May 6, 2010 / 10:11 PM / 7 years ago

CANADA STOCKS-TSX falls for 4th straight day, hits 10-week low

* TSX ends down 0.28 percent at 11,824.43

* 3.8 pct intraday drop biggest since June 2009

* Euro zone debt fears help trigger heavy selling

* Oils lead index lower as crude price sags

* Financials fall, but insurer profits shine (Adds details, background)

By Ka Yan Ng

TORONTO, May 6 (Reuters) - Toronto’s main stock index closed lower for a fourth straight session on Thursday, but cut a 3.8 percent intraday tumble that was sparked by a drop in crude futures and worries the Greek debt crisis may widen to other euro zone countries.

The TSX energy sector sagged 1.41 percent, though losses were four times bigger at one point, as U.S. crude prices fell below $77 a barrel on fears the debt crisis could threaten economic recovery and undercut demand for oil. [O/R]

EnCana Corp (ECA.TO) fell 1.39 percent to C$31.95 and Nexen NXY.TO dropped 2.88 percent to C$22.97.

Heavyweight financials were down by 1.26 percent, with Royal Bank of Canada (RY.TO) off 2.68 percent at C$59.57 and Bank of Montreal (BMO.TO) down 3.05 percent at C$59.07, although strong profits at the country’s biggest insurers helped to reduce the steep drop.

The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE finished down 32.70 points, or 0.28 percent, at 11,842.43.

Amid the selloff, the TSX fell 452 points, or 3.8 percent, to 11,422,73, its lowest level since Feb. 25. It was the steepest one-day percentage fall since June 2009.

By the end of the session, six of the index’s 10 main groups had bounced back. But lower energy and financials, two of the most influential sectors, underscored lingering worries over wider contagion from Greece’s debt crisis.

Thursday afternoon’s rapid slide by the TSX echoed an even sharper plunge by U.S. stocks, with Nasdaq down more than 9 percent at one point. [.N] [MKTS/GLOB]

Along with the Greek debt crisis, analysts also cited uncertain U.K. elections and a large, erroneous trade entered by a a big Wall Street bank as possible reasons behind the session’s volatility. [ID:nN06234011]

“Some or all of it could have contributed to this.” said Ian Nakamoto, director of research at MacDougall, MacDougall & MacTier. “It’s a confluence of anxiety.”

The TSX, which hit its highest level since September 2008 late last month, has closed lower for four straight days as investors try to sort out sentiment about Europe’s debt woes.

“We had a couple days of setbacks and people are looking at what’s going on -- and the money is voting with its feet and saying that it is not comfortable with the run that we have had in the market,” said Conor Bill, managing director at Mt. Auburn Capital.

INSURERS, MAGNA GAIN

Materials gained nearly 2 percent on strong support from gold producers as the precious metal jumped 3 percent to a near record on a broad flight to safety. [GOL/]

Yamana Gold (YRI.TO) gained 6.08 percent to C$11.34, while Agnico Eagle (AEM.TO) surged 4.79 percent to C$66.92.

There were some other bright spots as shares of companies that reported solid earnings got a boost.

Manulife Financial Corp (MFC.TO), Great West Lifeco Inc (GWO.TO) and Sun Life Financial Inc (SLF.TO) boasted relatively clean and optimistic profit pictures in the first quarter, pushing their shares higher as the broader market swooned, including the financials group. [ID:nN0696586]

Manulife rose 3.28 percent to C$18.25, while Sun Life added 2.51 percent to C$29.85. Great West advanced 2.33 percent to C$26.82.

Magna International Inc MGa.TO roared back to profit, and announced founder Frank Stronach will release his grip on the world’s No. 3 auto parts maker in a deal that will end a dual-share structure that analysts say crimped Magna’s valuation.

Magna’s Class A shares, the only class that will remain, surged as much as 23 percent on the announcement, easing later to end up 14 percent at C$73.26. [ID:nSGE6450HC]

$1=$1.05 Canadian Additional reporting by Jennifer Kwan and Scott Anderson; editing by Rob Wilson

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