UPDATE 1-Toronto stocks dive on more credit crisis fallout

Mon Sep 29, 2008 10:20am EDT
 
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*Energy stocks fall 6.5 percent on oil's slide

*Financials drop 1.8 percent as bank jitters spread

*Manulife chief says insurer in "excellent" shape

(Adds details)

TORONTO, Sept 29 (Reuters) - The Toronto Stock Exchange's main index was sharply lower on Monday morning as the rescue of European banks and a takeover of most of Wachovia Corp WB.N by Citigroup (C.N: Quote) heightened concerns about the fallout from the credit crisis.

Markets were on tenterhooks as European authorities set several bank rescue operations on Monday, including a plan to partly nationalize Fortis NV FOR.BR [ID:nLS357697]. In the United States, Citigroup, the largest U.S. bank, set a deal to acquire the bulk of Wachovia's assets. [ID:nLT436737].

Meantime markets awaited the U.S. House vote on the big financial industry bailout plan. [ID:nLT436737] For links to more stories, see [ID:nN22402709]

Shortly before 10 a.m. EDT, the S&P/TSX composite index .GSPTSE was down 438.54 points, or 3.62 percent, at 11,687.46, with all of its 10 main groups lower.

The heavily-weighted energy and materials groups, which combined account for about half of the index's weigh, slumped 6.5 percent and 4.2 percent, respectively, as oil plunged more than $5 to $101.50 a barrel on a firmer U.S. dollar and on signs the credit crisis is spreading beyond the United States to Europe. [ID:nSYD370166]   Continued...