UPDATE 4-Tumbling resources chop 260 pts off Toronto stocks

Tue Apr 29, 2008 5:13pm EDT
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By Leah Schnurr

TORONTO, April 29 (Reuters) - Retreating commodities helped knock 260 points off the Toronto Stock Exchange's main index on Tuesday, as it was dragged lower by sinking resource shares.

A selloff in oil and gold, key underlying commodities for the resource-laden Toronto benchmark, sent the materials and energy sectors tumbling 4.8 percent and 2.9 percent respectively.

In the oil patch, Suncor Energy SU.TO was down C$3.76, or 3.3 percent, at C$111.74, while in the gold producers space, Agnico-Eagle Mines AEM.TO slid C$2.59, or 4.2 percent, to C$59.22.

"Today is a reminder that commodities can impact the TSX to the downside as well as the upside," said Elvis Picardo, investment strategist at Northern Securities Inc in Vancouver.

"So far this year, they've really been propping the index up nicely, while the U.S. indexes have been sliding all along, but today it's the reverse."

A firmer U.S. dollar and easing supply worries carved $3.12 off the price of oil, sending it down to $115.63 a barrel the day after it touched a new high near $120.

Gold was also pulled lower by a rise in the U.S. dollar, falling as low as $868.80 an ounce. On Bay Street, the gold producers subindex slumped 4.5 percent.   Continued...