November 23, 2011 / 7:00 PM / 7 years ago

CANADA STOCKS-TSX dives on weak global data, German fears

   * TSX down 170.36 pts, or 1.4 pct, at 11,624.83
 * Materials, energy sectors lead index losses
 * Chinese economic data weighs  (Adds details, analyst’s comment)
 By Jon Cook
 TORONTO, Nov 23 (Reuters) - Toronto’s main stock index sank as much as 2 percent on Wednesday as resource issues tumbled on soft economic data from the United States, China and Europe, and on fears euro zone debt contagion had spread to Germany.
 A slowdown in Chinese and European manufacturing, coupled with a poor sale of German bonds, higher U.S. jobless numbers and flat consumer spending, sparked fears of a global slowdown. [MKTS/GLOB] [ID:nL5E7MN1M4] [ID:nN1E7AM0EH]
 “It’s ugly,” said Sal Masionis, a stockbroker at Brant Securities. “You really have two punches in one day; it’s very very serious.”
 At 1:26 p.m. (1826 GMT), the Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE was down 170.36 points, or 1.4 percent, at 11,624.83, after falling as low as 11,540.23 earlier in the day. That was the TSX’s lowest level since Oct. 6.
 Commodities took it on the chin, with prices for oil, gold, and copper and other base metals falling sharply, sending energy and materials shares spiraling downward. [ID:nL4E7MN1O1]
 Energy stocks fell nearly 3 percent. [O/R] with Suncor Energy (SU.TO) sliding more than 3 percent to C$29.38, leading the oil and gas retreat.
 Heavily weighted materials issues were pulled lower by plunging gold prices, which dropped more than 1 percent as the intensifying euro zone debt crisis pushed up the safe-haven appeal of the U.S. dollar. [GOL/]
 Miner Goldcorp Inc (G.TO) was the biggest decliner, dropping 2.3 percent to C$51.23.
 A fall in copper and base-metals prices, spurred by a big contraction in Chinese factory activity, pushed base-metals miners down by more than 2 percent. [ID:nL4E7MN20U]
 Teck Resources Ltd TCKb.TO was among the hardest hit mining stocks, falling 3 percent to C$33.38.
 The index’s financial sector sputtered after a surprisingly weak sale of German bonds ignited fears that Europe’s debt crisis was now contaminating the euro zone’s strongest economy. [ID:nL5E7MN3J8]
 Royal Bank of Canada (RY.TO) fell 1.9 percent to C$44.07, and Bank of Nova Scotia (BNS.TO) was down 2.2 percent at C$48.86.
 “We’ve had a slew of these news items on the macro front that are weighing quite heavily and even any one of these in isolation on a given day like today would set a negative tone for the market,” said Garey Aitken, chief investment officer for the Bissett Canadian Equity Fund.
 Aitken, who manages more than $7 billion in funds, said the European crisis was the biggest cause of the dive in “economically sensitive” materials, energy and industrial stocks.
 “There’s just more and more fatigue and frustration on the part of market participants when they look at this sovereign debt problem in Europe,” Aitken said. “There’s a lot of talk and not enough action.”
 ($1=$1.05 Canadian)  (Editing by Peter Galloway)                 

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