By Derek Abma
CanWest News Service
The Province
Thursday, September 06, 2007

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The Toronto Stock Exchange's benchmark index fell yesterday for the first time in three days as concerns about economic growth in the U.S. and globally weighed on investors' minds.

Adrian Mastracci, fee-only portfolio manager at KCM Wealth Management in Vancouver, says, "It's just a whole number of things. .... People are starting to use the R-word, as in recession, more and more.

The S&P/TSX composite index was down 71.95 points, or 0.5 per cent, to 13,683.28. The Venture composite index fell 30.26 points, or 1.1 per cent, to 2,645.02.

Adrian Mastracci, portfolio manager with KCM Wealth Management Inc. in Vancouver, said a report from the Organization for Economic Co-operation and Development and the U.S. Federal Reserve "beige book" of economic conditions showed Canada's main export markets might see limited growth in the near term, and this had a broad-based effect on stocks.

"It's just a whole number of things. .... People are starting to use the R-word, as in recession, more and more," Mastracci said. "There's just a lot of moving parts right now, and they all seem to be moving in the wrong direction."

The worst-hit industry sectors on the TSX were mining, technology and industrials.

The metals-and-mining index sank 1.7 per cent. Teck Cominco Ltd. was down $1.19, or 2.7 per cent, to $43.55. First Quantum Minerals Ltd. was down $2.24, or 2.8 per cent, to $78.83.

The information-technology index was the second-biggest decliner, falling 1.4 per cent. Research In Motion Ltd. stock lost $1.98, or 2.2 per cent, to $87.54. Nortel Networks Corp. shares fell by an equal percentage, or 42 cents, to $18.26.

Industrials, often seen as a measure for overall economic growth, saw its TSX index fall 1.3 per cent. This was pulled down by a decline in Canadian Pacific Railway Ltd. stock of $2.54, or 3.5 per cent, to $70.93. CP Rail announced yesterday it is buying Dakota, Minnesota & Eastern Railroad Corp. for $1.5 billion U.S. The stock of fellow rail operator Canadian National Railway Corp. was virtually flat, up one cent to $55.70.

The only TSX industry index in positive territory was energy - barely at

0.1 per cent. Perhaps saving this sector from the broad stock decline was a

65-cent rise in the price of crude oil to $75.73 U.S. a barrel in New York. Canadian Oil Sands Trust was up 54 cents, or 1.8 per cent, to $31.32. Imperial Oil Ltd., however, saw its stock decline 30 cents, or 0.6 per cent, to $46.78.

The TSX materials index was down 0.7 per cent. The biggest gold companies on this index declined moderately. Barrick Gold Corp. was down 5 cents, or 0.1 per cent, to $35.04. Goldcorp Inc. fell 7 cents, or 0.3 per cent, to $25.25. The price of gold fell 80 cents to $690.70 US an ounce.

The Canadian dollar declined 37 basis points to 94.92 cents U.S.

In the U.S., stocks fell after reports showed the housing slump was deepening and spreading to the job market while slowing consumer spending.

Investor concerns about the health of the consumer were exacerbated when Costco Wholesale Corp. reported sales for August that fell short of expectations and Apple Inc. announced big price cuts on its new iPhones in an effort to spur sales.

Retail and technology shares fell broadly, with the Nasdaq snapping a four-session winning streak.

The Dow Jones industrial average was down 143.39 points, or 1.07 per cent, at 13,305.47. The Standard & Poor's 500 index was down 17.13 points, or 1.15 per cent, at 1,472.29. The Nasdaq composite index was down 24.29 points, or 0.92 per cent, at 2,605.95.

Evidence of possible trouble for the economy came from reports showing pending sales of previously owned homes plunged by a record 12.2 per cent in July and that private employers hired the fewest workers in more than four years in August.

Citigroup Inc. fell 2.6 per cent to $46 and was the top drag on the S&P 500 index after The Wall Street Journal said Citigroup and other banks could face financial exposure because of affiliated investment units that have issued short-term debt.

Apple shares slid 5.1 per cent to $136.76 and were the top drag on the Nasdaq and second-biggest weight on the S&P. Investors had pushed the stock up 17 per cent in the two weeks leading up to the announcement. Shares of AT&T, the iPhone service provider, fell 1.4 per cent to $39.73.

Shares of Costco slid after it reported sales at stores open at least a year were well below analyst expectations in August. Costco shares were down 4.2 per cent to $59 on the Nasdaq.

NOTE: The information provided above is intended for general informational purposes only. It does not constitute advice for anyone's specific situation. Everyone should always first consult directly with their advisors to determine the appropriateness of any information contained above before taking any action. KCM Wealth Management Inc. assumes no responsibility for any loss or damage arising from the use of, or reliance upon the above information.