TSX sinks as growth fears intensify

Fri Jun 1, 2012 4:46pm EDT
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By Jon Cook

TORONTO (Reuters) - Canadian stocks tumbled on Friday, led by energy and financial issues as economic data on both sides of the Atlantic raised fears of a global slump and sent investors out of riskier assets into gold and other safe havens.

After one of the worst Mays in recent years for equity markets, June began badly on a backdrop of euro zone debt worries, a tentative recovery in the United States and more moderate growth in China.

Markets extended losses after U.S. jobs growth in May was the weakest in a year, suggesting a faltering U.S. economic recovery.

"Today's jobs number was just the tipping point and the markets just went into full pessimism mode," said Philip Petursson, managing director of the portfolio advisory group at Manulife Asset Management.

Nine of Canada's 10 main sectors finished in the red. Losses were sharpest among the oil and gas group, which dropped 3.3 percent as U.S. crude oil futures settled at its lowest level in nearly eight months.

Declines were led by Canadian Natural Resources, down 3.7 percent to C$28.56, Cenovus Energy, off 4.7 percent at C$31.03, and Enbridge Inc, which sank 3 percent to C$39.60.

Petursson said Canada's energy index, down almost 15 percent since the beginning of May, has been hurt by speculators getting out of the oil trade as prices fall.

The Toronto Stock Exchange's S&P/TSX composite index closed down 152.01 points, or 1.3 percent, at 11,361.20. It was down 1.9 percent for the week.   Continued...

A Toronto Stock Exchange (TSX) logo is seen in Toronto November 9, 2007. REUTERS/Mark Blinch