April 29, 2008 / 2:33 PM / in 9 years

UPDATE 1-Resources drag Toronto stocks lower

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TORONTO, April 29 (Reuters) - Toronto’s main stock market index remained weak on Tuesday amid falling gold and energy prices and as investors paused to assess the market’s recent bull run.

The Toronto Stock Exchange’s resource-laden S&P/TSX composite index .GSPTSE was down 62.09 points, or 0.4 percent, at 14,023.76, after dropping as low as 13,983.97 earlier in the day.

”The TSX was just so overstretched that it needed to consolidate. “It had such a huge move that it needs to pull back a little bit,” said Julie Brough, assistant vice-president at Morgan Meighen and Associates.

“There isn’t enough confidence in this market to continue to drive it higher. It’s been based solely on the oil prices and on the commodities.”

Six of the TSX index’s 10 main groups were lower, led by a 0.4 percent drop in the influential energy group and a 2.4 percent fall in the resource-heavy materials group.

Energy shares, which account for about 30 percent of the overall index, dropped as the price for U.S. crude oil retreated 1.6 percent to $116.84 a barrel on a firming U.S. dollar and the resolution of a strike at a British refinery.

EnCana Corp (ECA.TO), slipped 89 Canadian cents to C$82.80 and Suncor Energy (SU.TO) fell C$1.18 to C$114.32.

Meanwhile, Petro-Canada PCA.TO rose 90 Canadian cents to C$51.03 after its first-quarter profit jumped 82 percent, while Nexen Inc NXY.TO climbed 23 Canadian cents to C$36.84 as strong oil and gas production from its Buzzard field in the North Sea helped boost profit about 400 percent.

Gold shares fell as spot gold retreated to around $879.80 an ounce amid a rising U.S. dollar and as investors took a cautious stance ahead of the U.S. Federal Reserve’s decision on interest rates Wednesday. Analysts expect the Fed to cut rates by 25 basis points.

Barrick Gold (ABX.TO), the biggest producer in the world, fell 91 Canadian cents to C$38.61 and Agnico-Eagle Mines Ltd (AEM.TO) dropped C$1.30 to C$60.51.

Materials heavyweight Potash Corp (POT.TO) dropped C$4.87 to C$190.73.

A 1.4 percent boost from the telecommunication sector helped cushion some of the broader losses.

Sector heavyweight Rogers Communications (RCIb.TO) jumped C$1.24 to C$44.14 after it said its first-quarter profit more than doubled and that it had struck a deal with Apple Inc (AAPL.O) to bring the iPhone to Canada later in the year. ($1=$1.01 Canadian) (Reporting by Scott Anderson; Editing by Bernadette Baum)

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