CANADA STOCKS-TSX slips as gold miners weigh, banks trade higher

Tue, 31 Dec - 7:39am
 (Adds portfolio manager comment, details; updates prices to 
close) 
    * TSX ends down 6.59 points, or 0.05 pct, at 13,581.39 
    * Gold miners weigh, bullion heads for historically bad year 
 
    By Alastair Sharp 
    TORONTO, Dec 30 (Reuters) - Canada's main stock index 
slipped marginally in light trade on Monday, with major gold 
miners weighing heavily as bullion headed for its worst annual 
performance in 32 years, while gains for some financial stocks 
softened the blow. 
    Two of the world's largest gold producers had the most 
negative impact on the index, with Goldcorp Inc    falling 
3.7 percent to C$22.25 and Barrick Gold Corp    off 2.6 
percent at C$18.20. 
    Still, the index wasn't far off its Friday peak, which was 
the highest level seen since mid-2011. Investors expressed 
optimism that 2014 will exceed that roughly 9 percent gain the 
Toronto index is on track to notch this year. 
    "I think commodities will outperform next year," said Marcus 
Xu, a portfolio manager at MY Capital Management in Vancouver.  
    Canada is home to an abundance of resource-related 
companies, whose struggles have partly explained the Toronto 
Stock Exchange's S&P/TSX composite index    
underperformance versus U.S. indexes this year. 
    Xu said the price of various resources was weighed down by 
investors concerned about Chinese growth and troubles in China's 
financial and real estate sectors, and that those issues were 
being resolved after a leadership transition. 
    The Canadian index has sharply underperformed the broad S&P 
500    index, whose 30 percent gain has driven it to 
all-time highs. 
    The annual gain for the S&P 500 and other U.S. indexes was 
supported by the U.S. Federal Reserve's massive stimulus 
efforts, which the central bank only this month decided to start 
to trim. 
    "On balance, we believe 2014 is going to be a better year 
than 2013," said John Kinsey, a portfolio manager at Caldwell 
Securities. "That's based on some of the economic numbers...the 
U.S. reduced their taper, they seem to think their economy is 
going to find some traction." 
    The Canadian index ended down 6.59 points, or 0.05 percent, 
at 13,581.39. It traded in a tight 25-point range in the 
session. 
    On the positive side, Valeant Pharmaceuticals International 
Inc    gained 2.8 percent to C$124.94, Toronto-Dominion 
Bank    added 0.4 percent to C$100.08, and Bank of Nova 
Scotia    rose 0.5 percent to C$66.22.   
    The price of gold has fallen nearly 30 percent this year, 
weighing on the many mining companies listed in Toronto and 
dragging down the index as a whole.  
    An index of global gold miners, mostly Canadian companies, 
has fallen 48 percent this year. 
    Caldwell's Kinsey said that the depressed price of gold - 
now at $1,200 an ounce - should lead to mine closures which in 
turn would put a floor under the price and help the sector 
stabilize next year. 
    MY's Xu wasn't so sure. "Gold is still under a lot of 
pressure. I'm not as eager to jump into the gold sector versus 
the other commodity sectors," he said.  
     
     
 
 (Editing by Meredith Mazzilli and Leslie Adler) 
 ((alastair.sharp@reuters.com)(+1 416 941 8118)(Reuters 
Messaging: alastair.sharp.thomsonreuters.com@reuters.net)) 
  
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Keywords: MARKETS CANADA/STOCKS   
     
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