March 26, 2010 / 6:57 PM / in 8 years

CANADA STOCKS-TSX reverses gains on Korea worries

 * TSX down 26.25 points to 11,931.86
 * Financials, energy lead index lower
 By Claire Sibonney
 TORONTO, March 26 (Reuters) - Toronto’s main stock index turned lower on Friday as the sinking of a South Korea naval vessel stoked geopolitical risk worries and spooked investor confidence.
 Stocks fell into negative territory after midday, reversing earlier gains for a second day in a row.
 Analysts said news of the ship sinking with 100 people on board hit sentiment, even though South Korea’s government said it was not clear if North Korea was involved in the incident. For full story, see [ID:nSGE62P0GW]
 The incident overshadowed earlier confidence European Union leaders agreeing  on a deal for debt-ridden Greece, pushing up resource-linked issues.
 “It just seems to me as if investors are looking for excuses to take some of their profits,” said Elvis Picardo, an analyst and strategist at Global Securities in Vancouver.
 “The underlying tone is still quite healthy, but given that we’ve come up quite substantially from last month’s lows, I think investors are a little trigger happy,” he added.
 At 2:49 p.m. EDT (1849 GMT), The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE dipped 26.25 points, or 0.21 percent, to 11,931.86.
 Eight of the 10 sectors were lower. Materials issues were 1.2 percent higher, reflecting firmer gold prices and copper at a two-week high. [GOL/] [MET/L]
 The heavily weighted financial sector was hit as Royal Bank of Canada (RY.TO), the country’s biggest lender, retreated 1.3 percent to C$59.61 and Toronto-Dominion Bank (TD.TO) almost 1 percent lower to C$75.76.
 The powerhouse energy sector was down 0.3 percent, with Suncor Energy Inc (SU.TO), the country’s largest oil company, down 0.6 percent to C$30.71, and natural gas major Encana Corp off 0.7 percent to C$30.34.
 Oil prices fell below $80 after data showed the U.S. economy grew less than expected last quarter, and the plan to bail out Greece failed to quell concern over fragile economic recovery. [O/R]  ($1=$1.03 Canadian)    

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