June 6, 2008 / 3:01 PM / 11 years ago

UPDATE 1-Toronto stocks higher but off early record high

(Adds details, analyst)

*TSX index hits record high as resources soar

*Weak U.S. dollar lifts key commodities

*Jobs data weighs on financials and other sectors

By Jonathan Spicer

TORONTO, June 6 (Reuters) - The Toronto Stock Exchange’s main index was higher at midmorning on Friday but off the record it hit early in the day on surging prices for oil and other commodities.

By midmorning, the S&P/TSX composite index .GSPTSE was up 83.73 points, or 0.6 percent, at 15,066.64. Earlier it rose as high as 15,154.77, with the index’s mining-heavy materials sector at a record and the energy sector very close.

Aside from heavily weighted resource shares, however, the rest of the market slumped amid worrying employment figures in Canada and the United States.

Oil and gas producer Canadian Natural Resources (CNQ.TO) led the charge for a second-straight day, up C$4.61 at C$108.25, as oil companies occupied the top three spots among TSX weighted gainers.

The rise was primarily driven by a spike in crude oil, which jumped more than $6 to above $134 a barrel as the U.S. dollar continued to slump.

Oil typically moves inversely to the world’s benchmark currency, which was under pressure after U.S. data showed more jobs were shed in May than expected, and the unemployment rate rose to 5.5 percent from 5 percent. For details, see: [nN05349665]

In Canada, job growth slowed more than expected last month in the biggest loss of full-time jobs since June 2006. However, a jump in part-time work helped the unemployment rate hold steady. For details, see: [nN06309467]

The data weighed on most sectors of the TSX, with financial shares off 1 percent and utilities down 0.5 percent. Royal Bank of Canada (RY.TO), the country’s biggest bank, slipped 66 Canadian cents to C$49.95.

But the heavyweight materials sector, especially gold shares, helped the TSX stay firmly on positive ground.

“Canada has a completely different focus,” Irwin Michael, portfolio manager at ABC Funds, said of the ability of Toronto’s resource sector to dull the impact of the jobs data, which weighed on U.S. stock markets.

Gold producers added 1.5 percent, led by Goldcorp (G.TO), up C$1.31 at C$41.56. The base metals subsector climbed 0.6 percent, with zinc-copper-and-coal producer Teck Cominco TCKb.TO rising 80 Canadian cents to C$50.59.

The weakness in the U.S. dollar lifted the prices of copper, aluminum and gold, providing a solid base for TSX materials shares. ($1=$1.02 Canadian) (Reporting by Jonathan Spicer; Editing by Peter Galloway)

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