TSX tumbles to 2-month low, oil shares rattled

Wed Oct 28, 2009 5:06pm EDT
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By Frank Pingue

TORONTO (Reuters) - Toronto's main stock index skidded to its lowest close in nearly two months on Wednesday as a drop in oil prices shook EnCana Corp and other energy companies and as surprisingly bleak U.S. home sales data raised doubts about economic recovery.

Shares of EnCana ended down 4 percent at C$59.74, Suncor Energy shed 3.2 percent to C$35.82, and Canadian Natural Resources fell 3.6 percent to C$70.50.

The companies were the three biggest drags on the TSX index.

The latest slide in the heavily weighted energy sector came as oil prices fell more than 2 percent on worries about demand in the United States, the world's largest fuel consumer.

Also in the United States, sales of newly built single-family homes unexpectedly fell 3.6 percent last month, stirring fears that economic recovery may be falling flat.

Shares of gold miners were also among the key drags on the TSX as the price of bullion hit a three-week low in the face of a stronger U.S. dollar, which makes bullion more expensive for non-U.S. dollar holders.

Kinross Gold shares fell 4.6 percent to C$19.36, while Barrick Gold dropped 3.5 percent to C$37.04.

The S&P/TSX composite index fell 248.21 points, or 2.25 percent, to 10,805.33. It was the TSX's lowest level since September 3, and its fourth straight lower close.   Continued...