CANADA STOCKS-TSX sags along with commodity prices

Wed Nov 5, 2008 5:44pm EST
 
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* Focus back on economy after historic U.S. election

* Energy stocks sink 3.5 pct as oil falls to $65.30/barrel

* Materials group down 1.9 pct as metal prices skid (Adds quote, details)

By Jennifer Kwan

TORONTO, Nov 5 (Reuters) - The Toronto Stock Exchange's main index closed more than 2 percent lower on Wednesday as oil and mining shares fell as commodity prices dropped on worries that demand is slowing due to a faltering world economy.

Major drags on the benchmark included Potash Corp of Saskatchewan (POT.TO: Quote), down 5.5 percent at C$102.00, Royal Bank of Canada (RY.TO: Quote), which sank 1.9 percent to C$46.71, and Canadian Natural Resources (CNQ.TO: Quote), 3.7 percent lower at C$60.41.

The index's energy and base-metals groups sank 3.5 percent and 7.9 percent, respectively, as commodities prices slumped as stock markets returned their gaze to the faltering global economy after rising on Tuesday in anticipation of Barack Obama's victory in the U.S. presidential election. [ID:nL5544119]

"It's sort of the old adage: buy on rumor and sell on news," said Peter Chandler, senior vice-president at Canaccord Capital in Waterloo, Ontario.

"Now the market goes back and starts to focus on the economy and some of the economic figures, and they're slow, they're weak, they're anemic at best. So too are the corporate earnings and, more importantly, the outlook corporations are providing looking forward for the next several quarters."   Continued...