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TORONTO (Reuters) - Canadian stocks ended down after hitting a two-week low on Thursday, led by energy and mining shares, as investors worried about slower growth in top consumer China before a key Chinese economic report.
Investors will focus on data on China's second-quarter gross domestic product on Friday for indications of the health of the world's second-largest economy. Recent economic reports have pointed to China's expansion losing steam.
A Reuters poll showed economists expect China's growth to have slowed to 7.6 percent, its worst performance since the 2008-2009 financial crisis.
"The Canadian markets today are clearly a reflection of the concerns around what's going to come out of tomorrow's report from China," Craig Fehr, Canadian market strategist at Edward Jones in St. Louis, Missouri.
Nearly all of Canada's 10 main sectors fell. The lion's share of the drop came from the heavyweight energy and materials groups, which both declined more than 1 percent.
The biggest decliners included Suncor Energy (SU.TO), down 1.4 percent at C$28.85, Cenovus Energy (CVE.TO), which slid 2.1 percent to C$32.57, Barrick Gold (ABX.TO), down 1.4 percent at C$35.17, Potash Corp (POT.TO), which slumped 1.2 percent to C$44.75, and First Quantum Minerals (FM.TO), off 4.4 percent at C$17.06.
Markets also were disappointed by prospects for new stimulus measures in the United States. Minutes of the Federal Reserve's June meeting, released on Wednesday, showed that the fragile recovery might need to weaken further before policymakers take more action.
"We saw the same type of reaction when the markets were hoping for QE2, which they ultimately got," said Fehr. "The fact that they aren't quick to do it indicates that the economy isn't as bad as some might be expecting."
The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE finished down 119.17 points, or 1 percent, at 11,425.47. The index rebounded slightly after touching 11,366.74, its lowest level since June 28.
In Europe, fears about the world economic outlook hurt global shares on Thursday as the euro fell to a new two-year low and investors sought safe-haven U.S. government bonds.
The European Central Bank said in its monthly bulletin that growth in the 17-country bloc is weak and "heightened uncertainty" is weighing on confidence.
"Right now the majority of investors do not want to get involved with the equity markets," said John Hughes, senior mining analyst at Desjardins Securities. "Until we stabilize the situation in Europe, it's very difficult to expect we would see the beginning of any new cycle in the commodities group."
Canadian financials also suffered, falling 1.2 percent. Major lenders led the slide, with Royal Bank of Canada (RY.TO) down 1.2 percent at C$52.18 and Bank of Nova Scotia (BNS.TO) shedding 1.4 percent to C$52.32.
In other company news, Corus Entertainment Inc (CJRb.TO) shares sank 4.6 percent to C$22.25 on Thursday after the Canadian television and radio company announced it had an 11 percent fall in specialty advertising revenue in its third quarter.
One of the few positives on Thursday was TMX Group (X.TO), which edged up 0.4 percent to C$49.05 a day after a takeover of the Canadian exchange operator, which owns the TSX, cleared its final regulatory hurdles.
Editing by Kenneth Barry