CANADA STOCKS-TSX skids nearly 2 pct on Iamgold, US fiscal woes

Wed Nov 14, 2012 5:10pm EST

* TSX ends down 204.87 points, or 1.69 percent, at 11,929.79
    * Index hits more than two-month low
    * Iamgold tumbles nearly 20 pct after results

    By John Tilak
    TORONTO, Nov 14 (Reuters) - Canada's main stock index
tumbled nearly 2 percent to its lowest level since early
September on Wednesday, hit by worries about U.S. budget
negotiations and European debt, and by a big drop in miner
Iamgold Corp after it reported weak results.
    The market tracked a dramatic decline on Wall Street, where
shares tumbled to late-July levels as investors grappled with
the possible repercussions of the U.S. "fiscal cliff," a series
of mandated tax hikes and spending cuts that start to take
effect early next year. 
    The index's materials sector, which includes mining stocks,
plunged 3.5 percent, with Iamgold down nearly 20 percent at
C$11.98 after it reported lower-than-expected quarterly earnings
on Tuesday and cut its production target for 2013.
 
    Other heavyweight decliners were Barrick Gold, down
3.8 percent at C$33.99, and Goldcorp, off 3.8 percent at
C$41.28.
    Also holding the market's attention was the debt crisis in
Europe, where there was a wave of strikes to protest spending
cuts and tax hikes contained in austerity programs. 
    Some investors expect focus will soon return to China, said
Youssef Zohny, portfolio manager with Stenner Investment
Partners, a unit of Richardson GMP.
    "After the dust settles, investors are going to start to
look at the economic fundamentals, especially at what's
happening in China," he said. The policies that will be unveiled
by China's new government will have a big impact on the
resource-heavy Canadian market, he added.
    The Toronto Stock Exchange's S&P/TSX composite index
 ended down 204.87 points, or 1.7 percent, at
11,929.79. Nine of the index's 10 sectors were lower. The
consumer staples group rose 0.3 percent.
    During the session, the index hit 11,915.07, its lowest
point since Sept. 4.
    Toronto's heavily weighted materials and energy groups were
hit hard because they are the most economically sensitive, said
Gavin Graham, president of Graham Investment Strategy. 
    "When people have concerns about the pace of economic
growth, particularly in the United States but also in China,
then they tend to sell off," he said.
    Financials were also down sharply, off 1.3 percent. Royal
Bank of Canada fell 1.1 percent to C$55.31, and Bank of
Nova Scotia was down 1.3 percent at C$53.18.
    Shares of Research In Motion were up 1.3 percent at
C$8.51. RIM's new line of BlackBerry 10 devices will provide the
 company with a framework for growth over the next decade,
offering long-term value for shareholders, Chief Executive
Thorsten Heins told Reuters in an interview. 
    Rona Inc was up nearly 5 percent at C$11.52 after a
large shareholder called for the replacement of the home
improvement retailer's board, leading to a revival of takeover
talk. 
    Loblaw Cos Ltd was up 0.9 percent at C$33.64 after
the grocer raised its dividend.
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