* TSX down 48.27 points, or 0.38 percent, at 12,781.76
* Energy and bank stocks hardest hit; gold miners rise
By Alastair Sharp
TORONTO, March 18 Canada's main stock index
slipped on Monday, weighed down by financial and energy shares,
as skittish investors pulled back after Cyprus raced to revise a
radical bailout plan that included a divisive tax on bank
The Cyprus bailout sent shockwaves across asset classes,
with Brent crude hitting a three-month low, the euro tumbling
and safe-haven bullion gaining.
In Canada, financials suffered the biggest hits, despite
scant evidence domestic lenders were exposed to the
Mediterranean island's banks, and oil and gas companies were
hurt by the fall in crude.
"It's all Cyprus," said Fred Ketchen, director of equity
trading at ScotiaMcLeod. "This will be, I hope, relatively
short-lived but nevertheless it frightens everybody."
The euro zone agreed over the weekend to give Cyprus a
bailout worth 10 billion euros ($13 billion), but demanded
depositors in its banks forfeit some money to stave off
bankruptcy despite the risks of a wider bank run.
The Toronto Stock Exchange's S&P/TSX composite index
ended the session down 48.27 points, or 0.38 percent,
Still, in the longer term, many analysts think a rally that
took the index to a 19-month high will resume, given the limited
returns offered elsewhere.
"There is a huge amount of money on the sidelines, tied up
in fixed income and comparatively unproductive markets. It's got
to go somewhere," said Rick Hutcheon, chief operating officer at
RKH Investments, who suggests energy stocks could gain as signs
grow of a U.S. economic recovery.
"If the U.S. actually begins to crank up again, they're
going to be using energy," he said.
But for the day, energy stocks weighed heavily, with Suncor
Energy Inc down 1.9 percent to C$31.08 and Encana Corp
off 1.5 percent at C$20.41.
Banks were among the biggest decliners, with Bank of Nova
Scotia off 0.8 percent to C$59.84 and Toronto Dominion
Bank down 0.6 percent at C$84.53.
"I certainly don't think Canadian banks are all of a sudden
going to find themselves in the same spot," Ketchen said.
"However, it's more a reaction to the overall influence that
Cyprus is having on the psychology of the market."
Gold hit a two-week high as its safe-haven properties proved
alluring, helping Canada's long-suffering gold miners offset
some of the broader losses.
Barrick Gold Corp rose 1.3 percent to C$29.59 and
Yamana Gold Inc gained 1.4 percent to C$15.06.