February 18, 2009 / 12:49 PM / 9 years ago

TSX dragged lower by weak oils, financials

TORONTO (Reuters) - Toronto’s main stock index fell broadly on Wednesday for a third straight session, touching a 2009 low, pressured by weak energy and financial issues and a slide by Rogers Communications Inc.

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

The heavily weighted financial services and energy sectors both retreated 3.6 percent, while telecoms also tumbled 3.6 percent.

EnCana Corp dropped 3.7 percent to C$49.40 and Royal Bank of Canada fell 4.2 percent to C$26.98.

Rogers shed 7.7 percent to C$31.70 after the media and communications company said it swung to a quarterly loss as it took almost C$300 million in impairment charges on its conventional television business to reflect the impact of the weak economy.

The market’s drop came even as U.S. President Barack Obama unveiled a plan that pledged up to $275 billion to help stabilize the troubled U.S. housing market.

“There continues to be a lot of skepticism about these big, billion-dollar packages being announced by the U.S. government,” said Elvis Picardo, analyst and strategist at Global Securities in Vancouver.

Picardo said the Toronto market may also be under pressure as it plays “catch up” to slumping U.S. stocks.

The Toronto index is down 9 percent so far this year, while the Dow Jones industrial average is down about 14 percent and the Standard & Poor’s 500 index is off about 13 percent, he noted.

The S&P/TSX composite index fell 202.75 points, or 2.42 percent, to finish at 8,175.95, with all but one of its 10 main sectors in the red. At one point, the index dropped to 8,138.98, its lowest level in 2009.

The lone sector in the black was the resource-laden materials sector, which eked out a 0.9 percent gain as investors flocked to gold for refuge from the economic gloom.

Barrick Gold climbed 2.6 percent to C$48.40 and Goldcorp rose 1 percent to C$40.85.

The TSX’s retreat follows a drop of nearly 3.5 percent on Tuesday, as a string of reports fanned concerns about global recession and the health of the banking industry.

The fall came even as the resource-heavy TSX opened slightly higher, but quickly retreated.

“We never got off the ground,” said David Cockfield, senior vice-president and portfolio manager at Leon Frazer & Associates in Toronto.

“It was a very strange day ... the news wasn’t that bad but the markets sold off anyway,” Cockfield said. “It was much more of portfolio decision than on anything based on the fundamentals of the day.”

On the upside, Potash Corp of Saskatchewan, the top net gainer, rose 3.7 percent to C$102.56. Its chief executive said the fertilizer producer expects gross margins to grow significantly in the years ahead as the company continues to expand its potash production capacity.

The blue chip S&P/TSX 60 index closed 11.87 points lower, or 2.37 percent, at 489.49.

($1=$1.26 Canadian)

Reporting by Jennifer Kwan; editing by Rob Wilson

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