TSX logs biggest one-day drop in two months

Thu May 3, 2012 5:36pm EDT
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

By Jon Cook

TORONTO (Reuters) - Toronto's main stock index suffered its largest single-day drop in nearly two months on Thursday as mining and energy shares slid after weak U.S. services-sector data raised concerns about the economic recovery of Canada's largest trading partner.

All 10 of the index's main sectors were lower. The heavily weighted materials group led losses, falling nearly 3 percent as gold mining shares tumbled alongside bullion prices. <GOL/>

Barrick Gold Corp (ABX.TO: Quote), the world's top gold producer, fell 3.3 percent to C$37.52 and Goldcorp Inc (G.TO: Quote), the country's second-largest producer, lost more than 4 percent to C35.95.

"That takes a big bite out of the index because the gold sector has a substantial weighting," said Fred Ketchen, director of equity trading at ScotiaMcLeod.

Oil and gas companies' shares slipped between 2 percent and 3 percent as U.S. crude prices fell more than $2 a barrel. <O/R> Suncor Energy (SU.TO: Quote) slid 2.8 percent to C$31.32, and Cenovus Energy (CVE.TO: Quote) dropped 1.9 percent to C$33.95.

The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE plunged 215.22 points, or 1.76 percent, to 12,014.90, its biggest one-day drop since March 6.

The TSX accelerated losses after Thursday's report by the Institute for Supply Management revealed the pace of growth in the vast U.S. services sector slowed more than expected in April. It followed Wednesday's ADP data that revealed U.S. private-sector employment slowed last month.

The ISM number countered earlier data on Thursday that showed U.S. jobless claims fell more than expected last week, giving mixed signals ahead of Friday's key U.S. non-farm payrolls report for April.   Continued...

A Toronto Stock Exchange (TSX) logo is seen in Toronto November 9, 2007. REUTERS/Mark Blinch