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Toronto stocks hit new high, then turn tail
Tuesday, May 20, 2008
TORONTO (Reuters) - Toronto's main stock market index
briefly rose beyond the 15,000-point mark for the first time on
Tuesday, but then fell into negative territory as worries over
the future of the buyout of BCE Inc
The Toronto Stock Exchange's S&P/TSX composite index <.GSPTSE> rose 23.84 points, or 0.2 percent, to 15,008.04, before turning lower. At midmorning it was down 54.36 points, or 0.4 percent, at 14,949.84.
The market was closed on Monday for Canada's Victoria Day holiday.
"Mondays are generally slow and this is a Monday on a Tuesday, so we're starting out slow," said Paul Hand, managing director at RBC Capital Markets. "Oils have a bid but everything else is mixed and we're still sorting out a theme."
Seven of the TSX index's 10 main groups were lower, led down by a 1.5 percent drop in the telecommunications group and a 1 percent fall among materials issues.
Telecommunications shares were led lower by BCE, which dropped C$1.50 to C$37.32 on worries that the C$34 billion buyout of the firm may be in jeopardy.
Sources close to the deal said earlier this week the buyout of the big Canadian phone company was on shaky ground as the banks backing the deal sought to renegotiate the financing terms. The banks presented new terms to the buyout group on Friday, a source said.
Materials shares were led lower by fertilizer producer
The National Post newspaper reported that the two companies were eyeing expansion of key West Coast ports to serve Asia.
Gold-mining shares cushioned some of the blow as the country's top producers basked in the glow of firm gold prices, which sat around $912 an ounce.
Energy shares also rose as the price for U.S. crude oil
briefly hit a record high of $129.31 a barrel. Suncor Energy
(Reporting by Scott Anderson; editing by Peter Galloway)
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