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TORONTO (Reuters) - Toronto's main stock index closed sharply lower on Thursday as a slide in oil and gold prices and disappointing U.S. economic data weighed on heavyweight energy, mining and financial shares.
Among oil companies, Suncor Energy fell 2.88 percent to C$37.14, and Canadian Natural Resources, which said output at its Horizon oil sands project fell 22 percent in December, slid 3.03 percent to C$42.95.
Imperial Oil was another big decliner, down 2.64 percent at C$39.76. The energy group led the index's retreat, falling 1.73 percent.
Oil prices dropped more than 2 percent to below $89 a barrel as a stronger dollar and December U.S. retail sales data that missed Wall Street estimates deterred cautious investors, who were waiting to see if recent positive economic reports would translate into greater consumer demand.
Royal Bank of Canada was off 0.92 percent at C$51.61. Mining giant Barrick Gold extended its slump, sliding 1.54 percent to C$49.07. Goldcorp also fell, dropping 2.28 percent to C$42.94.
The index's materials group, home to mining stocks, was down 1.16 percent. Financial issues, often influenced by economic factors, slipped 0.28 percent.
Safe-haven bullion retreated for a fourth straight day as the U.S. dollar strengthened and expectations grew that Friday's U.S. employment data will beat forecasts.
"Certainly the economic indicators have been good, so it's almost like good news is bad news, especially for gold," said Laura Lau, senior portfolio manager at Sentry Select Capital Corp.
"It looks like bond yields are in general going up, so gold becomes a little less desirable. There's certainly some profit-taking, there's no doubt about that."
The Toronto Stock Exchange's S&P/TSX composite index closed down 84.32 points, or 0.63 percent, at 13,311.67. Five of the index's main groups lost ground.
The index, which gained 3.79 percent in December, has lost 1 percent in the first three trading days of 2011.
"I think the market's got somewhat ahead of itself in December...I'm not saying the market's expensive," said RKH Investments's Rick Hutcheon. "I think that we have brought ourselves to a point in the market where we're in need of a consolidation or a correction. I think it's more a pause."
In individual company news, Valeant Pharmaceuticals International Inc was one of the biggest gainers. Its shares jumped 18.76 percent to C$35.45 after it said on Thursday it expected to report quarterly results that exceed analysts' expectations and issued a 2011 outlook that topped forecasts.
Shares of Baffinland Iron Mines, which was among the top traded companies on the TSX by volume, were down 0.69 percent at C$1.43. Nunavut Iron Ore Chairman Bruce Walter said his private equity-backed company has no plans to raise its takeover bid for Baffinland but did not rule out a higher bid.
Reporting by Solarina Ho; editing by Peter Galloway