*TSX down 117.02 points, or 1.0 percent, at 11,601.61
*BMO slides after results miss Street view
*Potash gains on lingering takeover optimism (Updates to midmorning, adds quote)
By Jennifer Kwan
TORONTO, Aug 24 (Reuters) - Toronto’s main stock index fell sharply on Tuesday morning as concerns over domestic growth and the global recovery pressured commodity prices, while results from Bank of Montreal (BMO.TO) disappointed.
The index’s key financial sector dropped 1.9 percent and led the fall.
Bank of Montreal, a top net loser, said its quarterly profit rose 20 percent as it set aside much less money for bad loans, but it missed expectations as trading income dived. BMO shares fell 3.8 percent to C$56.84. [ID:nN24241238]
“BMO’s earnings came in below expectations. Other banks are down in sympathy,” said Francis Campeau, broker at MF Global Canada in Montreal.
The market worried that other Canadian banks would report similar results and pushed their shares down. Royal Bank of Canada (RY.TO), Canada’s biggest lender, dropped 2.3 percent, while Toronto-Dominion Bank (TD.TO) fell 1 percent.
At 9:57 a.m. (1357 GMT), the Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE was down 117.02 points, or 1.0 percent, at 11,601.61.
Even without the disappointing results from BMO, the market would’ve traded lower along with global markets on worries about economic recovery, Campeau said. “There’s the classic global jitters hitting the market,” he said.
Nine of the index’s main sectors were lower, with resource issues weighing heavily as the price of oil, gold and base metals fell on broader recovery concerns. [O/R] [GOL/] [MET/L] [MKTS/GLOB]
Toronto stocks moved in lockstep with U.S. equities, which tracked global equities lower as investors grew concerned over the pace of economic recovery after U.S. home sales data came in weaker than expected. [ID:nN24196313] [.N]
In Canada, data showed retail sales rose less than expected in June, pushing down the Canadian dollar. [ID:nN24252766]
On the upside, takeover target Potash Corp of Saskatchewan POT.TO rose 0.8 percent to C$159.37, and was a top net gainer as the market speculated it would attract a higher takeover bid from BHP Billiton (BLT.L) (BHP.AX), or possibly another player. [ID:nSGE67N08C]
BHP has offered about $39 billion, or $130 a share, for Potash.
$1=$1.06 Canadian Reporting by Jennifer Kwan; editing by Peter Galloway