Toronto stocks fall with weak financials, oils

Fri Jun 20, 2008 5:28pm EDT
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

By Cameron French

TORONTO (Reuters) - The Toronto Stock Exchange's main index fell more than 200 points on Friday as financial issues were hurt by inflation fears and worries over more U.S. mortgage-related problems, while consumer stocks also fell.

The S&P/TSX composite index .GSPTSE slid 209.48 points, or 1.42 percent, to close at 14,580.67, as all ten TSX subgroups lost ground.

Inflation worries weighed on both financials and consumer stocks, after Bank of Canada Governor Mark Carney said late on Thursday that rising energy prices could lead to higher inflation.

"There's some worry that interest rates may not fall any further, and may even start to rise, which in turn would squeeze the banks' margins," said Gavin Graham, chief investment officer at Guardian Group of Funds.

The heavily weighted financial subgroup fell 2.34 percent, while the consumer discretionary and consumer staples groups fell 2.61 percent and 2.46 percent, respectively.

Also hurting bank shares were rumors that U.S. commercial bank Merrill Lynch MER.N may issue a profit warning and take additional writedowns on its mortgage holdings.

Canadian Imperial Bank of Commerce (CM.TO: Quote) fell C$1.87, or 2.9 percent, to C$61.63, while insurer Manulife Financial (MFC.TO: Quote) dropped C$1.12, or 2.9 percent, to C$37.13.

The overall decline marked the second-straight day of heavy losses for Canada' main stock index, which hit an all-time intraday high of 15,154.77 on June 6.   Continued...

<p>A general view of the TSX (Toronto Stock Exchange) Broadcast Centre in Toronto June 20, 2008. REUTERS/Mark Blinch</p>