(Updates numbers, adds details, quotes)
TORONTO, Dec 18 (Reuters) - The Toronto Stock Exchange’s main index fell into negative territory on Tuesday, erasing the morning’s gains in a broad slump led by financial and materials issues.
The index had earlier climbed as high as 13,535.93, helped by strong commodity prices, but the materials sector slipped as investors worried that a potential slowdown in global growth could dampen demand for resources.
The heavyweight financial sector lost 1 percent with Canadian Imperial Bank of Commerce (CM.TO) down C$1.81, or 2.4 percent, at C$72.33 and Bank of Nova Scotia (BNS.TO) off 70 Canadian cents, or 1.4 percent, at C$50.41.
Peter Chandler, senior vice-president at Canaccord Capital in Waterloo, Ontario, said that worries about the fallout of the credit crunch and global economic growth were among factors hampering the market.
“There’s ongoing concern about the credit crunch and the spillover fallout that’s happened, and more anxiety about what hasn’t happened that may happen yet, particularly as it relates to the financial services industry,” Chandler said.
Also in financials, Toronto-Dominion Bank (TD.TO) dipped 42 Canadian cents, or 0.6 percent, to C$70.20 the day after it said it will consider steps to help fix Canada’s third-party asset-backed commercial paper market but didn’t believe it should shoulder a burden it didn’t create.
The S&P/TSX composite index .GSPTSE was down 83.29 points, or 0.62 percent, at 13,303.82 in the early afternoon, with eight of the TSX’s 10 main groups in negative territory.
In the United States, markets also tumbled as Goldman Sachs Group Inc’s (GS.N) earnings did not reassure investors that the worst of the credit market fallout was past.
The TSX’s decline follows Monday’s steep 287-point drop on a selloff in resource issues and nagging worries over the health of the U.S. economy.
On the upside, Quebecor World IQW.TO gained 23 Canadian cents, or 14.7 percent, to C$1.80 after a newspaper report that two printing companies and two North American private equity firms were among those eyeing the Canadian printer.
$1=$1.01 Canadian Reporting by Leah Schnurr; Editing by Rob Wilson