TORONTO - The Toronto stock market was little changed Friday afternoon with strength coming primarily from energy shares while the index was pressured by gold and technology stocks.
New York markets were down sharply as investors focused on more trouble in the U.S. mortgage sector.
Toronto's S&P/TSX composite index slipped 5.14 points to 13,504.41 at midafternoon.
The TSX is still headed for a gain of around 200 points for the week as commodities surged, including oil which closed above US$100 a barrel earlier in the week.
"Overall, the market hasn't done badly since the lows hit on Jan. 21,'' said Jennifer Dowty, portfolio manager at MFC Global Investment Management.
"We had a lot of sharp gains, especially in the resource sector. Things are a bit different because China is now the largest consumer of a lot of these materials and that's why I believe this resource rally that we're seeing is sustainable going forward.''
Investors also took in a major acquisition. U.S.-based First Reserve Corp. is buying oil and gas industry helicopter operator CHC Helicopter Corp. (TSX:FLY.A) in a deal valued at $3.7 billion. CHC shares soared 39 per cent to $30.43.
"That's another thing I think is going to help support the marketplace _ a lot of companies are flush with cash and a lot of our Canadian assets are extremely attractive,'' said Dowty.
The TSX Venture Exchange was down 13.60 points to 2,647.21.
On Wall Street, the Dow Jones industrial average moved down 97.94 points to 12,186.36 after losing 143 points Thursday amid economic data that reinforced U.S. recession worries.
The Nasdaq composite index fell 31.27 to 2,268.51 while the S&P 500 index surrendered 12.22 points to 1,330.31.
The Canadian dollar was down 0.37 of a cent to 98.51 cents US after a mixed retail showing. Overall sales rose 0.6 per cent to about $35.1 billion in December. But excluding a 3.2 per cent rise in auto purchases, retail activity fell 0.4 per cent, against the 0.3 per cent gain economists had expected.
"After a string of very weak reports for December, today's retail sales result is a modest dose of relief, even if ex-auto sales dipped,'' BMO Nesbitt Burns deputy chief economist Doug Porter wrote in a commentary.
"It still looks like December GDP fell heavily (possibly as much as minus 0.5 percentage point) due to the earlier reported steep declines in exports, wholesale trade, housing starts and manufacturing sales in the month.''
American markets got an early lift after the U.S. producer price index for November was revised to a 0.3 per cent drop from a 0.1 per cent dip.
This was good news to investors worried that recent high inflation readings could limit Federal Reserve interest rate cuts.
But the market is also concerned about the credit crisis spawned by securities linked to U.S. mortgages that have sharply deteriorated.
U.S. government-sponsored mortgage backer Freddie Mac was downgraded Friday to "sell'' by Merrill Lynch.
On the TSX, the financial sector slipped 0.2 per cent with Royal Bank (TSX:RY) off 53 cents to $49.86 a day after announcing it would acquire Phillips, Hager & North Investment Management Ltd. , a Vancouver mutual fund and asset management company, in exchange for 27 million shares currently worth $1.36 billion.
The energy sector gained almost one per cent as the April crude contract on the New York Mercantile Exchange moved up 42 cents to US$98.65 a barrel.
Penn West Energy Trust (TSX:PWT.UN), Canada's largest energy trust, said its fourth-quarter profit rose three per cent to $127 million before two major acquisitions were completed last month. Its units gained 35 cents to $28.75.
Gold prices were little changed after hitting a record intraday high Thursday. The April bullion contract on the Nymex dipped 40 cents to US$947.80 an ounce and the TSX gold sector was down 1.2 per cent.
Barrick Gold (TSX:ABX) faded 77 cents to $50.35. Kinross Gold Corp. (TSX:K) dipped 73 cents to $23.11 after a fourth-quarter profit of US$173.1 million, up from US$41 million a year ago.
The tech sector shrank 1.7 per cent after U.S. software maker Intuit Inc. posted a 21 per cent decline in quarterly profit. Sector heavyweight Research In Motion Ltd. (TSX:RIM) fell $2.73 to $105.27.
Rogers Communications Inc. (TSX:RCI.B) shares were down 57 cents to $38.43 even as Canada's largest operator of cellphone and cable TV systems reported a 44 per cent increase in fourth-quarter profit to $254 million.
Shares in Bombardier Inc. (TSX:BBD.B) were six cents lower at $5.66 after the transportation equipment giant authorized formal sales proposals for its CSeries aircraft, a major step toward a program launch this year. The CSeries is designed for the smaller end of the 100- to 149-seat airliner segment.
Two months after its $1.35-billion initial public offering, Franco-Nevada Corp. (TSX:FNV) announced a $232.5-million issue of new equity. The resource-sector royalty and investment company's shares fell 92 cents to $21.78.
