March 19, 2008 / 5:38 PM / in 10 years

UPDATE 2-Toronto stocks dive as resources weaken further

(Updates to afternoon)

TORONTO, March 19 (Reuters) - The Toronto Stock Exchange’s main index deepened losses on Wednesday afternoon as resource shares dropped on sharp declines in commodities prices.

Mining and energy companies were among the biggest drags on the resource-laden index as oil and gold prices extended a strong downturn.

Agnico-Eagle Mines (AEM.TO) fell C$3.50, or 4.8 percent, to C$70.00, and Barrick Gold (ABX.TO) was down C$2.69, or 5.5 percent, at C$46.59. In the oil patch, Suncor Energy (SU.TO) lost C$3.59, or 3.4 percent, to C$99.33, and Canadian Natural Resources (CNQ.TO) shed C$3.40, or 4.8 percent, to C$67.63.

The materials sector skidded 4.8 percent, with its subindexes of gold producers and base metals miners falling 3.7 percent and 5.1 percent respectively. The heavyweight energy group slid 3 percent.

Gold prices, which recently ran up to more than $1,000 an ounce, were down nearly 6 percent on profit-taking. Oil prices, which have also hit a string of record highs, fell more than $4 a barrel.

The S&P/TSX composite index .GSPTSE was down 194.34 points, or 1.48 percent, at 12,942.36 with all but three of its 10 main sectors in negative territory.

The index gave back the gains it made in the previous session, when investors were encouraged by a hefty interest rate cut from the U.S. Federal Reserve.

The banking sector remained on the upside, adding 1.7 percent, on bargain-hunting among shares that have been hard hit by troubles in financial markets and fears of more to come.

Canadian Imperial Bank of Commerce (CM.TO) rose 86 Canadian cents, or 1.4 percent, to C$61.61, and Toronto-Dominion Bank (TD.TO) was up C$1.00, or 1.6 percent, to C$63.97.

Lundin Mining (LUN.TO) was off 68 Canadian cents, or 9.2 percent, at C$6.73 after it reported a fourth-quarter loss due to a large impairment charge related to acquisitions, as well as weakness in zinc prices and the U.S. dollar.

Toy maker Mega Brands MB.TO slid 33 Canadian cents, or 8.4 percent, to C$3.61 after it said it will be forced to take a $30-million charge in the fourth quarter, mostly due to recent product recalls.

$1=$1.01 Canadian Reporting by Leah Schnurr; Editing by Peter Galloway

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