January 9, 2009 / 10:06 PM / 9 years ago

CANADA STOCKS-TSX closes lower as crude retreats

* TSX sags 136 points on day

* Finishes week down 1.6 percent

* Oil price slides amid more economic gloom (Adds details)

By Frank Pingue

TORONTO, Jan 9 (Reuters) - Toronto’s key stock index closed sharply lower on Friday as employment data from Canada and the United States provided more evidence of a global recession, undercutting oil prices and shaking the resource-heavy TSX.

After charging out of the gate in 2009 with a string of solid gains that had the index up 5.76 percent earlier this week, a few losing sessions, mostly at the hands of lower oil prices, have left the market up just 1 percent on the year.

The heavyweight energy sector led Friday’s decline with a 2.5 percent retreat as the price of crude slipped 2 percent.

Shares of EnCana Corp (ECA.TO), one of the key drags on the index, finished down 2.8 percent at C$56.57, while Suncor Energy (SU.TO) dropped 3 percent to C$27.89.

The S&P/TSX composite index .GSPTSE finished down 136.40 points, or 1.48 percent at 9,085.18. That was barely off its session low of 9,053.16, and far from the day’s high, which had the market up 45.93 points shortly after the open.

Oil prices fell when jobs data released ahead of the market open showed a sharp rise in U.S. unemployment in December, which added to the dismal outlook for the world’s biggest economy.

That news came shortly after a report showed the Canadian jobless rate rose to a two-year high of 6.6 percent on bigger than expected job losses in December. [ID:nN09284759]

“Generally, the data confirmed how people are viewing the first half of the year and that it is going to be tough times,” said Brian Pow, vice-president, research and equity analyst at Acumen Capital Partners in Calgary.

“I think the New Year’s rally was one of a little bit of hope, but I think that as the data points come out it will prove that we are in some tough times.”

The latest batch of Canadian economic data, which also showed weakness in the housing market, seemed to signal that the Bank of Canada will cut interest rates again at its next policy announcement date on Jan. 20.

It added to a growing list of negative news that in recent months has yanked the key Toronto stock index lower.

“People are generally negative. You pick up the newspapers and it tends to be more negative than positive ... so people are fearful,” said Irwin Michael, portfolio manager at ABC Funds. “When you get that sort of psychology, everything is negative and people are quite concerned and that’s affecting it all. The market’s going to remain very volatile.”

On Wall Street, stocks ended lower after data showed the U.S. labor market deteriorated again in December, which raised investor concerns about the outlook for corporate profits and a deepening recession.

The Dow Jones industrial average .DJI fell 142.28 points, or 1.64 percent, to 8,599.18, while the Nasdaq Composite Index .IXIC ended down 45.42 points, or 2.81 percent, at 1,571.59.

$1=$1.19 Canadian Reporting by Frank Pingue; 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