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By Leah Schnurr
TORONTO, March 27 (Reuters) - The Toronto Stock Exchange’s main index edged slightly higher on Thursday, lifted by gains in banks and telecom company BCE Inc, but sentiment was wary and the market was unable to find much traction.
The banks led the upside, adding 1.1 percent, with Bank of Montreal (BMO.TO) rising 93 Canadian cents, or 2.1 percent, to C$45.93, and Bank of Nova Scotia (BNS.TO) up 78 Canadian cents, or 1.7 percent, at C$46.92.
BCE Inc (BCE.TO) also supported the benchmark, recovering from Wednesday’s selloff to gain C$1.22, or 3.4 percent, to C$36.94 after U.S. radio operator Clear Channel Communications CCU.N said it won a temporary court ruling that prevents banks from backing out of their commitments to fund its $20 billion buyout.
After the bell, Canada’s telecoms regulator approved the C$34.8 billion ($34.1 billion) buyout of BCE by an investors group, subject to a number of conditions.
BCE had fallen on Wednesday amid worries that its buyout could be on the rocks as some of the banks funding the deal are involved with the Clear Channel buyout, which is reported to be in jeopardy because of the credit crisis.
The S&P/TSX composite index .GSPTSE closed up 13.92 points, or 0.1 percent, at 13,405.78 with half of its 10 main sectors on the downside.
It was the fifth day in a row that the index closed higher, but it seesawed through the day in tentative trade.
Lex Kerkovius, senior research analyst at McLean & Partners Wealth Management Ltd in Calgary, Alberta, said that Bay Street appeared to be seeking direction.
“It’s sort of sitting on that knife’s edge where nobody quite knows where it’s going,” Kerkovius said.
Research In Motion RIM.TO was the biggest weighted drag on the benchmark, shedding C$5.63, or 4.7 percent, to C$114.52, as it was caught up in pessimism over the tech sector south of the border after software firm Oracle Corp ORCL.O reported revenue that fell short of expectations. Toronto’s small tech sector was off 0.4 percent.
The materials sector dipped 0.3 percent, hampered by declines in gold producers, with the gold-mining subindex off 1.8 percent. Yamana Gold (YRI.TO) was down 89 Canadian cents, or 5.4 percent, at C$15.75, and Agnico-Eagle Mines AEM.TO slipped 73 Canadian cents, or 1 percent, to C$71.57.
The mining subindex bucked the downward trend of the larger materials sector, helped by Teck Cominco TCKb.TO which rose 52 Canadian cents, or 1.2 percent, to C$42.42. Teck said it was not looking to put itself up for sale in the wake of the breakdown of takeover talks between Vale (VALE5.SA) and Xstrata XTA.L.
Specialty metals firm Timminco Ltd TIM.TO jumped C$4.81, or 23 percent, to C$25.70 after it announced a contract to supply solar grade silicon to Germany’s Q-Cells AG QCEG.DE.
The banking sector, which has been battered by fallout from the U.S. subprime mortgage crisis, has made gains in five out of seven sessions.
“I think people are maybe saying the Canadian situation’s different than this subprime (problem in the United States),” said John Kinsey, portfolio manager at Caldwell Securities.
“It’s just our asset-backed commercial paper, and if we can get these straightened out, maybe it’s not as bad as it seems.”
Market volume was 441 million shares worth C$7.8 billion. Decliners outpaced advancers 824 to 757. The blue chip S&P/TSX 60 index .TSE60 closed up 0.99 points, or 0.13 percent, at 787.18.
In New York, stocks were hurt by Oracle’s soft results, while the banks were hit by rumors that Lehman Brothers Holdings LEH.N could suffer a similar fate as Bear Stearns BSC.N.
The Dow Jones industrial average .DJI was down 120.40 points, or 0.97 percent, at 12,302.46 and the Nasdaq Composite Index .IXIC fell 43.53 points, or 1.87 percent, to 2,280.83.