TSX declines as crude oil prices slide Scotiabank takes big Q4 charge

TORONTO — The Toronto stock market plunged almost 200 points on Tuesday, before recovering some of those losses in afternoon trading, as energy stocks sustained significant losses following a move by Saudi Arabia to cut prices to its U.S. customers sent oil reeling to four-year lows.The December crude contract in New York fell $2.25 to US$76.53 a barrel after Saudi Arabia made the price cut. BMO Capital Markets senior economist Robert Kavcic said the move added “to speculation that Middle East producers are working to defend market share amid surging U.S. output.”Prices have also been pushed downward by a U.S. dollar that has gained in strength lately as the U.S. Federal Reserve’s quantitative easing program concluded at the end of October.The TSX energy sector fell 4.5 per cent. Major losers included Athabasca Oil, which plunged 12.5 per cent to $3.06 while Canadian Natural Resources dropped 4.5 per cent to $36.55.Falling oil prices and dovish comments Monday by Bank of Canada governor Stephen Poloz pushed the Canadian dollar down 0.41 of a cent to a five-year low of 87.64 cents US.Energy stocks also punished U.S. indexes as the Dow Jones industrials dropped 81.81 points to 17,284.43, the S&P 500 fell 16.35 points to 2,001.46 while the Nasdaq declined 41.55 points to 4,597.36.Oil prices drop to 3-year low as Saudi Arabia cuts crude prices againCanadian dollar tumbles to below 88 cents as oil prices slumpThe major corporate story of the morning involved Scotiabank, which announced that it’s cutting 1,500 jobs companywide — about two-thirds of them in Canada.It’s posting a $341 million after-tax charge for the fourth quarter which will reduce earnings by 28 cents a share. Part of that is for severance costs but Scotiabank is also taking a number of other steps, including an additional $109 million of loan loss provisions related to the Caribbean region. It will also write down the value of its investment in a Venezuelan bank by $129 million and take a $47 million charge related to unremitted dividends from Banco del Caribe in Venezuela. Its shares lost $1.30 to $67.48.Elsewhere on the TSX, other resource sectors registered sharp losses amid data showing the eurozone economy in precarious shape. The European Commission has cut its growth forecast, saying growth will come in at 0.8 per cent this year, down from 1.2 per cent growth it forecast this spring.The base metals sector lost three per cent with December copper down five cents to US$3.01 a pound.The gold sector was down 0.2 per cent while December gold inched up 50 cents to US$1,170.3 an ounce.The TSX found some strength from consumer staples and telecoms.In other corporate news, TransCanada Corp. reported a third-quarter profit of $457 million or 64 cents per share on $2.45 billion in revenue. That compared with a profit of $481 million or 68 cents per share on $2.20 billion in revenue a year ago. On a comparable basis, the company said it earned $450 million or 63 cents per share for its latest quarter, two cents ahead of estimates and its shares gained 39 cents to $55.42.WestJet Airlines says its quarterly net income excluding losses from the sale of old aircraft surged 31 per cent to a record $85.4 million. The airline earned 66 cents per diluted share in adjusted profits, two cents short of analyst estimates. Its shares declined 85 cents to $31.18.