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Roundup: Canadian stock market loses ground on resources, telecom selloffs

Xinhua, December 18, 2015 Adjust font size:

Canada's main stock market in Toronto Thursday dropped sharply after a two-day rally as selloffs in resources and telecom shares weighed.

The Toronto Stock Exchange's benchmark Standard & Poor's/ TSX Composite Index lost 156.15 points, or 1.19 percent, to 13,009.93 points, with five of the eight most weighed sectors in the negative territory.

The index was dragged lower since the opening in Thursday morning as most commodities prices were hit hard after the U.S. Federal Reserve raised interest rates on Wednesday.

The most active gold contract for February delivery lost 27.2 U.S. dollars, or 2.54 percent, to close at 1,049.60 dollars per ounce, while the light, sweet crude oil for January delivery moved down 0.57 U.S. dollar to settle at 34.95 dollars a barrel on the New York Mercantile Exchange on Thursday.

The gold giants Barrick Gold Corporation declined 7.98 percent to 9.69 Canadian dollars (about 6.95 U.S. dollars) and Goldcorp Inc. dropped 6.61 percent to 15.26 Canadian dollars per share.

The oil and gas provider Encana Corporation lost 4.79 percent to 6.96 Canadian dollars.

Meanwhile, Telecom also shrank 3.17 percent. Shaw Communications Inc. said on Wednesday after the closing bell that it has agreed to buy Wind Mobile, the country's fourth-largest wireless provider, for an enterprise value of approximately 1.6 billion Canadian dollars, which aims tp enhance Shaw's product offering by expanding mobile service capabilities.

Shaw lost 7.68 percent to 24.9 Canadian dollars in its stock price.

However, industrials and utilities managed to increase slightly by 0.35 percent and 0.3 percent respectively.

Analysts believed the Canadian economy is weak in 2015, and only a modest recovery is expected in 2016 and 2017, when the oil prices are continuously falling. "Relatively weak oil prices in the near term will continue to place downward pressure on business investment, which is not likely to grow until 2017," according to a long-term economic forecast issued by TD Economics on Thursday.

Weighed by a stronger U.S. dollar, the Canadian dollar Thursday dived to 0.7168 U.S. dollar at 4 pm local time, hit the lowest level against the greenback for the first time since the spring of 2004. Enditem