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Financials hits over two-month low
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Miners a bright spot
(Updates prices, adds comments and details)
By Shashwat Chauhan
March 13 (Reuters) - Canada's main stock index hit a two-month low on
Monday, with banks and energy stocks leading declines, as global investors
turned away from riskier assets on worries about the abrupt shutdown of Silicon
Valley Bank (SVB).
The Toronto Stock Exchange's S&P/TSX composite index fell 172.4
points, or 0.87%, to 19,602.52 by 10:07 a.m. ET (1407 GMT).
Mirroring weakness in global financial stocks, Canada's banks dropped 2.3% to hit a more than two-month low. The declines came even as U.S. authorities launched emergency measures on Sunday to shore up confidence in the banking system after the failure of SVB threatened to trigger a broader financial crisis. A Canadian banking regulator on Sunday said it was taking temporary control of the beleaguered bank's unit in the country. "The actions taken by the U.S. regulators do give comfort to depositors at some of these U.S. banks that their funds are safe," said Travis Irwin, portfolio manager, small cap equities at Picton Mahoney Asset Management. "They did take drastic actions there, but what they did fall short of... bailing out the banks themselves." Energy stocks fell 2.9% as oil prices slid more than 4%. Oil prices along with equities fell as the collapse of SVB raised fears of a fresh financial crisis, but a recovery in Chinese demand provided support. "Investors are trying to assess the economic damage that these bank failures could have on the economy and as a result, you are seeing economically sensitive commodities like oil and copper trade lower," added Picton Mahoney's Irwin. The TSX has shed most of its year-to-date gains on the back of recent underperformance in banks and commodity-linked stocks. The index is now up just 1% so far this year.
Bucking the trend, the materials sector , which includes precious and base metal miners and fertilizer companies, gained 1.8% as gold and silver prices gained against a softer dollar. (Reporting by Shashwat Chauhan in Bengaluru; Editing by Shailesh Kuber)
