TSX falls to two-and-a-half-year low as financials, energy stocks slide

Wed Jan 13, 2016 5:08pm EST
 
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By Fergal Smith

TORONTO (Reuters) - Canada's main stock index slumped on Wednesday to a 2-1/2-year low as investors used an early rally to reduce exposure to stocks and crude oil prices fluctuated on rising U.S. inventories.

The index had climbed initially after positive Chinese trade data supported sentiment.

"People don't want stocks these days and they're taking every opportunity to sell them," said John Kinsey, portfolio manager at Caldwell Securities.

Heavyweight financial stocks fell 2.1 percent, including a 2.5 percent drop in Royal Bank of Canada (RY.TO: Quote) to C$69.15.

Financials are "taking a good hit" amid concern that the impact of the oil price shock will get worse for the banks in 2016, according to Kinsey.

Enbridge Inc (ENB.TO: Quote) dropped 3.8 percent to C$42.82, while Suncor Energy Inc (SU.TO: Quote) was down 3.4 percent at C$31.33. The overall energy group fell 1.9 percent.

Brent crude fell below $30 a barrel for the first time since April 2004 as growing inventories of oil in the United States stoked market fears about demand.

Bombardier Inc (BBDb.TO: Quote) fell 4.1 percent to C$1.17. The company said it was ending a decades-long tie-up with a partner in the Middle East for business jets sales and separately canceling two dozen firm orders for its larger Global business jets.   Continued...

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