CANADA STOCKS-TSX steady in low volume as investors eye fiscal cliff

Mon Nov 12, 2012 4:35pm EST

* TSX ends down 5.34 points at 12,191.46
    * Energy and materials fall, financials rise

    By Claire Sibonney
    TORONTO, Nov 12 (Reuters) - Canada's main stock index was
little changed in quiet trade on Monday as concerns about the
possibility of a fiscal crisis in the United States offset
encouraging Chinese economic data.
    With U.S. and Canadian bond markets closed for the Veterans
Day and Remembrance Day holidays, activity was light. Volume was
a sparse 107 million shares, compared with the daily average of
281.9 million traded in October.
    Energy and gold-mining shares were among the top laggards on
the index as the underlying commodity prices fell.  
    Miner Goldcorp Inc was down 1.9 percent at C$43.44
and oil producer Canadian Natural Resources lost 2.1
percent to C$27.87.
    Overall, Canadian shares took their cue from uncertainty on
Wall Street over whether the United States can avoid the "fiscal
cliff," a combination of government spending cuts and tax
increases set to go into effect early next year, threatening a
recession, unless Congress and the White House reach a deal to
avoid it.
    "All eyes are on the fiscal cliff ... I think you're going
to see a sideways moving market until you get some sort of
direction of which way the fiscal cliff is going to go," said
Sadiq Adatia, chief investment officer at Sun Life Global
Investments.
    "Either you have a very nice bounce in January or you get
the opposite direction and you see a big selloff if the fiscal
cliff does not get resolved."
    The Toronto Stock Exchange's S&P/TSX composite index
 ended down 5.34 points, or 0.04 percent, at 12,191.46,
after bouncing between positive and negative territory
throughout the day.
    "People are still a little bit confused and they're kind of
waiting I think to see what Mr. Obama is going to do," said John
Kinsey, portfolio manager at Caldwell Securities. "It's a very
large overhang for the market."
    The index started the day on slightly firmer ground after
data showed Chinese exports picked up sharply in October,
signaling the giant economy was gathering strength.
 
    "My expectation is that we will get a steady round of
positive news from China which will help out the commodities,"
said John Ing, president of Maison Placements Canada.
    Still, the data was not able to trump worries of a drawn-out
U.S. budget impasse, as well as concerns about delays to an
installment of Greek aid to help pay off its debt. 
    Seven of the TSX's 10 sectors were higher, including
financials, up 0.4 percent, as investors bought into Canada's
stable and dividend-paying banks as a safe-haven bet in an
uncertain, low-interest-rate environment.
    Toronto-Dominion Bank rose 0.8 percent to C$80.68,
Bank of Nova Scotia was up 0.3 percent to C$53.98.
    Insurers also helped lift the sector, as Manulife Financial
 gained 1 percent to C$12.30 and Sun Life Financial
 added 1.3 percent to C$26.49.
    In individual company news, Research In Motion rose
2.9 percent to C$8.81 after announcing it plans to introduce its
long-delayed BlackBerry 10 platform and devices on Jan. 30.
 
    Canadian home-improvement retailer and distributor Rona Inc
 climbed 4.6 percent to C$10.59, though the company and
U.S. rival Lowe's Cos Inc both denied a newspaper report
that they were back in takeover talks. 
    Canadian home furnishing retailer Leon's Furniture Ltd
 rose 2 percent to C$11.80 after announcing it is buying
smaller domestic rival The Brick Ltd, which surged 52
percent to C$5.32, in a deal worth about C$700 million.
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