UPDATE 3-Toronto stocks slump in broad retreat

Wed Jul 9, 2008 4:58pm EDT
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(Updates closing numbers, adds details)

* TSX retreats into official correction

* Financials hit by worries over credit crunch

* Concerns over outlook for second-quarter results

TORONTO, July 9 (Reuters) - A late day retreat pulled the Toronto Stock Exchange's main index into an official correction on Wednesday, as it dropped almost 200 points amid worries over the economic outlook and weaker second-quarter results.

The large financial sector was down 2.8 percent as persistent worries spilled over from the United States on further impact from the credit crunch.

Energy shares, which had earlier helped lift the main index, retreated as the price of oil cut gains to settle just a penny higher after climbing more than $2.

Rick Hutcheon, president and chief operating officer at RKH Investments, said that results for the second quarter are expected to be weak, but if they come in better than expected, the market could stage a rally.

"I think we're going to be on tenterhooks until we get a little further into the earnings season," said Hutcheon.   Continued...