TORONTO - Weakness in bank and insurance stocks kept the Toronto stock market in the red Wednesday morning. The S&P/TSX composite index was down 48.9 points to 11,056.4 after rising 88 points Tuesday to its highest close this year. The financial sector lost 0.8 per cent, continuing a deterioration in the sector since the major banks turned in earnings late last month. "I think what you're seeing basically is just general profit-taking from some of these financials," said Eric Brass, equity analyst at MFC Global Investment Management. "Some of these stocks are up over 100 per cent since their lows, so I think people are just taking their money off the table to a degree. The earnings were quite good for the financials - five out of the six major banks beat expectations." Scotiabank (TSX:BNS) lost 76 cents to $44.07. The TSX energy sector was ahead 0.46 per cent as a weak American dollar continued to send commodity prices higher. The October crude contract on the New York Mercantile Exchange rose $1.13 to US$72.23 a barrel after charging ahead just over US$3 on Tuesday. Oil traders are closely watching an OPEC meeting in Vienna, although oil ministers have repeatedly said the producer group is unlikely to change its production levels. American currency weakness also pushed the Canadian dollar up for a fourth day in a row, up 0.35 cent to 92.99 cents US. Three days of gains have pushed the loonie more than two U.S. cents higher. Many observers expect the Canadian dollar to remain strong, with a TD Economics report Tuesday predicting a return to parity with the U.S. greenback by the end of the year. The latest move up comes a day before the Bank of Canada makes its scheduled announcement on interest rates. While the central bank is widely expected to leave rates unchanged at 0.25 per cent. But it is expected to address the sharply appreciating currency, following up previous comments that the high loonie could derail an economic recovery. The TSX Venture Exchange rose 1.16 points to 1,242.22. New York markets were higher on top of modest gains Tuesday as the Dow Jones industrial average moved up 34.5 points to 9,531.8. The Nasdaq composite index was ahead 15.88 points to 2,053.65 while the S&P 500 index rose 4.85 points to 1,030.25. Later in the session, investors will get a snapshot of U.S. business conditions from the Federal Reserve. The Fed's report, known as the beige book, tracks economic activity by region and is due at 2 p.m. EDT. On the economic calendar, Canada Mortgage and Housing Corp. said the annual rate of housing starts increased to 150,400 units in August from 134,200 in July. Canada Mortgage and Housing Corp. says there were improvements in both the single-and multiple-housing segments. The TSX gold sector was off 0.4 per cent as the December bullion contract on the New York Mercantile Exchange moved $1.10 higher to US$1,000.90 an ounce. Barrick Gold Corp. (TSX:ABX), the world's biggest gold company, has announced plans to eliminate all of its gold hedges and raise US$3.5 billion in an offering of shares to help pay for the move. The company said it made the decision because of an increasingly positive outlook on the gold price. Its shares were down $1.90 to $40.55. December copper dropped four cents at US$2.92 a pound and the base metals sector was up 1.14 per cent. Inmet Mining Corp. (TSX:IMN) shares slipped 53 cents to $54.74 as it denied a report in a Korean newspaper that Korea Resources Corp. is planning to buy a stake in the Canadian company. Elsewhere in the sector, shares in London-based Katanga Mining Ltd. (TSX:KAT) surged 13 cents or 16.88 per cent to 90 cents after it said it plans to accelerate the ramp-up of its copper-cobalt project in the Democratic Republic of Congo because of the recovery in prices. In other corporate news, Canada's largest sporting goods retailer cited the recession, poor summer weather, the restructuring of some of its stores and the distraction of a proxy fight for dismal returns in the second-quarter of fiscal 2010. The Forzani Group Ltd. (TSX:FGL) suffered a loss of $4.4 million or 14 cents a share in the quarter. Forzani shares were down 76 cents to $13.54. The Alberta Securities Commission will hold a hearing Wednesday to deal with a second request by TransAlta Corp. (TSX:TA), which wants to dismantle the takeover defence put in place Canadian Hydro Developers Inc. (TSX:KHD). TransAlta's hostile $654-million offer for the Calgary-based green energy producer is set to expire on Friday. TransAlta shares advanced 10 cents to $20.99 while Canadian Hydro Developers declined 12 cents at $4.96. Viterra Inc. (TSX:VT) shares lost eight cents to $9.25 as Canada's largest grain handling company came a step closer to finalizing a C$1.4-billion takeover of Australia's ABB Grain (ASX:ABB). ABB Grain's shareholders have voted in favour of Viterra's acquisition with 60.45 per cent of the shareholders with 83.57 per cent of shares supporting the transaction. Sources say General Motors' board of directors is reviewing four outcomes as it debates the future of its German-based Opel unit, including the possibility of keeping the company or letting it slide into bankruptcy protection. The board, meeting in Detroit Wednesday, is also discussing whether it should accept bids from a consortium of Magna International Inc. (TSX:MG.A) and Russia's Sberbank or a competing offer from RHJ International, a Brussels-based investment house. Magna shares were ahead 20 cents to $46. In overseas trading, Tokyo's Nikkei 225 stock average closed down 0.8 per cent while in Hong Kong, the Hang Seng declined one per cent and China's benchmark Shanghai index recovered losses to gain 0.5 per cent. London's FTSE 100 index added 0.89 per cent, Frankfurt's DAX gained 1.3 per cent while the Paris CAC 40 was up 0.93 per cent.

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