) was down 1.7 percent at C$52.23.
 Gold miners helped to offset losses as they added 1.5 percent and helped lift the broader materials sector into positive territory.
 The price of the safe-haven metal jumped to a record high above $1,920 after Switzerland pegged its currency to the euro in an effort to curb franc strength. Gold then retreated 2 percent from that level as investors took profits. [GOL/]
 “The Swiss franc was one of the safe-haven destinations away from the dollar and away from the euro, and that’s no longer the case. So it leaves gold more isolated as an alternative currency,” said Fergal Smith, managing market strategist at Action Economics.
 Seven of the top ten heavy advancers on the TSX were gold miners, led by Barrick Gold (ABX.TO), up 2.3 percent at C$53.15.
 Also supporting the index was Research In Motion RIM.TO, which rose 3.5 percent to C$30.63 after an activist shareholder said it wants the struggling BlackBerry maker to consider selling itself or spinning off its patent portfolio. [ID:nN1E7850LG]
 In other company news, shares of SNC-Lavalin Group (SNC.TO) dropped 4.5 percent to C$48.57 after news of a corruption investigation involving the engineering and construction company’s employees. [ID:nN1E7851CT]
 Yellow Media Inc YLO.TO dropped 12.2 percent to 79 Canadian cents after the Canadian telephone directory publisher said Chief Financial Officer Christian Paupe had resigned amidst a struggle to reduce debt and stave off competition. [ID:nL3E7K62UC]  (Editing by Jeffrey Hodgson)                  

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