CANADA STOCKS-TSX sheds 2 percent as oil prices rattle investors

Mon Jan 5, 2015 10:48am EST
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* TSX down 301.47 points, or 2.04 percent, at 14,452.18

* All 10 main index sectors decline

* Canadian Natural plunges 6.8 percent

By John Tilak

TORONTO, Jan 5 (Reuters) - Canada's main stock index dropped more than 2 percent on Monday as a sharp selloff in the price of oil sent shares of energy companies tumbling, with investors trying to assess the impact of the recent pullback on both the economy and equity markets.

The energy sector shed more than 5 percent in the session and has lost about a third of its value in the last six months. Oil prices plunged to a 5-1/2-year low on persistent concerns about oversupply.

All 10 main sectors on the Toronto equity index were trading in the red. The benchmark, which managed to record a modest gain in 2014, has been held back by the energy group.

"It looks like oil is taking everything down with it," said Philip Petursson, managing director, portfolio advisory group, at Manulife Asset Management. "This could be indicative of a weaker economic environment for 2015, and that is starting to be realized by the equity market."

"It's all about oil," he added. "So in the short term, it continues to show weakness for the TSX. If we look 12 to 18 months out, we see the TSX rebounding on a rebounding oil price."   Continued...