July 31, 2008 / 1:19 AM / in 9 years

Toronto stocks sag along with oil price

TORONTO (Reuters) - The Toronto Stock Exchange’s main index fell on Thursday, sliding late in the session as energy and other resource issues were knocked lower by a drop in oil prices.

<p>A Toronto Stock Exchange (TSX) logo is seen in Toronto November 9, 2007. REUTERS/Mark Blinch</p>

The materials sector followed energy stocks lower as gold producers gave up earlier gains. Goldcorp (G.TO) lost 4.3 percent after it reported an unexpected quarterly loss and said to will buy Gold Eagle Mines GEA.TO for about C$1.5 billion.

Weak U.S. economic data underlined worries about dampening fuel demand and sent oil down $2.69 to settle at $124.08 a barrel. The retreat helped knock 3.1 percent off Canadian Natural Resources (CNQ.TO).

Sun Life Financial (SLF.TO) was one of the biggest drags by weight, falling 6.1 percent after reporting its profit fell 12 percent due to weak results at its U.S. insurance and asset-management businesses.

John Kinsey, portfolio manager at Caldwell Securities Ltd, said that Sun Life came in worse than expected, surprising investors although expectations had not been high.

“They had warned after the first quarter that the whole year might be soft because of all the problems everybody knows about - the strong dollar, the weak U.S. economy and the weak U.S. financial markets, and that’s basically what hurt them,” Kinsey said.

The S&P/TSX composite index .GSPTSE closed down 90.30 points, or 0.66 percent, at 13,592.91, but just three of its 10 main sectors were on the downside, with the bulk of the losses coming from the energy and materials sectors.

The two groups were down 2.5 percent and 1.7 percent, respectively. In the oil patch, Suncor Energy (SU.TO) was down C$2.76, or 4.7 percent, at C$55.66, and Canadian Natural Resources fell C$2.57 to C$80.01.

A round of quarterly results showed that gold producers were hampered by surging production costs, despite a sharp increase in gold prices.

Goldcorp posted a surprise loss amid steep cost inflation and said it would by Gold Eagle to pick up the Bruce Channel gold discovery. Gold Eagle soared C$1.71, or 16.2 percent, to C$12.28, while Goldcorp was down C$1.70 at C$38.15.

Centerra Gold (CG.TO) fell 36 Canadian cents, or 6.5 percent, to C$5.20 after it said its profit tripled, but it suspended arbitration proceedings while it tries to arrive at a deal with the Kyrgyz government over sharing income from its Kumtor mine.

Sun Life slipped C$2.57 to C$39.80 However, the financial sector overall was up 0.2 percent, with Canadian Imperial Bank of Commerce (CM.TO) up 74 Canadian cents, or 1.2 percent, at

C$61.98.

Also on the upside, Rothmans Inc ROC.TO gained C$3.53, or 13.5 percent, to C$29.70 after Philip Morris International (PM.N) said it would buy Canada’s No. 2 cigarette maker for about C$2 billion.

The index fell 6 percent for the month, continuing the downward trend from late June to fall into an official correction, defined as a drop of at least 10 percent from the record high.

Persistent worries over fallout from the credit crunch and the outlook for the global economy, as well as energy shares that have slipped along with oil prices have taken the index into 13,000 territory for the first time since April.

Market volume was 385 million shares worth C$8.7 billion. Advancers outpaced decliners 820 to 696. The blue chip S&P/TSX 60 index .TSE60 closed down 7.28 points, or 0.89 percent, at 811.73.

On Wall Street, stocks fell after earnings from Exxon Mobil (XOM.N) disappointed and economic data spurred worries of a U.S. recession. The Dow Jones industrial average .DJI closed down 205.67 points, or 1.78 percent, at 11,378.02, and the Nasdaq Composite Index .IXIC edged down 4.17 points, or 0.18 percent, at 2,325.55.

($1=$1.02 Canadian)

Editing by Peter Galloway

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below