August 8, 2011 / 9:03 PM / 8 years ago

CANADA STOCKS-TSX plunges over 4 pct, hits near one-year low

 * TSX tumbles 491.21 points, or 4.04 percent, to 11,670.96
 * Hits lowest since Aug. 25, 2010
 * Suffers biggest intraday slide since March, 2009
 * Cut to U.S. AAA rating shakes investor confidence
 * All 10 sectors lower, led by oil and gas  (Updates to close)
 By Trish Nixon
 TORONTO, Aug 8 (Reuters) - Toronto’s main stock index plunged to its lowest level in nearly a year on Monday, tracking a fall in world equities and commodity prices, on rising fears of a U.S. recession exacerbated by the United States’ loss of its triple-A credit rating.
 The index, which saw its biggest intraday slide since March, 2009, closed down more than 4 percent as the U.S. downgrade hammered investor confidence across the globe.
 “It’s a pretty scary day,” said Elvis Picardo, strategist and vice president of research at Global Securities in Vancouver.
 “It’s not just the ratings downgrade in the U.S. It’s also intensifying concern about the impact the ratings downgrade would have on global economic growth, and you are seeing that manifest itself in a sell-off in energy and material prices.”
 The energy sector led the index’s dive, dropping 7.21 percent as shares in oil and gas tumbled with the price of oil. Suncor Energy (SU.TO) was the most influential decliner, down 6.93 percent at C$30.10. Canadian Natural Resources (CNQ.TO) lost 6.2 percent to trade at C$33.05.  [O/R]
 The financial sector, down 3.69 percent, also weighed heavily. Royal Bank of Canada (RY.TO) down 3.1 percent at C$48.51, and Manulife Financial (MFC.TO), which shed 8.3 percent to C$12.53, were leading decliners.
 The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE closed down 491.21 points, or 4.04 percent, to 11,670.96.
 Earlier in the session it fell to 11,617.81, its biggest intraday fall in more than two years and its lowest point since Aug. 25.
 “At this point its not just concerted selling its also a big absence of buying,” added Picardo. “When you have something like this happen it usually needs a positive catalyst to bring investors back to the table.”
 Industrial metals fell sharply on Monday in a sell-off in risky assets, weighing on North American base-metal miners. [MET/L]
 But gold miners were seen as a relative safe-haven investment, with the price of bullion vaulting to a record over $1,700 an ounce. Barrick Gold (ABX.TO) was up 2.29 percent to C$45.92, topping the minority of advancers that were mostly gold miners. Goldcorp gained 2.1 percent at C$46.31 (G.TO) [GOL/]
 All told, materials, home to gold-mining stocks, were down 1.77 percent with the index’s gold subgroup helping to cushion losses, up 1.86 percent.   (Editing by Jeffrey Hodgson)                  

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