Toronto stock index drops sharply, U.S. benchmarks mixed

Brunilde Fioravanti
Aprile 28, 2017

Canada's main stock index fell sharply on Thursday as its heavyweight banking and energy sectors took heavy losses, with oil prices weighing and an alternative lender's troubles putting the domestic housing market in focus.

The Toronto Stock Exchange's S&P/TSX composite index finished the session down 143.07 points, or 0.91 percent, at 15,506.47.

"It's a crisis affecting a company which happens to be operating in the mortgage market", said Fred Demers, chief macro strategist at TD Securities, who did not think there was a risk of contagion such as the one experienced during the 2008-09 financial crisis. Royal Bank of Canada, the country's largest bank, shed 1.9 percent to C$93.66, while Toronto-Dominion Bank lost 2.4 percent to C$64.17 and Bank of Nova Scotia stumbled 2.7 percent to C$75.31. Seven of the index's 10 main industry groups were in the red. Ontario's provincial government earlier this month set a tax on foreign buyers amid a host of measures created to cool Toronto prices. The runaway prices have attracted comments from banks CEOs that the market could correct, which in-turn could hurt lender's earnings growth.

Canadian Natural Resources Ltd fell 3.9 percent to C$43.30 and Encana Corp also shed 3.9 percent, to C$14.15.

Fertilizer company Potash Corp of Saskatchewan gained 2.4 percent to C$23.21 after beating profit expectations and upping its outlook.

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