CANADA STOCKS-TSX rattled by weak oil, political turmoil

Thu Dec 4, 2008 4:36pm EST
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* TSX index closes at lowest level since Nov. 20

* Energy sector skids 7.5 percent, leads market slide

* Suspension of Parliament dampens investor sentiment (Adds details)

By Frank Pingue

TORONTO, Dec 4 (Reuters) - The Toronto Stock Exchange's main index fell to its lowest close in two weeks on Thursday as a slide in oil prices shook the resource-heavy market, while the suspension of Canada's Parliament weighed on sentiment.

Oil prices fell more than 6 percent to their lowest level in almost four years, pulling Toronto's heavily weighted energy sector down 7.46 percent.

A decision by the Canada's governor general to grant Prime Minister Stephen Harper's request that Parliament be suspended until Jan. 26, amid opposition attempts to bring down his government, hurt sentiment since it likely means there will be no government plan to stimulate the economy until at least the new year.

The S&P/TSX composite index .GSPTSE closed down 239.14 points, or 2.88 percent, at 8,057.82 with seven of its 10 subindexes finishing lower.

Shares of oil company Canadian Natural Resources CNQ.TO, which fell 13.45 percent to C$41.00, were the biggest drag on the index, followed by oil company EnCana Corp ECA.TO, which dropped 5.79 percent to C$49.82.

"Commodity prices are weak so that was a problem," said Tim Burt, president and chief investment officer at Cardinal Capital Management Inc in Winnipeg, Manitoba.

"And then with the government being suspended until Jan. 26 it basically means that we're not going to get any initiative out of Ottawa to try and stimulate the economy." (Reporting by Frank Pingue; editing by Peter Galloway)