TSX tumbles as ECB joins Fed on sidelines

Thu Aug 2, 2012 5:07pm EDT
 
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By Jon Cook

TORONTO (Reuters) - Canadian stocks fell for a fourth straight day on Thursday, led by energy and financial shares, as the European Central Bank followed the U.S. Federal Reserve in pouring cold water on expectations of further stimulus to boost the global economy.

After last week's pledge by ECB President Mario Draghi to "do whatever it takes" to save the euro, expectations for strong action had been running high.

"The market was expecting something a bit more dramatic today," said Craig Fehr, Canadian market strategist at Edward Jones in St. Louis, Missouri. "It has grown a little weary of the talk and is looking for action at this point."

The Fed took a similar wait-and-see approach on Wednesday and did not announce any new stimulus measures to help revive a flagging U.S. recovery.

Canada's heavily weighted energy sector fell 2 percent, hut by lower oil prices and by weak earnings results from Enbridge Inc (ENB.TO: Quote) and Petrominerales Ltd PMG.TO.

Enbridge slid 1.5 percent to C$39.90 after the pipeline operator reported a sharp fall in second-quarter profit due to losses on financial derivatives.

Petrominerales Ltd PMG.TO shares plummeted more than 18 percent to C$7.53 after the oil and gas producer's second-quarter adjusted profit fell 66 percent on lower oil prices and sales.

Canadian financials slid 0.8 percent after the ECB news. Losses were led by top lenders Bank of Nova Scotia (BNS.TO: Quote), down 1.2 percent at C$51.36, Toronto-Dominion Bank (TD.TO: Quote), which fell 0.9 percent to C$77.99 and Bank of Montreal (BMO.TO: Quote), off 1.1 percent at C$56.82.   Continued...

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