UPDATE 3-Toronto stocks sag as resources, financials weigh

Mon Jan 7, 2008 5:32pm EST
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By Leah Schnurr

TORONTO Jan 7 (Reuters) - The Toronto Stock Exchange's main index sank on Monday for the second session in a row as resource and financial issues helped drag the market broadly lower.

The index trimmed some of its losses -- it was down more than 200 points early in the day -- but it still extended Friday's decline as fears of a recession in the United States also weighed.

Falling oil and gold prices, and worries over the prospect of a global economic slowdown helped drag the energy and materials sectors down 1.2 percent and 1.5 percent respectively.

Suncor Energy (SU.TO: Quote) fell C$1.32, or 1.2 percent, to C$108.35, and Barrick Gold (ABX.TO: Quote) was down 48 Canadian cents, or 1 percent, at C$47.48.

The financial sector was off 0.7 percent. Toronto-Dominion Bank (TD.TO: Quote) fell following rumors in foreign exchange markets that it could be hit with a multibillion-dollar writedown. TD repeated that it has no exposure to the troubled U.S. subprime market, but finished down C$1.46, or 2.2 percent, at C$65.66.

"When it comes to the financials, investors are in the mood to sell first and ask questions later," said Elvis Picardo, investment strategist at Northern Securities Inc in Vancouver.

"That has been trend for the past few months and with this subprime mortgage mess in the U.S. showing no signs of abating, it's not surprising to see those stocks trade a little bit to the downside today."   Continued...