June 28, 2010 / 9:41 PM / 9 years ago

CANADA STOCKS-TSX falls as resource shares drag

* TSX down 100.85 points at 11,607.

* Weak energy, gold prices weigh

* G20 summit fails to lift market (Adds details, quotes)

By Claire Sibonney

TORONTO, June 28 (Reuters) - Toronto’s main stock index fell broadly on Monday, driven lower by commodity weakness in general and a steep drop in gold prices in particular.

Gold retreated 1 percent on a technical sell-off and a decline in safe-haven buying after an initial rally that might have lifted gold to a record high fizzled.[GOL/]

“I think the biggest movement today was a strong reversal in the precious metal sector,” said Francis Campeau, broker at MF Global Canada in Montreal.

Gold-mining stocks were down 1.3 percent with shares of Barrick Gold (ABX.TO) falling 0.5 percent to C$47.86, and Goldcorp Inc (G.TO) losing 0.8 percent to C$46.74.

U.S. crude oil futures also ended lower as Tropical Storm Alex in the Gulf of Mexico took a path that was little threat to oil and natural gas production. [O/R]

The TSX index’s energy sector slipped 1.6 percent. Suncor Energy Inc (SU.TO) was off 0.8 percent at C$33.00, and EnCana Corp (ECA.TO) slumped 2.7 percent to C$33.12.

The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE closed 100.85 points, or 0.86 percent, lower at 11,607.00. Seven of its 10 main groups were down.

“We’re seeing a decline in the index because all three heavyweight groups are down,” said Elvis Picardo, analyst and strategist at Global Securities in Vancouver.

In addition to the weaker energy and materials sectors, banking issues also fell after leaders at the Group of 20 summit in Toronto on the weekend agreed to give banks more time to adopt tougher rules. [ID:nN27241260]

“The push for a gradual increase in bank capital may put Canadian banks at a slight disadvantage,” added Picardo.

Decliners included Royal Bank of Canada (RY.TO), down 0.8 at C$52.81, and Toronto-Dominion Bank (TD.TO), 0.9 percent lower at C$70.69.

The G20 meeting provided little direction for the market as leaders agreed to let countries take different paths toward assuring lasting growth and making their banking systems safer. That was a reflection of the uneven and fragile economic recovery in many countries. For more G20 news, please see: [ID:nN18322198]

While targets for debt and deficit ratios in the G20 communique were mildly positive for the market, analysts said they were skeptical about implementation and warned that markets are focused on broader issues right now. [ID:nN27235152]

“Following the summit, we kind of opened flat across the world,” Campeau said. “I don’t think the summit had a huge impact on the indices.”

As well, base-metal miners dropped 2.6 percent after copper eased as a more cautious global economic outlook emerged from the G20 summit, weighing on prospects for future demand of the metal. [MET/L]

Teck Resources, the country’s biggest base-metal producer, dropped 3.8 percent to C$33.86.

In a reading that was a positive for sentiment, U.S. consumer spending rose moderately in May even as savings touched the highest in eight months, suggesting a tepid economic recovery was still intact. [ID:nN28253397]

“There’s been some positive data for a change in terms of the consumer spending and consumer incomes,” said Picardo. “Especially because it comes after a string of fairly weak data from the U.S. so this is certainly lending some support to the markets today.”

$1=$1.04 Canadian Reporting by Claire Sibonney; Editing by Frank McGurty

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