January 7, 2009 / 5:45 PM / 9 years ago

CANADA STOCKS-TSX drops 2.6 pct as oils, gold drag

* Commodity-related issues drop as oil, gold prices fall

* U.S. jobs data boosts fears of extended recession

* Rogers falls on subscriber results, analyst downgrade

* Intel warning weighs (Updates figures, adds details and analyst's comment)

By Ka Yan Ng

TORONTO, Jan 7 (Reuters) - Toronto's main stock index was 2.6 percent lower at midday on Wednesday, led down by oil and gold shares as commodity prices dropped and as a bout of profit-taking set in after six straight sessions of gains.

The energy sector was down 4.7 percent as the price of oil slumped more than $3 a barrel after a U.S. government inventory report showed supplies rose more than expected. Oil company EnCana (ECA.TO), the index's biggest mover, shed 4.8 percent to C$57.93.

Gold issues fell with the price of gold, which slipped more than 3 percent. That weighed on the materials group, which dropped 3.4 percent. Barrick Gold (ABX.TO) was down 4.3 percent at C$38.09.

The heavily weighted financial sector was also a drag, down 2 percent, led lower by Manulife Financial (MFC.TO) and Royal Bank of Canada (RY.TO). Manulife, Canada's biggest insurer, fell 3.8 percent to C$23.19, while Royal, Canada's biggest bank, lost 1.7 percent to C$37.39.

At 12:25 p.m. (1725 GMT), the S&P/TSX composite index .GSPTSE was down 257.86 points, or 2.72 percent, at 9,214.23. All 10 main groups were in the red.

Francis Campeau, a broker at MF Global Canada in Montreal, said weak U.S. jobs numbers and a lower forecast from Intel, were among factors pulling the TSX down on Wednesday. But the index was also due for a retreat, he said.

"We basically rallied 13 percent in six consecutive sessions. So a bit of pullback and profit-taking is normal, and a good breather," he said.

Intel warned its fourth-quarter revenue would likely come in worse than expected due to weaker global demand for personal computers. That sent chills across U.S. tech stocks and added to worries about a prolonged recession.

Dismal U.S. jobs data from a private employment service cast a pall on investor sentiment on both sides of the border. U.S. private-sector employers shed 693,000 jobs in December, a report by ADP Employer Services showed, suggesting more dire news to come in U.S. government jobs data due on Friday. [ID:nnN07472855]

Canadian jobs figures are also due on Friday, and likely to underscore economists' forecasts that the Canadian economy is in for a rough ride through the first half of the year and will see little or no growth in 2009 as the recession takes hold. [ID:nN07477584]

Rogers Communications Inc (RCIb.TO) extended losses for a second day, down 3.6 percent at C$33.75, after an analyst downgraded the stock following the release of weaker than expected cable-TV subscriber results. [ID:nN07479276]

$1=$1.19 Canadian Reporting by Ka Yan Ng; editing by Peter Galloway

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below