CANADA STOCKS-TSX ends lower on credit concerns

Tue Mar 3, 2009 5:03pm EST
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* Late-session rally in equities falters

* Financial shares spearhead TSX index's skid

* TSX now down 6 percent on the week (Adds details and comments)

By Frank Pingue

TORONTO, March 3 (Reuters) - Toronto's main stock index ended lower on Tuesday as nagging credit quality worries pulled shares of Canadian banks lower, but a late rally allowed the index to climb off a five-year low hit earlier in the session.

The financial sector, which accounts for about 30 percent of the index, led the decline as investors focused more on provisions for bad loans in the quarterly reports of Bank of Nova Scotia (BNS.TO: Quote) and Bank of Montreal (BMO.TO: Quote) than on the resilience of the banks in staying profitable. [ID:nN03459519]

Shares of insurer Manulife Financial (MFC.TO: Quote) led the index lower as its shares tumbled 11 percent to C$10.31, followed by Toronto-Dominion Bank (TD.TO: Quote), which ended down 2 percent at C$35.44.

The index staged a late rally as some investors figured the equity selloff early on Tuesday may have marked the end of a grueling skid in global equities. But the rally sputtered as the session neared an end.

"We are groping for a low," said Ron Meisels, technical analyst and president of Phases & Cycles in Montreal. "The people who are looking at the market are now hoping and praying that the recent lows will hold."   Continued...