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CANADA STOCKS-TSX flat, unswayed by Greek bailout deal
February 9, 2012 / 5:35 PM / in 6 years

CANADA STOCKS-TSX flat, unswayed by Greek bailout deal

* TSX down 11.05 pts, or 0.1 pct, at 12,509.97

* Financials fall on Manulife earnings

* Miners lifted by higher gold, copper prices

* Greek bailout deal lifts sentiment

By Jon Cook

TORONTO, Feb 9 (Reuters) - Canada’s main stock index was little changed at midday on Thursday as losses among financial issues offset gains in mining shares after Greek leaders clinched a highly anticipated debt deal.

Greece’s agreement to adopt new austerity measures was expected to pave the way for a 130 billion euro ($172 billion) aid package that may help it avoid a disorderly default that would spillover into global financial markets.

The Greek breakthrough, however, failed to rally Canadian stocks as investors remained nervous about the overall state of the euro zone economy and focused on some weak corporate earnings.

“The market is confused because there are so many cross currents going on out there,” said Sal Masionis, a stockbroker at Brant Securities.

At noon (1700 GMT), the Toronto Stock Exchange’s S&P/TSX composite index was down 11.05 points, or 0.1 percent, at 12,509.97.

Financial issues dragged on the index as Manulife Financial’s shares fell 1 percent to C$11.98 after Canada’s biggest life insurer reported a quarterly loss, citing the weaker global economy and losses from lower interest rates. It also said chief financial officer Michael Bell would step down.

The drag of low interest rates on Manulife’s results seemed unlikely to end soon. On Thursday, the European Central Bank held rates at a record low, seeing tentative signs of economic stabilization, but policymakers suggested rates could yet fall.

Last month, the Bank of Canada said it would hold its main interest rate at 1 percent until 2013. The U.S. Federal Reserve recently extended its rate freeze until late 2014.

The telecommunications services sector was hurt by weak earnings from BCE Inc, whose shares tumbled 2 percent to C$40 after Canada’s largest telecommunications company reported a quarterly profit that fell short of forecasts. BCE said price competition during the holiday season and costs related to its Internet-based TV product weighed on its results.

Nearly all of the TSX’s top 10 main sectors were negative, but the heavyweight materials group kept the index within break-even range, up 0.2 percent on gains from miners.

Diversified miner Teck Resources was the biggest riser, up 0.8 percent at C$41.09 after copper hit a five-month high as the Greek deal strengthened the euro and made U.S. dollar-priced metals cheaper for investors.

Barrick Gold was also among the leaders, climbing 0.3 percent to C$49.06 as bullion prices rose 1 percent, piggybacking on the euro.

Gold is up more than 10 percent this year. The precious metal has traditionally acted as a hedge against weakening economic conditions.

“These commodities are telling you the market is nervous about the future of the (global) economy,” Masionis said.

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