TSX tumbles to near four-month low on U.S. data, Ebola fears
By John Tilak
TORONTO (Reuters) - Canada's main stock index dropped on Wednesday to a near four-month low as worries about a slowdown in U.S. factory activity and news of the first confirmed case of Ebola in the United States fueled a broad selloff.
The benchmark index has dropped in eight of its past nine sessions.
Growth in U.S. factory activity slowed more than expected in September to its lowest level since June, according to data released on Wednesday.
Adding more pressure, a business survey from the euro zone showed manufacturing growth in the region slowed in September as new orders contracted for the first time in more than a year.
The Toronto stock market's benchmark index fell 4.3 percent in September, its biggest monthly drop since May 2012. As well as a U.S. dollar rally and softening commodity prices, geopolitical tensions and worries that the U.S. Federal Reserve will raise interest rates sooner than expected have been nagging the market.
"This overhang that the rates are going to rise at some point has had a bit of a dampening effect," said Brad Radin, chief investment officer of Radin Capital Partners. “Equity markets go up over time, but they also have breathers, and we're right in the middle of one of those."
“The far bigger risk for most long-term investors is that they wake up five years from now and realize that they had too many bonds in a rising interest rate environment,” he added.
The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE closed down 155.07 points, or 1.04 percent, at 14,805.44. It is down about 5.6 percent since hitting a record high last month. Continued...