UPDATE 2-Toronto stock index hits lowest point in 4 years

Thu Oct 16, 2008 12:03pm EDT
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* Market swings erratically on investor jitters

* Materials sector down 11 pct, oil group off 6 pct

* Index is down more than 20 percent since end September

(Adds details)

TORONTO, Oct 16 (Reuters) - The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE was sharply lower late on Thursday morning after falling to its lowest level in four years as jittery investors weighed the risk of recession as commodity prices weakened.

Softening resource prices put yet another chill on the index's heavily-weighted energy and materials sectors, pushing the index down more than 100 points minutes after the opening bell. But it then reversed course and raced nearly 200 points higher, only to see all 10 main sectors quickly turn negative again, dropping more than 500 points at one point.

Shortly after 11:30 a.m. (1530 GMT), the S&P/TSX composite index .GSPTSE was down 489.84 points, or 5.25 percent, at 8,834.01.

A 10.5 percent drop in the materials sector, which includes miners and fertilizer issues, led the decline. The gold-mining subindex sagged 11 percent, with Barrick Gold (ABX.TO: Quote) off 12 percent at C$29.20, and Agnico-Eagle down 15.4 percent at C$39.94.

The composite index is down more than 20 percent since September. It has now erased the record burst higher at the start of this week that had helped make up for last week's 16-percent drop.   Continued...