CANADA STOCKS-TSX drops on bank woes and lower oil price

Tue Apr 7, 2009 9:55am EDT
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* TSX falls 127 points to 8,892.52

* Banks and energy shares headline drop

By Frank Pingue

TORONTO, April 7 (Reuters) - Toronto's main stock index was down more than 1 percent on Tuesday morning as concerns about toxic assets rattled shares of banks and insurers, while a drop in oil prices pulled down the energy sector.

The financials index was down 1.7 percent following news that the International Monetary Fund was set to forecast toxic assets racked up by banks and insurers could hit $4 trillion. [ID:nT186243]

Royal Bank of Canada RY.TO was down 1.7 percent at C$37.55, while Toronto-Dominion Bank TD.TO fell 1.22 percent to C$44.71.

"The toxic assets are obviously key and with oil prices underneath $50 (a barrel) that's quite a bit of negative for Canada," said Sal Masionis, stockbroker at Brant Securities.

The price for oil, a key Canadian export that often influences direction for the TSX, pulled the energy sector down by 2.65 percent.

Shares of EnCana Corp ECA.TO, the biggest drag on the overall index, were down 3.7 percent at C$52.84, while Canadian Natural Resources CNQ.TO was off 2.9 percent at C$51.93.

At 9:45 a.m. (1345 GMT), the S&P/TSX composite index .GSPTSE was down 127.55 points, or 1.41 percent, at 8,892.52. Nine of the TSX's 10 sectors were lower

($1=$1.24 Canadian) (Reporting by Frank Pingue; editing by Peter Galloway)