Fueled By Energy Issues, TSX Recovers From Early Slump - But Still Closes 70 Pts In Red!

Canada's main stock market recovered from early falls that saw it touch a day low near 11,420 inside the opening 30 minutes on concerns about Spain and Greece. While it ended the session down nearly 80 points, it did succeed in getting back to levels higher than that it opened at and with mostly upward momentum, fuelled by buying in energy stocks.

There were reports that up to six more regions in Spain may need financial aid from the central government after Valencia asked for funds on Friday. This sent the yield on Spanish 10-year debt to a euro-era high of over 7.5%. Crude oil for September delivery on the New York Mercantile Exchange ended down $3.69, or 4%, at US$88.14 a barrel, dragged lower by a stronger U.S. dollar and concerns about Spain.

Elsewhere, the International Monetary Fund on Monday dismissed report that it may refuse to continue supporting Greece as it prepared to meet with the new Greek government on details of its bailout.

Nearly all of the TSX's sub-sectors were in negative territory, with energy being one exception in gaining about 2.5% after a busy news day for companies within that sector.

Nexen Inc. (NXY.TO), the day's most actively traded with more than 45 million shares traded, jumped more than 50% and hit year highs after China National Offshore Oil Company made a bid to purchase the Calgary oil and gas producer for $15 billion.

Talisman Energy Inc. (TLM.TO) gained nearly 7% as it announced that it has reached an agreement in the North Sea with Sinopec International Petroleum Exploration and Production Corporation, whereby Sinopec will acquire a 49% equity interest in Talisman's UK North Sea business, Talisman Energy (UK) Limited (TEUK), for $1.5 billion.

In other non related news, investor Prem Watsa has lifted his stake in Research in Motion Ltd (RIM.TO) to near 10% as at July 4, according to a regulatory filing. RIM gained 1.5% today. Watsa, the CEO of Canadian insurer Fairfax Financial Holdings Ltd (FFH.TO), joined RIM's board in January as part of management changes that saw Thorsten Heins replace longtime co-CEOs Jim Balsillie and Mike Lazaridis.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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