CANADA STOCKS-TSX falls hard on oil price, profit-taking

Wed Jan 7, 2009 4:39pm EST
 
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* Commodity-related issues drop as oil, gold prices fall

* All of the TSX's 10 sectors fall

* U.S. jobs data boosts fears of extended recession (Updates with closing figures, adds details and comment)

By Ka Yan Ng

TORONTO, Jan 7 (Reuters) - Toronto's main stock index dropped 3.7 percent on Wednesday as oil and gold shares slid with commodity prices and profit-taking set in after six sessions of gains.

Startling job losses in the United States. and a warning from tech bellwether Intel Corp also cast a pall on investor sentiment as they heightened fears of a deep extended recession.

The energy sector slid 6.14 percent as the price of oil slumped nearly $6 a barrel to settle at $42.63 after a U.S. government inventory report showed supplies rose more than expected. Canadian Natural Resources, the index's biggest mover, fell 8.3 percent to C$51.32. EnCana (ECA.TO: Quote) lost 5 percent to C$57.80.

"Oil by far was the biggest negative. People were looking for inventories to build, but they built a lot more than expectations and that's why the price of oil has come down," said Ian Nakamoto, director of research at MacDougall, MacDougall & MacTier.

"But the price of oil has rallied a fair bit also in the last two or three weeks."   Continued...