UPDATE 2-Toronto stocks sink on oil's drop, shrug off data

Fri Oct 10, 2008 12:12pm EDT
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

*Energy shares drop as oil falls to $80 on recession fears

*Strong September jobs numbers fail to lift key index

*Ottawa's C$25 bln mortgage plan shrugged off

(Adds analyst's comments, details, updates figures)

TORONTO, Oct 10 (Reuters) - The Toronto Stock Exchange's main index plunged on Friday morning as oil slid to $80 a barrel, pulling down energy shares, on fears demand will shrink if the world economy goes into recession.

An announcement that Canada will buy up to C$25 billion in Canadian mortgage-backed securities to try to cushion banks from the global financial crisis [ID:N10361962] and a surprise jump in September jobs data did not help cheer the market. [ID:nN10365080]

Leading the way down was the heavily-weighted oil and gas sector, which sank 8.5 percent as oil tumbled more than 7 percent to around $80 a barrel on persistent worries that demand for the commodity would falter on fears of a global recession. [ID:nT134769].

"We're still taking our direction from European and U.S. markets, which are still spooked," said Paul Taylor, chief investment officer at BMO Harris Investment Management Inc.

"All eyes are focused on the global economic environment and the potential for a global economic recession and global financial services instability."   Continued...