TSX falls 2 percent as banks, energy stocks sink

Tue Feb 9, 2016 5:17pm EST
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By Fergal Smith

TORONTO (Reuters) - Canada's main stock index fell on Tuesday to a two-week low, again weighed down by bank and energy company shares as crude oil prices tumbled and investors globally worried about negative interest rates.

The drop in oil prices was the major factor weighing on the market, according to Bryden Teich, associate portfolio manager at Avenue Investment Management.

U.S. crude CLc1 prices settled at $27.94 a barrel, down 5.89 percent.

Financial stocks across the world have suffered, Teich added, as the "whole banking model gets flipped on its head" by negative interest rates concerns.

The most influential movers on the index were its heavyweight banks, with the financials group down 2.4 percent overall, while the energy sector tumbled 4.7 percent, extending Monday's losses.

Royal Bank of Canada (RY.TO: Quote) fell 2.4 percent to C$67.64, while Suncor Energy Inc (SU.TO: Quote) lost 4.5 percent to C$29.95.

Fortis Inc (FTS.TO: Quote) shares plunged 10.3 percent to C$37.14 after the utility said it would buy a U.S. power transmission company.

The added leverage that Fortis will take on weighed on the stock, according to Teich.   Continued...

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