CANADA STOCKS-TSX slides after Mexico tariff threat

May 31 (Reuters) - Canada’s main stock index fell on Friday, as energy shares were hit by a more than 2% drop in oil prices following U.S. President Donald Trump’s shock threat of tariffs on Mexico.

* At 9:40 a.m. ET (13:40 GMT), the Toronto Stock Exchange’s S&P/TSX composite index was down 118.53 points, or 0.74%, at 15,970.71, on track for its first monthly decline this year.

* Trump’s directive also spelled the potential for chaos for the U.S. Congress approval of USMCA deal, which was negotiated as a replacement to the North American Free Trade Agreement between the United States, Mexico and Canada.

* Meanwhile, latest data showed the Canadian economy grew slower than expected in the first quarter, although market participants were heartened by signs of a strong recovery in March.

* Ten of the index’s 11 major sectors were lower, dragged down by a 1.7% fall in the energy sector.

* U.S. crude prices were down 2.8% a barrel, while Brent crude lost 3.0%, tracking their biggest monthly drop in six months.

* The heavyweight financials sector slipped 1.2% and the industrials sector shed 0.8%.

* Among notable gainers was the materials sector. The sector, which includes precious and base metals miners and fertilizer companies, added 1.6%.

* The largest percentage gainers on the TSX were Yamana Gold Inc and Iamgold Corp, which rose 5.6% and 4.7%, respectively.

* Investors’ flight to safer assets boosted gold prices. Gold futures rose 0.8% to $1,297.9 an ounce.

* On the TSX, 46 issues were higher, while 194 issues declined for a 4.22-to-1 ratio to the downside, with 18.64 million shares traded.

* BRP Inc fell 5.7%, the most on the TSX, while the second-biggest decliner was Nuvista Energy, down 5.0%.

* The most heavily traded shares by volume were Avalon Advanced Materials, Aurora Cannabis Inc and First Quantum Minerals.

* The TSX posted two new 52-week highs and ten new lows.

* Across all Canadian issues, there were 27 new 52-week highs and 26 new lows, with total volume of 33.10 million shares. (Reporting by Medha Singh in Bengaluru; Editing by Maju Samuel)