* TSX rebounds, up 0.43 percent at 7,720.71
* Energy, materials lead charge higher
* Bank of Canada cuts rates to record low 0.5 pct (Updates to midafternoon, adds quote)
TORONTO, March 3 (Reuters) - Toronto’s main stock market index rebounded into positive territory on Tuesday afternoon, struggling higher after touching its lowest level in more than five years, helped up by strength in resource issues.
The heavily weighted energy and materials sectors led the charge, rising 1.7 percent and 2.8 percent, respectively, with Suncor Energy (SU.TO) up 7 percent at C$25.41 and Goldcorp (G.TO) ahead 4.5 percent to C$36.39.
At midafternoon, the S&P/TSX composite index .GSPTSE was up 33.20 points, or 0.43 percent, at 7,720.71, with four of its 10 main groups higher. Earlier in the day, the index dropped 2.4 percent, touching its lowest level since October 2003.
“We are groping for a low here,” Ron Meisels, technical analyst and president of Phases & Cycles in Montreal, said of the earlier selloff.
“The people who are looking at the market are now hoping and praying that the recent lows will hold.”
However, there is a probability the market has further to fall, he said.
“The time when we will hit a low is when everybody finally throws in the towel, when everybody has fear. We don’t see that yet,” he said.
Most of the pressure throughout the day came from the big financials sector, which dropped 1.4 percent.
The drop came even after the last two of Canada’s six largest banks -- Bank of Nova Scotia (BNS.TO) and Bank of Montreal (BMO.TO) -- reported quarterly results that showed they remained profitable even as the global financial crisis raged, but that bad loans were on the upswing. [ID:nN03459519]
Shares of Bank of Nova Scotia rose 2.4 to C$27.69, while Bank of Montreal climbed 3.3 percent to C$27.87.
The earlier drop in the market also came after the Bank of Canada cut its benchmark rate to a record low of 0.5 percent and signaled that it may take extra steps to pump money into a system that remains stubbornly short of credit. [ID:nN03241]
$1=$1.29 Canadian Reporting by Jennifer Kwan; editing by Rob Wilson