UPDATE 4-Toronto stocks stung by U.S. bailout uncertainty

Mon Sep 22, 2008 5:16pm EDT
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*TSX falls on uncertainty over U.S. bailout plan

*Worries over plan spark broad retreat

*Gold producers rally along with price of bullion

(Adds details, quotes)

By Leah Schnurr

TORONTO, Sept 22 (Reuters) - The Toronto Stock Exchange's main index tumbled more than 2 percent in choppy action on Monday in a broad retreat on uncertainty over the effectiveness of the proposed $700 billion U.S. financial bailout plan.

The lone group to make gains was the materials sector, pushed up by gold producers as bullion prices rose on the commodity's safe-haven allure and the weaker U.S. dollar. Among gainers, Goldcorp (G.TO: Quote) was up 9.8 percent at C$37.89.

But the broader market was rattled by concerns over how much the U.S. government's plan to take over sour mortgage-related debt from financial groups will help financial markets in the long term, analysts said, as well as uncertainty over the details of the plan. For details, see: [nSP4331].

In Toronto, the financial sector was down 3.7 percent, while Bank of Montreal (BMO.TO: Quote) fell 4.8 percent to C$47.53.   Continued...