UPDATE 2-Toronto stocks sag amid resources, economic woes

Wed Jul 2, 2008 1:24pm EDT
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(Updates to mid-afternoon)

*TSX tumbles in broad retreat

*Coal companies stung by decline in coal price

*Pessimism over economic outlook weighs

TORONTO, July 2 (Reuters) - The Toronto Stock Exchange's main index retreated sharply on Wednesday as coal producers fell in tandem with the price of the commodity and weak U.S. economic data added to a darkening global outlook.

Swinging in a wide breadth after initially climbing 100 points at the open, the index was led lower by declines in resource companies. Fording Canadian Coal Trust FDG_u.TO was among the biggest losers as the price of U.S. benchmark coal slumped, echoing a European sell-off.

The heavyweight energy sector also sagged despite a gain for the price of oil, amid investor angst over the impact of high commodity prices on the economy and how long recent soaring levels can last.

"I think it's just the general economic outlook for the second half of the year that would say we're not out of our troubles, and it's going to take longer to sort itself out than anyone expected," said Brian Pow, vice-president, research and equity analyst at Acumen Capital Partners, in Calgary.

The S&P/TSX composite index .GSPTSE was down 249.63 points, or 1.7 percent, at 14,217.40 by mid-afternoon with all but two of its 10 main sectors looking down. Immediately after the open, the index climbed as high as 14,584.85 after being closed on Tuesday for the Canada Day holiday.   Continued...