CANADA STOCKS-Resources lead slide on TSX as flu fears swirl

Mon Apr 27, 2009 5:32pm EDT
 
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* TSX index falls 1.6 pct to end four-session rally

* Fears of a global swine flu pandemic grow

* Oil and gas sector drops 2.4 percent (Adds details)

By Ka Yan Ng

TORONTO, April 27 (Reuters) - Toronto's main stock index fell 1.6 percent on Monday, breaking a four-session rally, as fears of an international swine flu outbreak rattled commodity prices, dampening hopes for an economic recovery.

Resource-related issues, which make up about 40 percent of the overall TSX index, were hit hardest by worries that the already-fragile world economy could be further damaged if a swine flu outbreak in Mexico turns out to be the start of a global pandemic. [ID:nLR259704]

Flu fears may nag for some time, analysts said, but it is too soon to predict the impact on markets, which have been rising on improving sentiment of the global economy.

"If people are convinced it's going to be a long period of time, then all bets are off. But at this point in time, it's still relatively early," said Ian Nakamoto, director of research at MacDougall, MacDougall & MacTier.

The oil and gas sector dropped 2.4 percent as the price of crude fell more than 2 percent to above $50 a barrel, partly because of worries the flu outbreak could cut back on air travel, lowering demand.   Continued...