UPDATE 5-Toronto stocks beaten down by recession worries

Fri Apr 11, 2008 5:09pm EDT
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By Leah Schnurr

TORONTO, April 11 (Reuters) - The Toronto Stock Exchange's main index shed more than 225 points on Friday, hit hard by deepening worries for a weak earnings season and another sign the United States may be sliding into a recession.

The sour tone was set early in the day by an unexpected drop in first-quarter profit by conglomerate General Electric GE.N, seen as a bellwether for the U.S. economy.

The slump on Bay Street was exacerbated by sliding resource shares, which were hampered by soft commodity prices. Suncor Energy SU.TO fell C$3.02, or 2.8 percent, to C$106.82, while Barrick Gold ABX.TO was down C$1.24, or 2.8 percent, at C$43.76. The energy and materials sectors gave up 1.5 percent and 1.6 percent respectively.

Financials also lagged, losing 1.7 percent, with Bank of Nova Scotia BNS.TO down C$1.19, or 2.6 percent, at C$45.54. The Wall Street Journal reported on Thursday that Scotiabank had entered the bidding for a stake in troubled U.S. bank National City NCC.N.

Elsewhere in the sector, Royal Bank of Canada RY.TO fell 90 Canadian cents, or 1.9 percent, to C$46.38.

The S&P/TSX composite index .GSPTSE closed down 226.55 points, or 1.63 percent, at 13,683.03 with all 10 of its main sectors lower. It was the worst one-day decline in over three weeks.

The index managed to edge up just 0.1 percent for the week, after giving up the bulk of the week's gains on Friday. But the composite has advanced 2.5 percent since the beginning of the month in the midst of recent boost in confidence.   Continued...