June 26 (Reuters) - Canada's main stock index fell on Friday, dragged down by the energy sector as concerns about rising coronavirus cases in the United States and China dented hopes for fuel demand recovery.
* Fears linger that a spike in COVID-19 infections in southern U.S. states could stall the demand recovery, as they are among the biggest gasoline consumers.
* The energy sector dropped 1.1% as U.S. crude prices fell 0.4% a barrel, however Brent crude added 0.2%.
* At 9:39 a.m. ET (13:39 GMT), the Toronto Stock Exchange's S&P/TSX composite index was down 69.57 points, or 0.45%, at 15,376.57.
* The financials sector slipped 1%, while the industrials sector rose 0.1%.
* The materials sector, which includes precious and base metals miners and fertilizer companies, lost 0.3% even though gold futures rose 0.2% to $1,764.7 an ounce.
* On the TSX, 53 issues were higher, while 162 issues declined for a 3.06-to-1 ratio in favor of the losers, with 12.04 million shares traded.
* The largest percentage gainer on the TSX was SEMAFO Inc , which jumped 1.5% after Endeavour Mining Corp received clearance for its acquisition of SEMAFO.
* It was followed by BRP Inc, which rose 1.5%.
* Corus Entertainment Inc fell 8.6%, the most on the TSX, after the company missed Q3 earnings, followed by Knight Therapeutics Inc, which lost 3.6% after the pharma company reported disappointing Q1 results.
* The most heavily traded shares by volume were Freegold Ventures Ltd, down 8%; Nutrien Ltd, down 0.7% and Canadian Imperial Bank of Commerce, down 1.1%.
* The TSX posted one new 52-week high and no new low.
* Across all Canadian issues, there were seven new 52-week highs and one new low, with total volume of 25.81 million shares. (Reporting by Amal S in Bengaluru; Editing by Vinay Dwivedi)
US STOCKS-Wall St falls as Fed action hits bank stocks, virus cases surge
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* Nike falls after surprise quarterly loss
* U.S. lenders slip as Fed caps shareholder payout
* Gap jumps after tie up with Kanye West
* Indexes fall: Dow 2.07%, S&P 1.77%, Nasdaq 1.94% (Adds quote, details; updates prices)
By Medha Singh and Devik Jain
June 26 (Reuters) - Wall Street's major indexes dropped on Friday as the United States set a new record for a one-day increase in coronavirus cases and bank stocks tumbled after the Federal Reserve decided to cap shareholder payouts.
The S&P 500 banks sub-index declined 5% after the Fed limited dividend payments and barred share repurchases until at least the fourth quarter following its annual stress test.
In the previous session, banks stocks had powered Wall Street's main indexes higher, helping them offset investor fears due to rising virus infections in several U.S. states, including Texas, Oregon and Utah.
Cases rose across the United States by at least 39,818 on Thursday. Texas, which has been at the forefront of easing restrictions, paused its reopening plans after the state recorded its one of the biggest jumps in new infections.
"States are rethinking the reopening and that's going to affect a lot of businesses," said David Yepez, lead equity analyst and portfolio manager at Exencial Wealth Advisors in Oklahoma.
"We're not going to test those March lows but there could be a correction, because we got a little bit too high."
The uptick in cases has also threatened to derail a strong rally for Wall Street that brought the S&P 500 within 10.7% of its February all-time high on the back of record government stimulus measures.
The benchmark index was also testing its the 200-day moving average, an indicator of long-term momentum. If it closes below the key level, it could signal further losses.
At 11:02 a.m. ET, the Dow Jones Industrial Average was down 532.55 points, or 2.07%, at 25,213.05, the S&P 500 was down 54.56 points, or 1.77%, at 3,029.20. The Nasdaq Composite was down 194.40 points, or 1.94%, at 9,822.61.
Nike Inc dropped 5.8% as the footwear maker posted reported a surprise quarterly loss hurt by store closures due to the pandemic.
Facebook Inc shed 6.4% after Verizon Communications Inc joined an advertising boycott that called out the social media giant for not doing enough to stop hate speech on its platforms.
Gap Inc surged 31.4% after it entered into a 10-year deal with rapper and fashion designer Kanye West to create a Yeezy line of clothing.
Data showed U.S. consumer spending rebounded by the most on record in May, but the gains are not likely to be sustainable, as income declined and expected to fall further as millions lose their unemployment checks starting next month.
Friday also marks the reconstitution of the FTSE Russell indexes, including large cap Russell 1000 and small cap Russell 2000, that often marks one of the biggest trading volume days of the year.
Declining issues outnumbered advancers for a 6.40-to-1 ratio on the NYSE and for a 5.92-to-1 ratio on the Nasdaq.
The S&P index recorded five new 52-week highs and no new low, while the Nasdaq recorded 39 new highs and 13 new lows. (Reporting by Devik Jain and Medha Singh in Bengaluru; Editing by Arun Koyyur)