CANADA STOCKS-TSX sinks 2 pct as financials, oil drag

Thu May 7, 2009 3:09pm EDT
 
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* Big Three insurers report weaker-than-expected results

* Energy group succumbs to oil price reversal

* TSX ranges 9,922.03-10,340.78, touched 2009 high (Updates to midafternoon)

TORONTO, May 7 (Reuters) - Toronto's main stock index sank on Thursday afternoon, pulled down by weaker-than-expected results from Canada's big insurers and a reversal in crude oil prices.

The financial group, an influential sector that makes up a third of the index weighting, was off more than 3 percent as the country's top three insurers reported quarterly results that reflected ailing stock markets, credit impairments and the need to shore up reserves. [ID:nN07467694]

Manulife (MFC.TO: Quote) fell 3.4 percent to C$21.96, while Sun Life (SLF.TO: Quote) fell 4.6 percent to C$28.58. Great-West Life (GWO.TO: Quote) fell 4.2 percent to C$21.94.

Banks were also under pressure, with Royal Bank of Canada (RY.TO: Quote) off 2.78 percent at C$43.75, ahead of the results of "stress tests" of major U.S. banks due at 5 p.m. (2100 GMT). Leaked reports show that about half will not need new capital. [ID:nL776802]

The energy group was off 1.47 percent as the price of oil reversed after sharp gains. The materials group fell 1 percent, while gold issues sheltered some of the losses because the price of gold remained firm though off highs.

At 2:45 p.m. (1845 GMT), the S&P/TSX composite index .GSPTSE fell 207.42 points, or 2.04 percent, to 9,936.01. Nine of the index's 10 sectors were higher.   Continued...