TSX drops as China data fuels resources dip
By John Tilak
TORONTO (Reuters) - Canada's main stock index declined on Monday after sluggish Chinese economic data hurt commodity prices and dampened enthusiasm for shares of materials and energy companies.
China's factory output growth was surprisingly feeble in April and fixed-asset investment slowed, rekindling concerns that the recovery is stalling.
The resource-heavy Toronto market is sensitive to developments in China, a big consumer of commodities from Canada, because of its large exposure to materials and energy stocks.
An unexpected rise in U.S. retail sales in April failed to lift sentiment.
"Any hint of weakness in China does not help export-focused markets like Canada and Australia," said Matt Skipp, president of SW8 Asset Management.
"Before committing any money on the long side at the moment, I want to see what this very significant commodity weakness is telling us about the global economy," he added.
The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE closed down 59.54 points, or 0.47 percent, at 12,529.55.
"There's a tremendous amount of nervousness in the markets," said Sal Masionis, a stockbroker at Brant Securities. Continued...