Stocks plunge on weak resources, US fears

Mon Dec 17, 2007 5:55pm EST
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By Leah Schnurr

TORONTO (Reuters) - The Toronto Stock Exchange's main index closed broadly lower on Monday due to a sharp selloff of resource issues and persistent worries over the health of the U.S. economy.

The resource-heavy materials sector led the fall, shedding 3.8 percent. The group was pulled lower by gold miners, despite a bounce in the price of the commodity.

Barrick Gold (ABX.TO: Quote) fell 89 Canadian cents, or 2.3 percent, to C$37.67, and Centerra Gold (CG.TO: Quote) was down 47 Canadian cents, or 4.1 percent, at C$10.98. The gold-mining subsector as a whole lost 4.5 percent.

The energy group declined along with the price of oil, which was hurt by the prospect that OPEC could decide to raise output when it meets in February.

Suncor Energy (SU.TO: Quote) retreated C$2.52, or 2.4 percent, to C$102.82, while the sector lost 1.9 percent.

On the upside, Husky Energy Inc (HSE.TO: Quote) gained 44 Canadian cents, or 1 percent, to C$43.53 after the company said it had finalized terms with Newfoundland to allow Husky to expand its White Rose offshore oil field.

Growing fears of inflation in the United States also weighed on the Canadian stock index and dampened investor expectations for further interest rate cuts.

The S&P/TSX composite index .GSPTSE closed down 287.12 points, or 2.1 percent, at 13,387.11 with all of its 10 main groups in negative territory.   Continued...

<p>A Toronto Stock Exchange (TSX) logo is seen in Toronto November 9, 2007. Toronto stocks were more than 100 points lower on Monday morning due to weaker commodity prices and worries about the global economic outlook. REUTERS/Mark Blinch</p>