UPDATE 6-Toronto stocks battered by weak resource issues

Tue Sep 2, 2008 5:27pm EDT
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* TSX dives more than 470 points in broad selloff

* Index logs biggest percentage decline since January

* Resources fall along with commodity prices (Adds details, quotes)

By Leah Schnurr

TORONTO, Sept 2 (Reuters) - The Toronto Stock Exchange's main index was hammered by a selloff in resources on Tuesday, plunging more than 3 percent as commodity prices fell, marking its worst day in more than seven months.

The heavyweight energy sector led the slide as oil prices slid on fading concerns over the impact from Hurricane Gustav on the U.S. oil industry.

Oil settled down $5.75 at $109.71 a barrel as reports suggested oil installations in the Gulf of Mexico had weathered the storm with only minor damage. Suncor Energy SU.TO fell 9.6 percent to C$54.91.

The resource-laden materials sector also yanked the Toronto index lower, as it was hurt by falling prices of gold and other metals, which followed oil's example. Inmet Mining IMN.TO slid 7 percent to C$59.50.

"Gustav was supposed to be a stronger impersonation of Katrina, and it got gradually downgraded, and apparently expected damage is fairly minimal, so obviously that's hurting the energy sector," said Levente Mady, a broker at MF Global Canada in Vancouver.   Continued...