TSX stumbles as investors hit pause button
By John Tilak
TORONTO (Reuters) - Canada's main stock index fell on Tuesday, with a decline in industrials offsetting stronger resource shares, as investors worried about the U.S. Federal Reserve's stimulus plans and feared a recent market rally might have been overdone.
The Toronto stock market's benchmark index, which is up about 8 percent this year, eased from a two-year high it hit in the previous session.
With market focus glued on U.S. Federal Reserve monetary policy and China's plans for social and economic reform, some investors have started to question whether the gains made by global stock markets are sustainable.
Billionaire Carl Icahn said on Monday he is "very cautious" on the stock market, saying he could see a "big drop" because earnings at many companies are fueled more by low borrowing costs than by the strength of management.
Investors have been hungry for more details about the timing of the Fed's rollback of its stimulus measures, and they will be looking to an upcoming speech by Fed Chairman Ben Bernanke for clues.
"There's a little bit of a pause. The market may consolidate," said Ben Jang, a portfolio manager at Nicola Wealth Management.
"A lot of people are waiting on the sidelines, to get a little more color when Bernanke speaks tonight."
The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE closed down 15.46 points, or 0.11 percent, at 13,442.60. Continued...