* TSX falls 95.11 points, or 0.76 percent, to 12,486.64 * Eight of 10 main sectors decline * Talisman drops after quarterly loss By John Tilak TORONTO, July 31 (Reuters) - Canada's main stock index slipped on Wednesday to its lowest closing level in two weeks, dragged by declines in materials and financials, as investors digested a statement from the Federal Reserve that the U.S. central bank will continue its bond-buying stimulus program. Weakness in Potash Corp, which extended its declines after news of the breakup of a Russian-Belarussian potash joint venture on Tuesday sent shockwaves through the industry, further weighed on the market. Data showed U.S. economic growth unexpectedly accelerated in the second quarter, laying a firmer foundation for the rest of the year that could bring the Federal Reserve a step closer to cutting back its monetary stimulus. The resource-heavy Toronto market declined far more sharply than U.S. stocks, extending a theme of underperformance this year. The market has slightly warmed up to material stocks in recent weeks, said Paul Taylor, chief investment officer at BMO Asset Management. "But is there any permanent change in investor behavior related to the commodity sector? The answer is no," he said. "The case for a sustainable, predictable run in commodity prices is just not there." The U.S. Federal Reserve said the economy continues to recover but is still in need of support, offering no indication that it is planning to reduce its bond-buying stimulus at its next meeting in September. "The Fed is managing the message very carefully," Taylor said. "They're making every attempt to stay on story." "They want to keep repeating that the tapering is data-dependent and ensure investors understand that it's not that we're automatically in a period of rising interest rates," he added. The Toronto Stock Exchange's S&P/TSX composite index closed down 95.11 points, or 0.76 percent, at 12,486.64, at its lowest since July 15. Eight of the 10 main sectors on the index were in the red. Financials, the index's most heavily weighted sector, lost 0.8 percent. Royal Bank of Canada, the country's biggest lender, dipped 1.1 percent to C$64.16, and Toronto Dominion Bank fell 0.8 percent to C$86.56. Shares of energy producers fell slightly, with gains in Canadian Natural Resources Ltd offset by a weakness in Talisman Energy Inc. Talisman posted a surprise second-quarter loss and said it now expects full-year production to be at the lower end of its earlier forecast range due to a drop in output from its North Sea operations. The stock lost 2.5 percent to settle at C$11.64. The materials sector, which includes mining stocks, stumbled 2.5 percent. Potash slid 8.8 percent to C$29.80 and had the biggest negative influence on the market. Gold miners also declined. Barrick Gold Corp shed 4.1 percent to C$17.00. In other news, Torstar Corp warned that print revenue would remain under pressure in the second half of the year, after reporting a fifth straight fall in quarterly profit. Shares of the owner of Canada's largest daily newspaper by circulation fell 5 percent to C$5.65. CGI Group Inc shot up 9.8 percent to C$35.50 after the company reported quarterly results, while Intact Financial Corp jumped 2.8 percent to C$60.41 after the insurer reported a stronger-than-expected profit on Wednesday.