CANADA STOCKS-Market hits 2-month closing low on energy sector

Thu Nov 8, 2012 4:48pm EST

* TSX ends down 39.54 points, or 0.32 pct, to 12,191.05
    * Canadian Natural drops 3.2 percent
    * Eight of 10 sectors decline

    By John Tilak
    TORONTO, Nov 8 (Reuters) - Canada's main stock index
finished at its lowest close in more than two months on
Thursday, as shares of Canadian Natural Resources Ltd 
slumped after the oil and gas producer cut its output forecast,
dragging on the energy sector.
    Shares reversed earlier gains in a bumpy session as
investors sifted through U.S. jobs data that indicated
improvement in the labor market and as the European Central Bank
left interest rates unchanged. 
    Investors also continued to worries over whether the United
States will reach a compromise to address its budget deficit and
avert a "fiscal cliff" of $600 billion in scheduled tax
increases and spending cuts beginning in January, which is seen
threatening the country's economic recovery .
    "We have a gridlock. The market is saying, 'Show us
something. Show us that you can resolve the problems that are
out there,'" said Levente Mady, senior portfolio manager at PI
Financial Corp.
    The Toronto Stock Exchange's S&P/TSX composite index
 ended down 39.54 points, or 0.32 percent, at
12,191.05, its lowest close in more than two months. Earlier it
hit an intraday low of 12,164.11, its softest level since Oct.
23.
    Eight of the index's 10 main sectors ended in negative
territory. Energy and financial shares led the decline, falling
1.2 percent and 0.6 percent, respectively.
    Shares of Canadian Natural Resources fell 3.2 percent to
C$28.02 after the country's biggest independent oil and gas
producer reported a 57 percent fall in quarterly profit and cut
its full-year forecast for crude oil and natural gas liquids
output. It played the biggest role of any single stock in
leading the market lower. 
    Some of Canada's major banks also dragged on the index.
Royal Bank of Canada, the country's biggest bank, fell
1.1 percent to C$55.72, and Toronto Dominion Bank lost
0.9 percent to C$80.30.
    "If things are not worked out, the financials are going to
be bearing the brunt. It is a very risky part of the market,"
Mady said.
    The market's losses were partially offset by gains in
Kinross Gold Corp, up 8.8 percent at C$10.16, and Sun
Life Financial, up 3.9 percent at C$25.31.
    Kinross on Wednesday posted a third-quarter profit that
topped expectations and said it expects to meet the higher end
of its production targets for the year. 
    Sun Life, Canada's No. 3 life insurer, said after markets
closed on Wednesday that it swung back to a third-quarter profit
due to better results from investments.  
    Sun Life's chief executive told Reuters on Thursday the
company is sticking with an admittedly "ambitious" target of C$2
billion in operating profit by 2015, despite a difficult outlook
for financial markets. 
    Gold miners made gains as prices for bullion surged in a
volatile session. Barrick Gold Corp rose 1.1
percent at C$36.56 and Goldcorp Inc climbed 0.9 percent
to C$44.91.
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