February 22, 2011 / 4:01 PM / 8 years ago

CANADA STOCKS-TSX decline cushioned by soaring energy

* TSX dips 7.28 points to 14,115.83

* Energy sector is lone riser, up 2.3 pct (Adds details)

By Ka Yan Ng

TORONTO, Feb 22 (Reuters) -Toronto’s main stock index was little changed on Tuesday morning as energy shares surged on a big jump in oil prices, limiting heavy declines across most of the rest of the market.

Fears that intensifying political tension in Libya, the third largest oil producer in Africa, could disrupt global economic growth boosted oil prices more than 5 percent, lighting a fire under the index’s oil and gas shares, which rose 2 3 percent.

Both Brent LCOc1 and U.S. crude oil CLc2 rallied to 2-1/2 year highs on concerns the revolt in Libya could spread to other major oil producers, while gold prices steadied above $1,400 an ounce. [O/R] [GOL/]

“There’s some reaction to the idea that these high oil prices could choke off the recovery to some extent,” said Michael Sprung, president at Sprung & Co Investment Counsel.

“The only sector that’s positive in Canada is energy, although gold is doing fairly well.”

Top blue-chip gainers were almost universally from the energy group. Safe-haven gold issues were also strong gainers, helping to cushion the slide in the index’s materials group, which fell 0.4 percent.

Suncor Energy (SU.TO) rose 2.8 percent to C$45.53, while fellow oil producer Canadian Natural Resources (CNQ.TO) gained 3.3 percent to C$48.82. Imperial Oil (IMO.TO) advanced 3.6 percent to C$49.87. Barrick Gold (ABX.TO) added 1.4 percent to C$51.54, while Goldcorp (G.TO) was up nearly 1 percent at C$44.90.

At 10:40 a.m. (1540 GMT), the Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE was down 7.28 points at 14,115.83. Nine of the 10 index sectors fell.

The slim decline in Toronto contrasted with steeper drops across world stock markets, which fell as Libyan leader Muammar Gaddafi signaled defiance of a revolt against his 41-year rule. He appeared on state television and denied he had fled the country. The uncertainty fueled a flight from risky assets. [ID:nLDE71L1CD] [MKTS/GLOB]

$=$0.98 Canadian Reporting by Ka Yan Ng; editing by Peter Galloway

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