TORONTO - The Toronto stock market was lower late Friday morning as oil prices slipped on a sign of decreased demand. The S&P/TSX composite index declined 52.9 points to 10,661.3. The energy sector moved down one per cent as the July crude contract on the New York Mercantile Exchange came off a seven-month high to slip 67 cents to US$72.01 a barrel. The dip came as the Organization of the Petroleum Exporting Countries forecast Friday that demand for its crude this year would average 28.6 million barrels a day - 2.2 million barrels less than in 2008. EnCana Corp. (TSX:ECA) fell 87 cents to C$62.12. BlackWatch Energy Services Corp. (TSX:BWT) shares jumped 26 cents or 49 per cent to 79 cents after the oilfield services company announced a recapitalization plan and named a new management team on Thursday. The TSX is headed for a fourth straight weekly gain as a powerful spring rally into its fourth week continues to chug along on hopes for an economic recovery by the end of the year. However, investor sentiment has been weighed down this week by rising U.S. Treasury yields that have raised worries about higher interest rates and inflation. The TSX Venture Exchange added 1.45 points to 1,149.77 while a stronger U.S. dollar sent the Canadian dollar down 1.08 cents to 89.57 cents US. New York markets were flat at the end of a tepid week, failing to get a boost from data showing that U.S. consumer confidence continued to climb in June. The Dow Jones industrial average moved 8.2 points lower to 8,762.7. The Nasdaq composite index declined 21.1 points to 1,841.27 while the S&P 500 index was off 4.1 points to 940.8. The University of Michigan's consumer sentiment index edged up 0.3 of a point to a nine-month high of 69.0, which was slightly below expectations. Also, while the current conditions component gained, expectations fell for the first time since February. Gains on stock markets have been spotty this week as investors wonder if a pause is in order after the TSX ran up 40 per cent since the March 9 lows. The S&P has gained 39 per cent and the Dow has jumped 34 per cent since the market bottomed in early March. Joe Clark, managing partner of Financial Enhancement Group in New York, compared the market to a sponge - during the recent run-up in prices, investors absorbed all the good news they could take in to push stocks higher. Eventually the market becomes saturated and can't absorb any more information, he said. "The sponge seems to be full," Clark said. Rising bond yields have been a worry this week as investors became concerned that rising interest rates and weakening demand for U.S. government debt could derail a potential recovery in the economy. If Washington has to raise rates to attract buyers, that could hurt the economy by boosting borrowing costs for consumers. But Thursday's bond auction results helped eased some of those concerns as demand for the debt appeared strong and bond yields declined with the yield on the benchmark 10-year Treasury note, which moves opposite its price, falling to 3.79 per cent from 3.86 per cent late Thursday. The Toronto market also came under pressure from declines in the high-flying base metals sector, which had rocketed up 150 per cent since early March. It was off 0.6 per cent Friday as the July copper contract in New York shed six cents to US$2.39 a pound with 1st Quantum Minerals (TSX:FM) down $1.91 to $57.13. The gold sector faded 1.66 per cent as the August bullion contract moved down $19.40 to US$942.60 an ounce. Goldcorp Inc. (TSX:G) dropped 72 cents to C$39.26. Centerra Gold Inc. (TSX:CG) shares faded 50 cents to $6.80 after it said its operating licence for the Boroo Mine in Mongolia has been suspended for up to three months after a report from a government inspection agency that visited the Boroo minesite. Positive sectors included the industrial and utility sectors, both up about one per cent. In other corporate news, British bank Barclays reported that it has sold its Global Investment unit to U.S. fund manager BlackRock Inc. for US$13.5 billion. Drug maker Patheon Inc. (TSX:PTI) reported Friday a profit of US$500,000 profit, reversing a year-ago loss of $8-million as its restructuring and cost-cutting program continued. Its shares dipped a penny to $2.79. Overseas, Japan's Nikkei stock average rose 1.6 per cent, while Hong Kong's Hang Seng gained 0.5 per cent. Asian markets were buoyed by reports that retail sales and industrial output grew strongly in China in May. Britain's FTSE 100 fell 0.25 per cent, Germany's DAX index declined 0.55per cent, and France's CAC-40 fell 0.3 per cent.

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