CANADA STOCKS-TSX steady as investors eye U.S. debt deal talks

Reuters

* TSX rises 1.36 points, or 0.01 percent, to 12,895.77

* Six of 10 main sectors advance

* Potash slips after cut in profit forecast

* Barrick, Goldcorp weigh the most on market

By John Tilak

TORONTO, Oct 11 (Reuters) - Canada's main stock index was

little changed on Friday with investors closely watching whether

U.S. lawmakers would reach an agreement soon to end a U.S.

government shutdown and to raise its borrowing limit.

A drop in gold producers and a decline in Potash Corp of

Saskatchewan Inc, after the fertilizer giant cut its

profit forecast for the third quarter, weighed on the market.

After recording its biggest jump in three months in the

previous session, nervousness returned to the Toronto market as

the U.S. budget impasse dragged on.

President Barack Obama is expected to press his case for a

quick reopening of the entire federal government coupled with an

emergency increase of U.S. borrowing authority when he meets

with Senate Republicans. Failure to raise the

borrowing limit would have serious repercussions for the fiscal

standing of the United States, the world's biggest economy, and

for markets and economies of the U.S. and other world nations.

Investors hesitated to make calls until there was certainty

about a resolution to the crisis.

"We're certainly sitting on the sidelines," said David

Cockfield, managing director and portfolio manager at Northland

Wealth Management. "I just keep my head down for the moment."

"I want to see some actual results before I make up my mind

how this is going to turn out," he added. "I don't think it's

over until it's over."

The Toronto Stock Exchange's S&P/TSX composite index

was up 1.36 points, or 0.01 percent, at 12,895.77.

Cockfield still expects the crisis will be resolved soon,

and the Canadian benchmark index will make some gains between

now and the end of the year.

Six of the 10 main sectors on the index were higher Friday.

The financial sector gained 0.4 percent, with Royal Bank of

Canada climbing 0.5 percent to C$68.05.

Energy shares added 0.4 percent, with Suncor Energy Inc

rising 0.2 percent to C$36.96.

But weakness in the price of bullion weighed on the

materials sector, which includes mining stocks.

Gold producers fell more than 2 percent. Barrick Gold Corp

shed 3 percent to C$17.98, and Goldcorp Inc fell

2 percent to C$24.75. The two stocks had the biggest negative

influence on the market.

Potash Corp was down 1.6 percent at C$32.46 after it

estimated quarterly profit would be below market expectations as

its customers delayed purchases amid market uncertainty.

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