CANADA STOCKS-Swine flu fears pull down TSX

Mon Apr 27, 2009 10:23am EDT
 
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* TSX index down 119.21 points, or 1.25 pct, at 9,430.27

* Fears of a global swine flu pandemic grows

* Resource stocks hit hardest

TORONTO, April 27 (Reuters) - Toronto's main stock index fell sharply on Monday morning after seven straight weeks of gains as concerns about a possible global swine flu outbreak hit commodity prices, dimming hopes for an economic recovery.

The oil and gas sector was off 2.02 percent as the price of oil dropped more than 5 percent to below $49 a barrel, partly on concern that the world economy could struggle if a swine flu outbreak in Mexico turns out to be the start of a global pandemic. [ID:nLR259704]

Shares of energy companies make up about 22 percent of the overall index and often lead the TSX up or down. Canadian Natural Resources (CNQ.TO: Quote) was the top drag on the index, falling 1.95 percent to C$58.28.

The materials group lost 1.85 percent, led by a 2.1 percent drop in fertilizer company Potash Corp of Saskatchewan (POT.TO: Quote) to C$99.50.

Even typically safe-haven gold-mining stocks were under pressure as the price of bullion slipped as the firmer U.S. dollar prompted investors to cash in gains after gold's rise to a four-week high. [ID:nLR139073]

"The main driver is fear that the swine flu will slow down a few sectors," said Francis Campeau, broker at MF Global Canada, in Montreal.   Continued...