TSX dives below 14,000 on Libya turmoil

Tue Feb 22, 2011 5:32pm EST
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By Solarina Ho

TORONTO (Reuters) - Toronto's main stock index fell steeply on Tuesday as unrest in Libya and elsewhere in the Middle East shook investor confidence.

Nearly all of the index's main groups suffered heavy losses, with the materials and financial groups suffering some of the biggest falls, down 2.54 percent and 1.38 percent, respectively. Most other groups fell more than 1 percent.

Fertilizer producer Potash Corp took the biggest hit, falling 5.34 percent. Manulife Financial dropped 4.07 percent to C$18.14, while diversified miner Teck Resources declined for a fifth straight session, tumbling 4.16 percent to C$52.07.

World stock markets fell as Libyan leader Muammar Gaddafi signaled defiance of a revolt against his 41-year rule. He appeared on state television and denied he had fled the country. The turmoil fueled a flight from risky assets.

"There's a whole lot of uncertainty. If there's one thing that unnerves markets it's not knowing what the news is," Peter Chandler, senior vice-president and director at Canaccord Wealth Management.

The Toronto Stock Exchange's S&P/TSX composite index closed down 159.43 points, or 1.13 percent, at 13,963.68.

The index fell after a stellar run that saw it surge above the 14,000 mark for the first time since July 2008.

"As far as the general theme is concerned, the unrest in the Middle East is spreading and markets worldwide are pretty nervous," said Levente Mady, market strategist at Union Securities in Vancouver.   Continued...