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TSX ends down 1.4% at 22,859.46

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Posts lowest closing level since September 6

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Energy falls 2%; oil settles 2.1% lower

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Financials decline 2%

(Updates at market close)

By Fergal Smith

April 7 (Reuters) - Canada's main stock index fell on

Monday to a seven-month low, including declines for energy and

financial shares, as a widening trade war threatened to derail

the global economy and despite the prospect of negotiations that

could lead to deals.

Toronto Stock Exchange's S&P/TSX composite index

ended down 334.01 points, or 1.4%, at 22,859.46, adding to steep

declines on Thursday and Friday and posting its lowest closing

level since September 6.

The index has fallen 11.4% since posting a record closing

high on January 30. That's a magnitude that puts it in

correction territory but a smaller pullback than for some other

major indexes, such as the S&P 500.

U.S. President Donald Trump said he was not looking at a

pause on tariffs to allow for negotiations with trading partners

but said he would talk to China, Japan and other countries about

the duties.

"It looks like deals are going to be made, which is a

positive, yet the market is not sure," said Allan Small, senior

investment advisor of the Allan Small Financial Group with iA

Private Wealth.

Energy was down 2% as the price of oil extended

its recent declines, settling 2.1% lower at $60.70 a barrel, on

worries that tariffs could push economies around the world into

recession.

Heavily weighted financials also lost 2%, with Great-West

Lifeco Inc ( GWLIF ) down 5.1%.

Consumer staples ended 2.8% lower. Shares of Loblaw

Companies Ltd ( LBLCF ) declined 3.2%, extending their pullback

from a record high on Thursday.

The probability of a U.S. recession has risen significantly

thanks to Trump's tariffs and that will have a major negative

effect on the Canadian economy, Prime Minister Mark Carney said.

Canadian firms and consumers see a sharply higher chance of

recession over the coming year as U.S. tariffs and possible

retaliation fuel widespread uncertainty, the Bank of Canada

said.