CANADA STOCKS-TSX turns lower as TD and energy shares fall

(Adds portfolio manger comment, details, updates prices)

* TSX down 31.76 points, or 0.2 percent, to 15,465.08

* Six of the TSX’s 10 main groups fall

TORONTO, March 10 (Reuters) - Canada’s main stock index turned negative in mid-morning trade on Friday, with shares in Toronto-Dominion Bank falling sharply on reports of employees admitting to breaking the law under pressure to meet sales targets.

The bank, one of Canada's biggest, was last down 2.7 percent at C$67.97, after CBC said hundreds of current and former TD employees had responded with corroboration of an earlier report about the bank's tactics. (here)

“I would assume that if these allegations are true then it’s going to become a bigger story and you’re going to see the regulators and the government take a look at TD is going to be dragged through the mud,” said Barry Schwartz, a portfolio manager at Baskin Financial Services.

TD did not immediately respond to requests for comment.

The financials group slipped 0.3 percent, despite many of its biggest members moving higher as solid domestic jobs data broadly boosted bond yields.

The energy group retreated 0.7 percent, as oil prices fell further after sharp losses in the past two sessions. Canadian Natural Resources declined 1.3 percent to C$42.73 after jumping sharply on Thursday’s news the company would buy significant oil sands assets from Royal Dutch Shell.

At 11:04 a.m ET (1604 GMT), the Toronto Stock Exchange’s S&P/TSX composite index fell 31.76 points, or 0.2 percent, to 15,465.08.

Six of the index’s 10 main groups were in negative territory.

The materials group, which includes precious and base metals miners and fertilizer companies, added 0.9 percent, as Barrick Gold Corp rose 1.1 percent to C$24.15 and First Quantum Minerals Ltd up 1.0 percent to C$13.72.

Gold recovered from a five-week low after U.S. non-farm payrolls report for February failed to meet lofty expectations, while copper rose after six straight sessions of declines as a surge in inventories halted and workers began an indefinite strike at a mine in Peru, raising supply concerns.

Element Fleet Management declined 9.7 percent to C$12.775 as several banks downgraded or trimmed their price targets on the company after it reported quarterly earnings. (Reporting by Alastair Sharp; Editing by Meredith Mazzilli)