Slumping health care stocks dragged the TSX lower on Friday, while U.S. markets recorded gains. The S&P/TSX Composite Index fell 26.19 points to close at 7783.59. It ended up 0.4% on the week.

Market momentum was negative as 576 issues advanced and 640 declined.

The TSX health care index lost a whopping 5% as Biovail shares plunged $5.70, or 19%, to $24.60 on word the Securities and Exchange Commission was conducting an informal inquiry into the company’s accounting and financial practices.

Angiotech Pharmaceuticals also took a beating, falling 1.2%, or 75¢, to $61.49 on profit-taking after a U.S. advisory panel urged regulators to approve Boston Scientific Corp.’s coronary stent, a medical device that uses a drug coating developed by Angiotech.

Financials issues however rose 0.44%, while golds moved 0.07% higher.

Manulife Financial shares gained $1.08 to $40.23.

Barrick Gold shares rose 20¢ to $28.20 after the gold giant confirmed it would wind up its hedging program, a move seen as being bullish for gold prices.

Gold futures rose US$2.30 to US$396 an ounce.

Air Canada gained 10¢ to 98¢. Cerberus Capital Management is mounting a second try at securing an equity stake in the airline, having lost out to Victor Li’s Trinity Time Investments bid. Air Canada management has repeatedly warned that its shares will be worthless once its restructuring is completed.

CP Rail shares fell $2.18 to $35.10. The railway said it would make a voluntary $300-million payment to the company’s pension plan. It also said it was aiming for a 20% increase in earnings in 2004.

The junior S&P/TSX Venture composite index slipped 2.43 points to close at 1,612.18.

On Wall Street, technology stocks rose, but gains among blue-chip were smaller as pharmaceutical giant Merck & Co. scrapped its second experimental medicine in 10 days.

The tech-heavy Nasdaq composite index closed up 11.96 points at 1,893.88, while the broad S&P 500 index climbed 1.63 points, to 1,035.28. The blue-chip Dow Jones industrial average rose 9.11 points to 9,628.53.

However, for the second week in a row the major stock indexes ended lower. The Dow and S&P 500 fell 1.4 % , while the Nasdaq fell 1.9%.

The Canadian dollar fell 0.04 of a cent to close at US76.78¢.
The loonie lost ground after Bank of Canada Governor David Dodge gave the clearest signal yet that the bank would cut interest rates if it thought the Canadian dollar’s strength was likely to damage the domestic economy.