TSX stumbles to two-month low on U.S., Europe fears

Tue Nov 13, 2012 5:03pm EST
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By John Tilak

TORONTO (Reuters) - Canada's main stock index slipped to a two-month low on Tuesday, dragged down by resource and financial shares as investors dwelled on fears of a fiscal crisis in the United States and more debt turmoil in Europe.

Concern over whether U.S. politicians would be able to reach a deal to tackle the "fiscal cliff" of spending cuts and tax increases that threatens to push the economy into recession continued to dampen sentiment, as did a new controversy over Greece's debt crisis. <MKTS/GLOB>

"The main thing hanging over the market right now is the fear of what's happening in the macroeconomy, whether it's Europe or the fiscal cliff in the United States or slower activity in China," said Michael Sprung, president of Sprung Investment Management.

"All this feeds into the Canadian market through worries about what's going to happen to energy prices or commodity prices."

Oil prices fell for a second day in a row on concerns about lower demand. <O/R>

Suncor Energy (SU.TO: Quote) was the biggest contributor to the index's decline, falling 2.5 percent to C$32.55. The energy sector, one of the biggest on the index, was down 0.7 percent.

The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE ended down 56.80 points, or 0.47 percent, at 12,134.66. Earlier in the session it fell as low as 12,124.35, its weakest level since September 6.

The materials sector, which includes mining stocks, fell 0.9 percent, hurt by falling commodity prices.   Continued...

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