BUSINESS
02/13/2012 08:27 EST | Updated 04/14/2012 05:12 EDT

TSX slightly higher, traders cautious as Greece approves measures to get bailout

TORONTO - The Toronto stock market closed little changed Monday as news that the Greek parliament passed a package of austerity measures to secure a another bailout was tempered by questions about when Greece would actually get the money.

The S&P/TSX composite index finished the session up 9.27 points at 12,398.69 as gold stocks moved into the red. The TSX Venture Exchange fell 4.15 points to 1,649.4.

The Canadian dollar also drifted lower from the highs of the day as early gains in copper and gold prices evaporated. The loonie was up 0.35 of a cent at 100.07 cents US.

U.S. markets were higher as the Dow industrials gained 72.81 points to 12,874.04. The Nasdaq composite index climbed 27.51 points to 2,931.39 and the S&P 500 index was up 9.13 points to 1,351.77.

Greece's fellow eurozone members had demanded drastic cuts in civil service jobs, minimum wages and welfare to secure the euro130-billion bailout package needed to stave off bankruptcy.

Without the bailout and a related bond swap deal with private creditors, Greece will be pushed into a disorderly default on bond repayments next month, leading to a collapse of the country's financial sector and destabilization of the wider European and global markets.

Between now and the looming Greek bond repayment on March 20, there is also the risk that some private creditors may resist the deal to swap their bonds for new ones with a lower value.

A spokeswoman for Germany's finance ministry said Monday the final approval of a new bailout won't be given until early March. That means the eurozone will have to split the final bailout approval from a related debt relief deal that will take several weeks to implement and has to be finalized ahead of the March 20 bond repayment.

"The truth is there is still a lot of work that needs to be done between now and Mar. 20.," said Norman Raschkowan, North American strategist Mackenzie Financial Corp.

"The essence of the hard line that European countries have taken with Greece, is that in their minds, Greece has made promises and not kept them."

The tech sector was the biggest percentage advancer in Toronto, up 0.88 per cent as Celestica Inc. (TSX:CLS) gained 26 cents to $8.97 while Research In Motion Ltd. (TSX:RIM) dropped 55 cents to $14.91.

The industrials sector was ahead 0.49 per cent. Bombardier Aerospace (TSX:BBD.B) has received an order for five Q400 NextGen aircraft from an unnamed carrier valued at US$160 million. Bombardier shares rose six cents to $4.85.

Relief over the Greek austerity vote had earlier extended to commodity markets, but copper and gold prices lost early gains.

The energy sector improved by 0.45 per cent while the March crude contract on the New York Mercantile Exchange gained $2.24 to US$100.91 a barrel. Talisman Energy (TSX:TLM) rose 25 cents to $12.56 and Canadian Oil Sands (TSX:COS) was ahead 59 cents to $22.59.

The gold sector was the biggest weight, down about 0.5 per cent as April bullion gave up early gains and dipped 40 cents to US$1,724.90 an ounce. Kinross Gold Corp. (TSX:K) declined 35 cents to $10.44.

Russian gold miner Highland Gold Mining Ltd. said that Barrick Gold Corp. (TSX:ABX) plans to sell its 20.4 per cent stake in the company. Based on the company's share price Monday, Barrick's stake was worth about $170 million. On the TSX, Barrick shares fell 28 cents to $47.97.

Avion Gold Corp. (TSX:AVR) has started production at its new underground mine at the Tabakoto gold deposit in Mali, West Africa, with average production anticipated to be about 470,000 tonnes of ore for the year. Its shares dipped one cent at $1.47.

The base metals component was flat with March copper down two cents to US$3.84 a pound. Teck Resources (TSX:TCK.B) was down 94 cents to $39.30 while Ivanhoe Mines (TSX:IVN) gained 14 cents to $16.63.

Elsewhere on the corporate front, London-based Vodafone Group PLC, the world's largest mobile phone company, said Monday it is considering a possible bid for Cable & Wireless Worldwide PLC. Vodafone said it was "in the very early stages of evaluating the merits of a potential offer for CWW."

The Sunday Times suggested that Vodafone might offer 700 million pounds for Cable & Wireless, which had a market value of nearly 550 million pounds based on Friday's closing price.

Valeant Pharmaceuticals International Inc. (TSX:VRX) is buying Eyetech Inc., a private company involved in the treatment of age-related macular degeneration. The value of the agreement was not disclosed and Valeant shares rose 32 cents to $48.43.