TSX knocked down more than 1 percent as energy crumbles

Wed Aug 19, 2015 5:22pm EDT
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By Alastair Sharp

TORONTO (Reuters) - A capitulation in heavyweight energy stocks pummeled Canada's main stock index on Wednesday, pushing it down 1.1 percent as crude oil prices plumbed new depths after a shock rise in U.S. stockpiles.

The energy group sank 4.3 percent, knocking it to its lowest since August 2004, in line with a similar fall in the commodity after the U.S. inventories numbers reinforced concerns about a global supply glut. [O/R]

"There's quite a bit of panic in the energy sector right now," said Youssef Zohny, portfolio manager at StennerZohny Investment Partners+ of Richardson GMP Ltd.

The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE ended down 157.24 points, at 14,036.63. There were three decliners for every advancing stock.

Canadian Natural Resources Ltd (CNQ.TO: Quote), the country's largest independent petroleum producer, lost 5.6 percent to C$28.30 and Suncor Energy Inc (SU.TO: Quote), Canada's largest oil and gas company, fell 3.2 percent to C$35.16.

Ten smaller operators gave up between 7 and 15 percent of their market value.

Zohny said that for investors with a three-to-five-year horizon, some names could be considered buying opportunities at these levels.

"There's quite a bit of bad news priced into the sector and there could still be some short-term pain, but it's definitely starting to look more attractive," he said.   Continued...

A man walks past an old Toronto Stock Exchange (TSX) sign in Toronto, June 23, 2014. REUTERS/Mark Blinch