Toronto stocks extend slide on financials, Nortel
By Natasha Elkington
TORONTO (Reuters) - The Toronto Stock Exchange's main index tumbled almost 3 percent into bear-market territory on Wednesday amid worries over the U.S. financial crisis and as Nortel Networks Corp NT.TO slashed its revenue forecasts and said it was looking to sell one of its businesses.
The heavily weighted financial sector continued to slide amid persistent concerns over troubled U.S. insurer American International Group (AIG.N: Quote) and a series of Wall Street failures and takeovers.
"It does seem like there is a bit of panic selling here," said Ian Nakamoto, director of research at MacDougall, MacDougall & MacTier.
"I think there's a message being sent by investors to the Federal Reserve and U.S. Treasury, even though it seems they have done a lot in terms of helping various organizations, the latest one being AIG, it's still not enough," Nakamoto said.
The S&P/TSX composite index .GSPTSE closed down 349.30 points, or 2.86 percent, at 11,877.69. A bear market is often defined as one that is down 20 percent from its high point. The index has fallen 22 percent since its June record high.
All but one of the TSX's 10 main groups ended in the red, including the key energy sector, which lost 1.3 percent despite gains in oil prices, and the heavyweight financials, off 5.1 percent.
Manulife Financial (MFC.TO: Quote) ended down 6.2 percent at C$33.76 after it said it will have unstipulated costs tied to AIG and to failed investment bank Lehman Brothers LEH.N.
Insurer Sun Life Financial SLF.TO fell 8.1 percent to C$35.77, hitting a new year low, after disclosing its securities holdings in AIG and AIG subsidiaries. Continued...