TSX hits 1-week low on growth fears ahead of earnings

TORONTO (Reuters) - Canada's main stock index hit its lowest level in over a week on Tuesday, tracking a fall in world markets, on caution over the upcoming earnings season and prospects for global growth.

All 10 of the index's sectors fell on a wave of negative signals, including a report from the International Monetary Fund that said the global economic slowdown is worsening. The IMF cut its growth forecasts for the second time since April.

Commodity and financial shares were among the hardest hit. Barrick Gold dropped 2.8 percent to C$39.96, Suncor Energy was down 0.3 percent to C$32.91, and Royal Bank of Canada lost 0.6 percent to C$57.10.

"I think the IMF (report) is what people are paying attention to. But it struck me as being a little bit late ... current economic news coming out of the U.S. has been a little bit better rather than worse," said Ian Nakamoto, director of research at MacDougall, MacDougall & MacTier.

Europe also kept investors on edge as uncertainty about when Spain will apply for a bailout worried markets as did concerns about Greece's debt load.

At 12:43 p.m. (1643 GMT), the Toronto Stock Exchange's S&P/TSX composite index <.gsptse> was down 111.22 points, or 0.9 percent, at 12,307.77. Earlier, the TSX hit its lowest level since September 28.

The U.S. quarterly earnings season will get under way later in the day when Dow component Alcoa Inc reports after the market close.

Analysts forecast third-quarter earnings of S&P 500 <.spx> companies will drop 2.3 percent from the year-before quarter, according to Thomson Reuters data, which would be the first drop in U.S. quarterly earnings in three years.

"I think it's well advertised that earnings are going to be weak," added Nakamoto.

"So even though earnings more than likely will be down, it's a matter of how far down have investors brought share prices and what sort of guidance are they looking for."

(Reporting by Claire Sibonney; editing by Peter Galloway and Andrew Hay)

Source: http://news.yahoo.com/tsx-set-open-lower-global-growth-outlook-124544190--finance.html

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