June 6, 2011 / 9:08 PM / 8 years ago

CANADA STOCKS-Resources, banks lead TSX in steep decline

   * TSX down 199.25 points, or 1.47 pct, at 13,318.66
 * Nine of 10 main groups finish lower
 * Oils fall 2.14 pct, banks sag 1.2 pct
 * Index now down nearly 1 pct since start of year  (Updates with details, comments)
 By Solarina Ho
 TORONTO, June 6 (Reuters) - Toronto’s main stock index fell for a fifth straight session on Monday, finishing nearly 1.5 percent lower as cooling oil prices and signs of a slowing U.S. economy continued to dampen sentiment.
 Energy stocks tumbled 2.14 percent, with Suncor Energy (SU.TO) off 2.15 percent at C$38.75. It was the biggest drag on the TSX. Canadian Natural Resources (CNQ.TO) was not far behind, giving back 2.6 percent to C$39.69.
 Toronto-Dominion Bank (TD.TO) slid 1.81 percent to C$80.21 while Royal Bank of Canada (RY.TO) skidded 1.45 percent to C$54.43, pulling the economically sensitive financial group down 1.2 percent.
 The materials group reversed earlier gains to finish 1.78 percent lower. Potash Corp POT.TO gave back 1.89 percent to finish at C$52.93, while diversified miner Teck Resources TCKb.TO slumped 3.64 percent to C$49.71.
 The three groups combine to make up roughly 80 percent of the index’s weight.
 “Overall economic issues both in the U.S. as well as overseas are probably the biggest drivers of (the decline),” said Brian Pow, vice-president, research and equity analyst at Acumen Capital Partners in Calgary.
 The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE finished down 199.25 points, or 1.47 percent, at 13,318.66.
 Telecoms was the lone gainer, rising 0.11 percent.
 The index saw its biggest one-day slide since August last Wednesday and has fallen just under 1 percent since the start of the year.
 “We’re also coming into the summer doldrums — they’re not too far away. Volumes are starting to get lighter and I think most managers are trying to lock in whatever profits they’ve got,” said Pow.
 “Ultimately, people need to stand back and say, ‘Geez we’ve had an awfully strong move over the last six to eight months’, so it’s not unrealistic to expect some consolidation.”
 Last Friday, dismal U.S. jobs data rekindled worries about an economic slowdown in the United States, and dragged oil prices lower on increased fears of weaker demand. [O/R]
 Sino-Forest Corp TRE.TO, which accused short-seller Muddy Waters of defamation for alleging it fraudulently exaggerated its Chinese forestry assets, rebounded somewhat from its more than 60 percent dive last week. It ended 16.63 percent higher at C$6.10. [ID:nN06249068]
 ($1=$0.98 Canadian)  (Editing by Rob Wilson)                                        

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