September 10, 2014 / 1:48 PM / 3 years ago

TSX drops on rate concerns, fall in energy shares

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

TORONTO (Reuters) - Canada’s main stock index declined on Wednesday, weighed down by worries that U.S. interest rates might rise and by a drop in energy shares spurred by lower oil prices.

Concerns about the Scottish referendum on independence, which is set for next week, further dampened the mood.

Investor speculation about when the U.S. Federal Reserve will raise interest rates grew more intense ahead of a Fed meeting next week, after which the U.S. central bank is expected to shed more light on its policy outlook.

Oil prices, which have been slipping for the past three months, were hit again by worries over increasing supply and sluggish demand.

“A sense of heightened geopolitical risk is contributing to invest nervousness,” said Elvis Picardo, strategist and vice president of research at Global Securities in Vancouver.

“We might be in for a bout of volatility in the short term,” he added.

The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE closed down 64.92 points, or 0.42 percent, at 15,471.89. Eight of the 10 main sectors on the index were in the red.

Shares of energy producers dropped 0.6 percent, with Suncor Energy Inc (SU.TO) losing 1.1 percent to C$43.18, and Talisman Energy Inc TLM.TO shedding 1.6 percent to C$10.77.

The industrial sector declined 0.7 percent. Canadian Pacific Railway Ltd (CP.TO) fell 1.2 percent to C$223.59, and Canadian National Railway Co (CNR.TO) slipped 1 percent to C$79.98.

Editing by Peter Galloway

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