The Toronto Stock Exchange's main dropped more than 100 points on Friday, as energy and resource issues gave up ground despite firmer commodity prices, and US rate and credit fears weighed on investors. The S&P/TSX composite index fell 109.7 points, or 0.8 percent, to close at 13,986.03.
Every one of the index's 10 main groups declined, including the resource-laden materials subindex and the energy sector, which fell 0.92 percent and 0.99 percent, respectively. "What we are seeing is a new bout of volatility," said Elvis Picardo, investment strategist at Northern Securities Inc in Vancouver. "We're seeing the commodity prices bounce around and we're seeing commodity stocks bounce around as well."
US crude advanced to above $69 a barrel on fears related to a general strike in Nigeria that could disrupt shipments, while gold futures for August rose 0.4 percent to $657 an ounce, feeding off a weaker US dollar and the rise in crude. Still, this failed to lift energy and gold shares, which dragged the TSX to finish the week on a weak note.
Suncor Energy shed C$1.19, or 1.2 percent, to C$96.09. EnCana Corp slipped 81 Canadian cents, or 1.1 percent, to C$70.05. In golds, Agnico-Eagle Mines Ltd dropped 91 Canadian cents, or 2.3 percent, to C$38.72. Kinross Gold fell 25 Canadian cents, or 1.8 percent, to C$13.51.
The S&P/TSX 60 index of Canadian blue chips also tracked lower, giving up 7.22 points, or 0.9 percent, to end at 802.44. Overall market volume was 321 million shares worth C$5.8 billion. Decliners easily outpaced advancers 973 to 573. Worries about higher interest rates and the strength of the US credit market in the wake of mortgage woes south of the border also worried investors.
"If there's anything different from when the market was bounding ahead a few weeks ago, it's the fact that interest rates are higher," said Gavin Graham, chief investment officer at the Guardian Group of Funds in Toronto. Picardo agreed, adding that even though the market is sitting not far from the 14,000 mark, "the problems with the subprime mortgage market and rising interest rates south of the border are hitting us as well."
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