TMX Broadcast Centre manager Kris Backus walks in front of the centre's display board in Toronto on Monday May 16, 2011. The homegrown group making a $3.6-billion proposal for TMX Group (TSX:X) says its Ðtruly Canadian" bid wouldn't mean job cuts or a management shakeup and the operator of the Toronto Stock Exchange would remain publicly traded.Frank Gunn
Canadian stocks fell on Thursday, despite assurances from key European leaders that they will work toward greater integration of the European economy as nerves remain frayed over the region's sovereign-debt crisis.
The S&P/TSX composite index closed at 11,485.32, down 86.39 points or 0.8 per cent. U.S. markets were closed for the Thanksgiving Day celebrations, but European and Asian indexes also fell.
Leaders of Germany, France and Italy met to discuss the latest twists of the debt crisis, which has raised alarms that the euro as a common currency is threatened. They pledged to reveal a plan of closer economic integration at the next European Union summit on Dec. 9. However, Germany again insisted that the European Central Bank should not play a bigger role in the crisis.
At the same time, bond yields continued to rise, underlining skepticism that Europe will be able to solve its crisis. Yields on 10-year Italian government bonds rose to about 7.1 per cent, moving deeper into territory that observers believe will create funding issues for the country. Even Germany bond yields rose, approaching 2.2 per cent and widening the spread with comparable U.S. government bonds, highlighting the fact that even Europe's biggest and strongest economy is not immune to the crisis.
The Canadian losses were broad, affecting all 10 subindexes within the composite index. Commodity producers were among the biggest laggards: Suncor Energy Inc. and Canadian Oil Sands Ltd. fell 0.9 per cent each, Barrick Gold Corp. fell 1.4 per cent and Potash Corp. of Saskatchewan Inc. fell 1.7 per cent.
Financials were also generally quite weak. Canadian Imperial Bank of Commerce fell 1.4 per cent and Toronto-Dominion Bank fell 0.8 per cent.