CANADA STOCKS-U.S. data, Syria push TSX off three-month high

Mon Aug 26, 2013 5:28pm EDT

* TSX falls 2 points, or 0.02 percent, to 12,760.30
    * Eight of the 10 main index sectors decline
    * Potash jumps 2.4 percent, Agrium up 3.3 percent
    * CIBC, TD gain as companies work on Aeroplan deal

    By John Tilak and Rod Nickel
    TORONTO, Aug 26 (Reuters) - Canada's main stock index ended
little changed on Monday after political tension in Syria and
sluggish U.S. economic data weighed on sentiment, offsetting
gains made by producers of gold and fertilizer on a jump in
commodity prices.
    The Toronto market's benchmark index eased from the
three-month high it hit earlier in the session after U.S.
Secretary of State John Kerry said the Syrian government was
trying to cover up evidence of a deadly chemical attack,
signaling the United States was edging closer to a possible
military response. 
    Also undermining sentiment was data that showed orders for
long-lasting U.S. manufactured goods had the biggest drop in
nearly a year in July, as well as news that Silvio Berlusconi's
center-right party threatened to bring down Italy's coalition
government over a vote to expel the former prime minister from
parliament.  
    North American fertilizer producers Potash Corp and
Agrium Inc benefited from a spike in U.S. corn and
soybean futures as hot and dry crop weather threatened crop
yields.
    Fertilizer stocks traditionally track prices of grain and
oilseeds on the notion that farmers tend to buy more fertilizer
in periods of high crop prices to maximize production.
    Potash Corp shares, which were hit earlier this year by news
of the breakup of a large potash cartel, had the biggest
positive influence on the index, according to Reuters data.
Potash stock jumped 2.4 percent to C$32.10; Agrium was up 3.3
percent to C$94.07.
    "Both stocks were badly mauled by the fears of the breakup
of the cartel," said John Ing, president of Maison Placements
Canada, adding that "you would see a bounce with any glimmer of
good news".  
    He said it was too early to tell what impact the
post-consortium environment would have on the companies. "We
don't know how Potash and Agrium will perform in a new pricing
regime."
   The Toronto Stock Exchange's S&P/TSX composite index
 closed down 2 points, or 0.02 percent, at 12,760.30.
Eight of the 10 main sectors on the index were in the red.
    Industrials shed 0.9 percent. Canadian Pacific Railway Ltd
 lost 2.3 percent to C$125.78.
    Shares of energy companies gave back 0.2 percent, with
Suncor Energy Inc declining 0.7 percent to C$35.81.
    In the mining sector, Barrick Gold Corp added 2
percent to C$21.52, and Goldcorp Inc gained 0.8 percent
to C$32.87 as U.S. gold futures firmed 0.6 percent,
extending their 1.6 percent rally on Friday. 
    Silver prices also rose, helping lift Silver Wheaton
Corp up 3 percent to C$29.99.
    "It's a reflection of the fact that commodities have started
to come off of their bottom," said Craig Fehr, Canadian market
strategist at Edward Jones in St. Louis, Missouri. "We're
starting to see a little bit of a rebound there."
    In company news, Canadian Imperial Bank of Commerce 
said it was still in talks to retain about half of its Aeroplan
credit card portfolio after Toronto-Dominion Bank 
replaced it as the issuer of the popular flight rewards card.
 
   CIBC added 1 percent to C$80.69, and TD was up 0.2 percent at
C$88.96.
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