October 28, 2010 / 9:06 PM / in 7 years

CANADA STOCKS-TSX ends flat as golds 'save the day'

* TSX slips 0.03 percent to 12,564.09

* Golds surge, nearly offset 8 declining sectors

* Potash profit jumps but stock ends lower (Adds details)

By Ka Yan Ng

TORONTO, Oct 28 (Reuters) - Toronto’s main stock index ended slightly lower on Thursday as strength in gold-mining issues was not quite enough to offset broad weakness in other index sectors and a drop in Potash Corp (POT.TO) shares.

Eight of the index’s 10 main groups were lower, but a 1.3 percent rally in materials, home to gold-mining stocks, balanced the losses, even a 3.8 percent decline by heavyweight Potash Corp.

The fertilizer giant posted quarterly results and issued an outlook that far surpassed expectations on Thursday, but its stock dropped on a report that Ottawa is leaning toward blocking BHP Billiton’s (BHP.AX) $39 billion hostile takeover bid. [ID:nN28266653]

Overall, the Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE finished down 3.16 points, or 0.03 percent, at 12,564.09.

The gold-mining subgroup gained 2.6 percent, spurred by firm bullion prices and strong earnings at Barrick Gold (ABX.TO) on Thursday, as well as at Goldcorp (G.TO) and Agnico-Eagle (AEM.TO) the day before. [ID:nN28108425] [ID:nN27265533]

Barrick rose 2.41 percent to C$48.07, while Goldcorp jumped 4.59 percent to C$45.31. Agnico-Eagle gained 6.03 percent to C$77.23.

Supporting the resource-heavy index, commodity prices firmed as the U.S. dollar slipped, with investors eagerly awaiting next week’s key U.S. Federal Reserve meetings.

“A weak U.S. dollar brings strong gold, and combined with strong earnings, gold stocks save the day,” Francis Campeau, broker at MF Global Canada, in Montreal.

Miners were also boosted after Canadian lawmakers on Wednesday defeated a controversial bill that would have raised the bar on their human rights and environmental standards overseas. [ID:nN27254250]

Figures on Thursday that showed new U.S. claims for unemployment benefits fell to a three-month low last week were seen as reducing the chances of the Fed taking drastic action to ease monetary policy to try to stimulate the economy.

“People are tempering their expectations on the amount of (Fed) quantitative easing just based on the economic data,” said Youssef Zohny, associate portfolio manager at Van Arbor Asset Management in Vancouver.

The market also reacted to a heavy load of corporate results.

Nexen Inc NXY.TO and Cenovus Energy Inc (CVE.TO) said operational problems weighed on their quarterly results, prompting investors to pull away from shares of the Canadian oil sands producers. [ID:nN28262354]

Cenovus Energy shed 1.8 percent to C$28.57, while Nexen slipped 1.25 percent to C$21.35.

Contract electronics maker Celestica Inc (CLS.TO) plunged 5.4 percent to C$8.59 after posting a quarterly profit that trailed estimates, hurt by lower demand. [ID:nSGE69R0IO]

Business software maker Open Text OTC.TO slumped 4.82 percent to C$44.45 after it reported a 52 percent jump in quarterly profit, but had disappointing licensing revenue. [ID:nN27142091]

But big-screen movie company Imax Corp IMX.TO surged 12.95 percent to C$21.89 after reporting an 80 percent rise in quarterly earnings, beating estimates. It forecast its theater network will grow faster in 2010. [ID:nSGE69B0JO]

And RioCan Real Estate Investment Trust (REI_u.TO) rose 1.5 percent to C$22.83 after its results beat expectations. [ID:nSGE69Q0N7]

Research In Motion RIM.TO ended little changed at C$57.35, after dropping more than 3 percent earlier in the session after Oppenheimer cut the rating on the BlackBerry maker to “perform” from “outperform”, citing mounting competition. [ID:nWNAB7672]

$1=$1.02 Canadian Additional reporting by Claire Sibonney; editing by Peter Galloway

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