Market hits two-month closing low on energy sector

Thu Nov 8, 2012 4:50pm EST
 
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By John Tilak

TORONTO (Reuters) - Canada's main stock index finished at its lowest close in more than two months on Thursday, as shares of Canadian Natural Resources Ltd CNQ.TO slumped after the oil and gas producer cut its output forecast, dragging on the energy sector.

Shares reversed earlier gains in a bumpy session as investors sifted through U.S. jobs data that indicated improvement in the labor market and as the European Central Bank left interest rates unchanged. <MKTS/GLOB>

Investors also continued to worries over whether the United States will reach a compromise to address its budget deficit and avert a "fiscal cliff" of $600 billion in scheduled tax increases and spending cuts beginning in January, which is seen threatening the country's economic recovery .

"We have a gridlock. The market is saying, 'Show us something. Show us that you can resolve the problems that are out there,'" said Levente Mady, senior portfolio manager at PI Financial Corp.

The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE ended down 39.54 points, or 0.32 percent, at 12,191.05, its lowest close in more than two months. Earlier it hit an intraday low of 12,164.11, its softest level since October 23.

Eight of the index's 10 main sectors ended in negative territory. Energy and financial shares led the decline, falling 1.2 percent and 0.6 percent, respectively.

Shares of Canadian Natural Resources fell 3.2 percent to C$28.02 after the country's biggest independent oil and gas producer reported a 57 percent fall in quarterly profit and cut its full-year forecast for crude oil and natural gas liquids output. It played the biggest role of any single stock in leading the market lower.

Some of Canada's major banks also dragged on the index. Royal Bank of Canada RY.TO, the country's biggest bank, fell 1.1 percent to C$55.72, and Toronto Dominion Bank TD.TO lost 0.9 percent to C$80.30.   Continued...

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