UPDATE 2-Toronto stock index sinks as resources weigh

Tue Sep 2, 2008 10:54am EDT
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*Price of crude sinks as Gustav fears ease

*Financials, consumer stocks rise on oil's fall

*Couche-Tard to report first-quarter results

(Adds details)

TORONTO, Sept 2 (Reuters) - The Toronto Stock Exchange's main index was sharply lower on Tuesday, yanked down by energy and materials stocks, as crude tumbled after Hurricane Gustav spared major U.S. Gulf oil facilities, and metal prices sagged.

The benchmark index's key energy sector fell 5 percent as oil retreated to around $109 a barrel, fighting back from earlier lows, as fears eased over Hurricane Gustav's wrath on U.S. Gulf oil facilities.

Materials, home to resource shares, fell 4.7 percent as U.S. gold futures tumbled 4 percent on oil's retreat and as the U.S. dollar strengthened, while some base metals also sagged.

"In a word it is commodities," said Keith Summers, chief investment officer at Stonegate Private Counsel. "The bear market is continuing."

At midmorning, the S&P/TSX composite index .GSPTSE was down 236.83 points, or 1.7 percent, at 13,534.42, with five of its 10 main groups lower. The market was closed for the Labor Day holiday on Monday.   Continued...