November 23, 2010 / 9:52 PM / 8 years ago

CANADA STOCKS-TSX tumbles on Korea, euro zone woes

* TSX slides 135.26 points to 12,793.75

* Nine of 10 main groups lower

* Utilities group ekes out 0.2 percent gain (Adds details, quote)

By Jennifer Kwan

TORONTO, Nov 23 (Reuters) - Toronto’s main stock index ended sharply lower on Tuesday as tensions in the Korean peninsula and euro zone debt concerns pushed down heavily weighted commodity-linked shares.

Toronto stocks followed global equities lower, with energy shares, down 1.6 percent, among the hardest-hit groups on the resource-heavy index. [O/R]

Key decliners included Suncor Energy (SU.TO), off 2.7 percent at C$33.95, and Canadian Natural Resources (CNQ.TO), down 2.2 percent at C$39.10. Encana Corp (ECA.TO) dropped 1.6 percent to C$28.50.

Investor sentiment was shaken as North Korea fired dozens of artillery shells at a South Korean island in one of the heaviest attacks on its neighbor since the Korean War ended in 1953. [ID:nL3E6MN0MA]

The incident hit global financial markets that were already unnerved by fears that a rescue package for Ireland might not stop problems from spreading to other indebted euro zone countries. [MKTS/GLOB]

“You now have a new variable added to the mix and that’s geopolitical risk. That’s on account of the news of some skirmishes between North and South Korea,” said Elvis Picardo, analyst and strategist at Global Securities in Vancouver.

“Anything that is negative for global growth has a direct impact on commodity prices and, by extension, the TSX.”

The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE ended the day down 135.26 points, or 1.05 percent, at 12,793.75. Nine of the TSX’s 10 main sectors were lower.

Utilities managed to eke out a 0.2 percent gain as investors were attracted to above average dividend yields during turbulent times, Picardo said.

Gold miners were also on the rise as investors flocked to the safe-haven precious metal, he said. [GOL/]

That helped limit the fall in the index’s materials group to 0.6 percent. The group came under pressure from weak prices for metal prices, including copper. [GOL/] MET/L]

Barrick Gold (ABX.TO) rose 1.7 percent to C$51.95, while Agnico-Eagle (AEM.TO) rose 0.1 percent to C$80.30.

Diversified miner Teck Resources TCKb.TO skidded 4 percent to C$48.82.

The blue chip S&P/TSX 60 index .TSE60 closed 8.49 points, or 1.15 percent, lower at 732.12.

In company news, Canada’s Alimentation Couche-Tard (ATDb.TO), up 2.7 percent at C$25.95, posted a stronger-than-expected increase in quarterly earnings and raised its dividend by 25 percent.

It also said it will seek new opportunities to expand its convenience store network, undeterred by the collapse of its $2 billion takeover bid for a U.S. competitor this fall. [ID:nN23142342]

Sun Life Financial (SLF.TO), down 2.3 percent at C$27.95, said it plans to expand its operations in China and India to capitalize on the insurance and investment needs of a growing middle class in the two countries. [ID:nN23136538]

$1=$1.02 Canadian Reporting by Jennifer Kwan; editing by Peter Galloway

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