CANADA STOCKS-TSX dives as global risk worries mount

Thu Apr 22, 2010 10:48am EDT
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*TSX down 0.93 percent at 12,021.13

*Financials, resources lead index lower

By Claire Sibonney

TORONTO, April 22 (Reuters) - Toronto's main stock index fell sharply on Thursday morning, ending a three-day rally, as worries over U.S. financial reform, debt-stricken Greece and monetary tightening in China combined to undermine confidence.

The index's heavily weighted financial sector fell 0.9 percent as Royal Bank of Canada (RY.TO: Quote), the country's biggest bank, slipped 0.7 percent to C$61.14, and Bank of Nova Scotia (BNS.TO: Quote) dropped 1.1 percent to C$51.60.

U.S. President Barack Obama in a speech in New York on Thursday was set to tell Wall Street to accept a sweeping bill to overhaul financial regulations.

"I think you're seeing a fairly aggressive approach to financial reform as well as potentially politicizing Wall Street a bit, so I think a lot of people are taking a little bit of risk off the table," said Youssef Zohny, associate portfolio manager at Van Arbor Asset Management in Vancouver.

"And at the same time, along with Greece, especially in terms of the euro and the commodity space, you're seeing some weakness out of China, so I think all three of those factors are pretty much what's driving the markets today."

Data showed Greece's budget deficit was worse than previously thought, which boosted the safe-haven U.S. dollar, pressuring gold prices. [GOL/]   Continued...