UPDATE 2-Toronto stocks drop sharply as commodities fall

Fri Aug 15, 2008 4:43pm EDT
 
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(Updates figures, adds details)

* TSX index plunges to lowest close since March

* Commodity retreat drags down miners and energy companies

* Seven of ten subgroups retreat

TORONTO, Aug 15 (Reuters) - The Toronto Stock Exchange's main index plunged to its lowest level since March on Friday as resource stocks fell on retreating oil and metals prices.

The S&P/TSX composite index .GSPTSE ended the session down 262.21 points, or 2 percent, at 13,096.70. For the week, the index dropped 1.8 percent.

Oil dropped to below $114 a barrel on faltering global demand and rising supply, sliding further from its record high above $147 in July, and pulling the heavily weighted TSX energy subgroup down 3.2 percent.

The materials subgroup was even harder hit, dropping 4.2 percent on falling prices for copper, zinc, and particularly gold, which dropped below $800 an ounce for the first time since last December.

"Gold and oil seem to have locked together, pretty much. When oil comes down, gold seems to come down," said John Kinsey, a portfolio manager at Caldwell Securities in Toronto.   Continued...