UPDATE 1-Toronto stocks tumble amid inflation worries

Thu Jun 19, 2008 11:07am EDT
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(Updates to midmorning)

* Inflation concerns weigh on banking issues

* Energy shares tumble along with oil prices

* Gold producers buoyed by gain in bullion prices

TORONTO, June 19 (Reuters) - The Toronto Stock Exchange's main index sagged on Thursday morning, as energy shares fell while oil tumbled and a jump in inflation underscored concerns over the risks facing the economy.

A $3 retreat in the price of oil knocked the heavyweight energy sector down 1.6 percent, after China said it will raise retail gasoline and diesel prices.

Among the biggest drags, Suncor Energy (SU.TO: Quote) gave up C$1.63, or 2.4 percent, to C$65.22, while Canadian Natural Resources (CNQ.TO: Quote) slid C$1.74, or 1.6 percent, to C$107.96.

Losses in financial and consumer shares also undercut the benchmark as an increase in Canadian consumer prices highlighted worries over the impact of rising energy prices.

Consumer prices rose 2.2 percent last month due to a sharp increase in gasoline prices. The increase of 1 percent from April to May was the single largest monthly rise since January 1991.   Continued...