*TSX drops 256.08 points, or 2.2 percent, to 11,582.21
*Energy and bank shares lead TSX lower
*Gloomy U.S. Federal Reserve comments spark selloff (Adds company news)
By Jennifer Kwan
TORONTO, Aug 11 (Reuters) - Toronto’s main stock index fell to its lowest level in nearly three weeks on Wednesday as worries about global growth dragged down commodity-linked shares.
Suncor Energy (SU.TO) tumbled 4 percent to C$33.34 and fellow oil company Canadian Natural Resources (CNQ.TO) dropped 3.9 percent to C$34.71, hurt by a slide in oil prices to around $78 a barrel. [O/R]
The index’s materials sector fell as copper prices tumbled to their lowest level in two weeks as investor confidence crumbled on renewed worries about growth prospects in the United States. [MET/L] Teck Resources TCKb.TO skidded 4 percent to C$34.61.
The TSX followed global markets lower as the U.S. Federal Reserve’s gloomier assessment of the economy on Tuesday rattled investor confidence, and its measures to support recovery in the United States failed to satisfy. [.N] [ID:nN09275781]
The Fed’s assessment was followed by a pessimistic outlook from the Bank of England on Wednesday as well as by data that showed softening domestic demand in China and growing trade deficits in Canada and the United States. [ID:nLDE67A15M] [ID:nTOE67A01A] [ID:nN15446129] [ID:nN11208864]
“I think the scenario of slowing global growth is back again on the table,” said Elvis Picardo, analyst and strategist at Global Securities in Vancouver.
“Adding to the concerns about slowing global growth was the Bank of England statement today where it took its growth forecast for the U.K. down a little bit. And data from China that shows the pace of expansion is slowing a little bit.”
The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE closed the session down 256.08 points, or 2.2 percent, at 11,582.21, with all of its 10 main groups in the red. Earlier, the index fell as low as 11,565.03, its weakest level since July 22.
Among economically sensitive financial shares, Royal Bank of Canada (RY.TO), the country’s biggest lender, was down 2.4 percent at C$52.06. Toronto-Dominion Bank (TD.TO) fell to C$71.72, also down 2.4 percent. Manulife Financial (MFC.TO), which was among the most heavily traded stocks on the TSX, fell 4.3 percent to C$13.41.
In earnings, Rona Inc RON.TO, Canada’s biggest home improvement chain, said its earnings rose nearly 12 percent. However, its shares fell 5.6 percent to C$13.45 as the results fell below expectations. [ID:nN11221593]
Quarterly earnings at Metro Inc’s MRUa.TO, Canada’s No. 3 grocer, climbed 6.6 percent, helped by improved operations and higher revenue. Metro fell 1 percent to C$43.35.
Research In Motion RIM.TO was up 1.7 percent at C$58.78. The BlackBerry maker was in the spotlight on speculation that it had reached a deal to keep its service going in Saudi Arabia. [ID:nN09103593] However, sources said India may temporarily shut down BlackBerry services if security concerns are not addressed in a meeting on Thursday. [ID:nSGE67A09E]
The blue chip S&P/TSX 60 index .TSE60 closed 15.75 points, or 2.28 percent, lower at 676.40.
$1=$1.05 Canadian Reporting by Jennifer Kwan; editing by Peter Galloway