UPDATE 3-Toronto stocks extend slide on financials, Nortel

Wed Sep 17, 2008 5:10pm EDT
 
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*Toronto stocks tumble 3 percent, enter bear territory

*U.S. financials, Nortel, continue to weigh

*Gold soars as investors seek safe haven

(Adds comments, details, official closing data)

By Natasha Elkington

TORONTO, Sept 17 (Reuters) - The Toronto Stock Exchange's main index tumbled almost 3 percent into bear-market territory on Wednesday amid worries over the U.S. financial crisis and as Nortel Networks Corp NT.TO slashed revenue forecasts and said it was looking to sell one of its businesses.

The heavily-weighted financial sector continued to slide because of persisting concerns over troubled U.S. insurer American International Group (AIG.N: Quote).

The financial services sector sank 5.1 percent, with Manulife Financial (MFC.TO: Quote) down 6.2 percent at C$33.76. Manulife fell after it said it will have unstipulated costs tied to AIG and to failed investment bank Lehman Brothers LEH.N. Insurer Sun Life Financial (SLF.TO: Quote) fell 8.1 percent to C$35.77, hitting a new year low, after disclosing its securities holdings in AIG and AIG subsidiaries.

"Manulife and Sun (Life) have spelled out pretty much what their exposure is, but none of the Canadian banks have commented and they, of course, are being hit the hardest," said John Kinsey, portfolio manager at Caldwell Securities Ltd.   Continued...