CANADA STOCKS-TSX drops as China data fuels resources dip

Mon May 13, 2013 4:38pm EDT

* TSX falls 59.54 points, or 0.47 percent, to 12,529.55
    * Five of 10 main sectors decline
    * Gold shares shed 2.5 percent
    * BlackBerry gains, lifting technology sector
    * Silver Wheaton slips after results

    By John Tilak
    TORONTO, May 13 (Reuters) - Canada's main stock index
declined on Monday after sluggish Chinese economic data hurt
commodity prices and dampened enthusiasm for shares of materials
and energy companies.
    China's factory output growth was surprisingly feeble in
April and fixed-asset investment slowed, rekindling concerns
that the recovery is stalling. 
    The resource-heavy Toronto market is sensitive to
developments in China, a big consumer of commodities from
Canada, because of its large exposure to materials and energy
stocks.
    An unexpected rise in U.S. retail sales in April failed to
lift sentiment.
    "Any hint of weakness in China does not help export-focused
markets like Canada and Australia," said Matt Skipp, president
of SW8 Asset Management.
    "Before committing any money on the long side at the moment,
I want to see what this very significant commodity weakness is
telling us about the global economy," he added.
    The Toronto Stock Exchange's S&P/TSX composite index
 closed down 59.54 points, or 0.47 percent, at
12,529.55. 
    "There's a tremendous amount of nervousness in the markets,"
said Sal Masionis, a stockbroker at Brant Securities.
    "People don't have confidence," he added. "Interest rates
are low, there's lots of money out there, but there's nowhere to
go."
    Five of the 10 main sectors on the index were in the red.
    The materials sector, which includes mining stocks, lost 2.1
percent as gold stocks shed 2.5 percent.
    Bullion prices fell about 1 percent as the U.S.
dollar firmed on signs of an improving economy and as holdings
in exchange-traded funds slipped. 
    Miner Barrick Gold Corp gave back 2.9 percent to
C$20.50 and was the biggest negative influence on the market.
    Silver Wheaton Corp's first-quarter earnings came
in slightly below expectations and the company changed its
dividend policy to tie the payout to performance over a whole
year. The stock fell 3.5 percent. 
    The price of oil slipped, pulling energy shares down 0.6
percent. 
    Financials, the index's most heavily weighted sector, was
down 0.2 percent.
    BlackBerry gained 2.1 percent to C$16.04, helping
lift the information technology sector up 0.7 percent.
FILED UNDER: