U.S. stocks fall on Egyptian turmoil

Turmoil in Egypt roiled North American stock markets Friday, sending oil and gold higher and dragging U.S. stocks down.

The S&P/TSX composite index — heavily weighted in oil and gold mining stocks — gained 27 points, or 0.2 per cent, to 13,437 when the TSX closed on Friday.

The Dow Jones industrial average fell 166 points, or 1.4 per cent, to 11,823.

The S&P 500 fell 23 points, or 1.9 per cent, to 1,276. The Nasdaq composite fell 68 points, or 2.5 per cent, to 2,687.

Anti-government protests in Egypt grew Friday and President Hosni Mubarak imposed a nationwide curfew.

Anxious traders pulled money from other assets to buy oil, gold and the U.S. dollar, which are considered safer risks during uncertain times.

The March crude contract on the New York Mercantile Exchange jumped $3.70 US to $89.34 US a barrel while the February gold contract rose $22.30 US to $1,340.70 an ounce.

The Suez Canal is a significant shipment route for oil, with a million barrels a day moving northbound to Europe and other developed economies through the route. Almost as much  travels in the other direction.

The S&P/TSX energy index rose more than two per cent and its global gold index gained almost three per cent.

The Canadian dollar was down 0.80 of a cent to 99.88 cents US, as investors sought safety in the U.S. currency going into the weekend.

"This is definitely a flight into safety," said Rich Ilczyszyn, a senior market strategist with futures brokers Lind-Waldock.

"Traders are watching this flare-up in the Middle East and using it as a reason to take profits," said Doug Godine, managing director at Signal Hill, an investment bank.

Investors also sold after a report showed that the U.S. economy isn't growing as quickly as economists expected.

The U.S. Commerce Department said American gross domestic product grew at an annual rate of 3.2 per cent between October and December, below the 3.5 per cent that analysts had forecast.

Analysts had worried that the rapid rise in markets was making them vulnerable to a correction. The Dow has gained 83 per cent from its 12-year low reached on March 9, 2009 and the TSX is up over 20 per cent since the lows of last July without a significant setback.