October 1, 2008 / 2:07 PM / 10 years ago

UPDATE 1-Toronto stocks down on oil dip, awaits bailout vote

(Adds details)

*TSX slips at open after Tuesday’s 4 pct rally

*Energy sector falls 1.5 percent as oil slides

*Teck shares down 3.6 percent as BMO adjusts target

TORONTO, Oct 1 (Reuters) - The Toronto Stock Exchange’s main index opened lower on Wednesday on falling oil prices, while investors await a key vote by the U.S. Senate on the revised $700 billion bailout for the financial industry.

The soft opening comes after a 4 percent rally on Tuesday amid renewed hopes a rescue deal would come this week.

But jitters crept back into markets ahead of a key vote by Senate, which is expected at 7:30 p.m., while Congress is scheduled to debate the plan on Thursday.

The package, which was rejected on Monday and sparked a global market rout, would allow the U.S. Treasury to mop up bad mortgage-related assets from banks to defrost credit markets and help stem the crisis that has taken down some iconic Wall Street firms.

The energy group, which staged a comeback on Tuesday after a big 10.6-percent tumble at the start of the week, led the way down, falling 1.5 percent, as oil fell below $99 a barrel ahead of weekly U.S. oil inventory data, which is expected to show a rise in crude stockpiles. [ID:nSYD174896]

Shortly after 9:45 a.m., the S&P/TSX composite index .GSPTSE was down 56.81 points, or 0.5 percent, at 11,696.09, with half of the 10 main groups lower.

The financial services sector fell 0.7 percent with Royal Bank of Canada (RY.TO) down 1.8 percent at C$49.60.

Materials were up 1 percent, boosted by Potash Corp of Saskatchewan Inc POT.TO, which rose 1.5 percent to C$139.99, while Teck Cominco Ltd TCKb.TO was down 3.6 percent at C$29.13.

BMO Capital Markets cut Teck shares to “underperform” from “market perform” and reduced the price target for the company to C$30 from C$45. [nWNAB4360]

On Tuesday, Fording Canadian Coal Trust FDG_u.TO unitholders approved a $14 billion takeover by Teck. [nN30448639].

In the oil sector, Suncor Energy (SU.TO) fell 3.6 percent to C$42.41, while Canadian Natural Resources (CNQ.TO) was down 2.5 percent at C$71.16. ($1=$1.06 Canadian) (Reporting by Jennifer Kwan; Editing by Scott Anderson)

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