TORONTO - The Toronto stock market is likely heading for another negative week as fresh corporate earnings reports come out and investors avoid financial stocks on worries about more big losses and writedowns.
They will also be interested to see how the Conservative government in Ottawa plans to deal with what is expected to be a steep recession when it hands down its budget on Tuesday.
The prime minister and finance minister prepared the public for huge deficits and a senior official said last week that there will be back-to-back annual deficits of $34-billion and $30-billion.
The TSX finished down 292 points or 3.25 per cent last week, with declines led by the financial sector as investors were particularly spooked by Royal Bank of Scotland, which saw its stock plunge to about 14 cents US, a far cry from the US$4.20 range it traded in just a year ago.
"I think the RBS story took a lot of people by surprise," said Andrew Pyle, investment adviser at Scotia McLeod in Peterborough, Ont.