TSX falls as euro zone fears mount

Mon Sep 19, 2011 5:42pm EDT
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By Trish Nixon

TORONTO (Reuters) - Toronto's main stock index slumped on Monday, touching a one-week low, as renewed fears of a Greek default and the potential fallout for the broader euro zone pressured global equities and commodities.

The TSX's heavyweight materials and energy sectors led the way down, as oil fell more than 2 percent and copper slid to a 2011 low on fears of slowing global demand.

Among the top decliners, First Quantum Minerals (FM.TO: Quote), dropped 8.4 percent to C$19.41, Canadian Natural Resources (CNQ.TO: Quote) fell 2.1 percent to C$33.48, and Teck Resources TCKb.TO was down 3.7 percent at C$37.65. <O/R> <MET/L>

"This Greek situation has got everybody kind of spooked," said John Kinsey, portfolio manager at Caldwell Securities Ltd, noting the market seems to be preparing for Greece to default on its debt.

"A lot of people now are kind of resolved that it's going to happen, but they're hoping for the best, that it might be on a structured basis rather than just complete and utter chaos."

European officials ended a weekend meeting without agreeing on new ways to tackle the debt crisis, and a call by U.S. Treasury Secretary Timothy Geithner at the meeting for more fiscal stimulus was rejected.

The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE ended the session down 91.67 points, or 0.75 percent, at 12,172.04. During the session it fell to 12,117.77, its lowest point since September 12.

"The markets just trying to find a bottom," said Bruce Latimer, trader at Dundee Securities. "I can tell you this, we're getting close."   Continued...