* TSX falls 1.5 pct to 10,910.75, ends Oct. down 4.25 pct
* Resources key decliners, telecoms lone group to shine
* August GDP down, doubts rise about growth forecasts (Adds details, updates prices)
By Ka Yan Ng
TORONTO, Oct 30 (Reuters) - Toronto’s main stock index broke its seven-month rally with a big drop on Friday, as its two big resource sectors bore the brunt of the sharp decline.
Losses were heavy in Suncor Energy (SU.TO), Barrick Gold (ABX.TO) and other commodity-based issues, which account for more than 40 percent of the index’s weighting. The fall was induced by softening prices for oil and gold, while the U.S. dollar recovered from steep losses. [GOL/] [O/R] [FRX/]
Suncor dropped 2.84 percent to C$35.92, while Encana Corp (ECA.TO) shed 2.96 percent to C$60. Barrick tumbled 1.8 percent to C$38.96.
The S&P/TSX composite index .GSPTSE closed 164.47 points lower, or 1.49 percent, at 10,910.75, paring a decline that saw it skid as low as 10,767.58, unwinding all of the previous session’s 269-point surge.
The main stock index finished the month lower for the first time since February. In its seven-month rally, the TSX rose more than 35 percent and almost without much give-back all the way up. It finished down 4.25 percent in October.
“I still think we’re in for a correction. I think the debate most people have is whether it’s going to be between now and the end of the year, or is it going to be end of the year, January or February. It’s hard to say,” said Steve Ibel, institutional equities trader at Beacon Securities in Halifax, Nova Scotia.
Also dampening the market’s mood, a report on Friday showed Canadian gross domestic product unexpectedly shrank by 0.1 percent in August from July, casting serious doubt on the Bank of Canada’s forecast for economic growth in the third quarter. [ID:nN30410008]
The telecoms group was the sole bright spot among the TSX’s 10 main groups on Friday, rising 1.36 percent. Rogers Communications (RCIb.TO) led the charge, jumping 2.5 percent to C$31.75. (Editing by Rob Wilson)