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* TSX down 160.42 points, or 1.1 pct, at 14,092.35
* All 10 sectors weaker; energy, materials drag
* U.S. oil futures end above $105 a barrel
* Gold hits record above $1,440, silver highest since 1980 (Updates to close, adds details, comments)
By Claire Sibonney
TORONTO, March 7 (Reuters) - Toronto's main stock index closed sharply lower on Monday, after nearing a three-year high, on fears that rising oil prices and instability in Libya and the Middle East would damage the global economic recovery.
The index's energy sector ended down 1.5 percent, retreating from an early rally, as escalating violence in Libya and rumors that leader Muammar Gaddafi was seeking an exit deal contributed to a volatile day for oil prices. Still, U.S. crude futures settled higher, above $105 a barrel. [O/R]
"The global macro environment seems to have entered a new phase of uncertainty and that could have triggered a bout of profit-taking on the TSX," said Elvis Picardo, an analyst and strategist at Global Securities in Vancouver, noting the TSX hit a 32-month high shortly after the open.
Picardo said the uncertainty is measured by the fact that both energy and gold mining issues were down sharply despite oil prices well north of $100 a barrel and gold reaching a record above $1,400 an ounce. [GOL/]
Suncor Energy (SU.TO) dropped 1.8 percent to C$45.57, and Canadian Natural Resources (CNQ.TO) plunged 3.2 percent to C$48.10.
The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE ended down 160.42 points, or 1.13 percent, at 14,092.35. Earlier in the session, it rose as high as 14,329.49, its highest level since July 2008.
All of the index's 10 main sectors were weaker.
The materials sector, home to base-metal miners and fertilizer producers -- both proxies for economic growth -- finished down 1.3 percent, as the price of copper suffered its biggest one-day decline in nearly four months. [MET/L]
Potash Corp (POT.TO) tumbled 3.2 percent to C$57.49, and diversified miner Teck Resources TCKb.TO lost almost 3 percent at C$52.53.
Precious metals miners also shifted from gains to losses, tracking swings in oil, as the price of gold climbed into record territory and silver hit its highest point since 1980.
The subsector was off 0.6 percent as Goldcorp (G.TO) slipped 0.2 percent to C$48.62 percent. However, Barrick Gold Corp (ABX.TO) rose 0.3 percent to C$51.53 and Silver Wheaton SLW.TO advanced 0.2 percent to C$43.74.
($1=$0.97 Canadian) (Reporting by Claire Sibonney; editing by Rob Wilson)