CORRECTED - CANADA STOCKS-TSX skids 5.36 percent in global stock selloff

Mon Mar 2, 2009 4:39pm EST
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(Corrects headline to show TSX was down 5.36 percent, not 5.6 percent)

* Energy sector down 8.3 pct, financials slump 4.5 pct

* TSX comes within 24 points of a multi-year low

* AIG quarterly loss rattles financial shares (Adds comments, official numbers)

By Frank Pingue

TORONTO, March 2 (Reuters) - Toronto's main stock index joined a global equity selloff on Monday, falling more than 5 percent for its biggest one-day drop in three months, due to weaker oil prices and data that showed the Canadian economy shrank.

Heavily weighted financial shares were also a major drag on the index as news that U.S. insurer AIG (AIG.N: Quote) posted a record quarterly loss fueled fears that the global financial crisis was worsening.

That sentiment dragged shares of insurer Manulife Financial (MFC.TO: Quote) down 10 percent to C$11.58, while Bank of Nova Scotia (BNS.TO: Quote) tumbled 5.85 percent to C$27.03. The Toronto Stock Exchange's broader financial index ended down 4.5 percent.

"The market is down over worries about global growth as well as continued worries about what's happening with financial services in the U.S. and how much worse it will get, which is affecting financials everywhere." said Kate Warne, Canadian market strategist at Edward Jones in St. Louis, Missouri.   Continued...