* TSX falls 1.07 percent to 11,510.24
* Disappointing U.S. home prices, consumer confidence data
* Resources, banks key decliners (Adds details)
By Ka Yan Ng
TORONTO, Feb 23 (Reuters) - Toronto’s main stock index accelerated its decline on Tuesday morning after the U.S. consumer confidence index fell sharply, deepening concern about the strength of the economic recovery.
U.S. consumer confidence fell to a 10-month low in February, adding to early skittishness about the economy when data showed U.S. home prices unexpectedly dipped in December. [ID:nN23248077] [ID:nN2375237]
Softening commodity prices pressured the materials and oil and gas groups, leading both sectors down sharply as oil broke a five-day rally to drop below $79 a barrel, while gold also lost ground. [O/R] [GOL/]
Top heavyweight decliners included Royal Bank of Canada RY.TO, down 1.3 percent at C$55.86, while Suncor Energy SU.TO fell 1.6 percent to C$31.05. Cenovus Energy CVE.TO tumbled 3.75 percent to C$25.70.
“U.S. consumer confidence caught the Street off guard,” said Francis Campeau, a broker at MF Global Canada, in Montreal, noting that the German Ifo institute’s business sentiment index for February also came in lower than expected. [ID:nLDE61M0UN]
“Two very large economies had weaker than expected confidence, and that accelerated the selloff in commodities and financials,” he said.
At 10:33 a.m. (1533 GMT), the Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE was down 124.51 points, or 1.07 percent, at 11,510.24. All 10 of the index’s main groups were lower.
The disappointing economic data added to an already-cautious mood ahead of U.S. Federal Reserve Chairman Ben Bernanke’s congressional testimony later this week.
Investors are seeking clarity on interest rates after the U.S. central bank recently raised its discount rate, which boosted speculation the Fed may hike its benchmark interest rate sooner than expected.
Still, Campeau said, the market had been on a hot streak recently so a pullback was both expected and healthy. The TSX composite closed lower on Monday, snapping an eight-day stretch of gains.
In company news, African Barrick Gold, a spinoff of Barrick Gold Corp ABX.TO, has launched a London listing to raise as much as $1 billion, valuing its assets at about $4 billion, according to people familiar with the matter. Barrick was off 2.35 percent at C$39.13. [ID:nLDE61M1HQ]
Brookfield Asset Management BAMa.TO was off 0.71 percent at C$23.89 after a report said the company was preparing to bid for a large stake in No. 2 U.S. mall owner General Growth Properties Inc GGWPQ.PK. [ID:nN22218132]
$1=$1.05 Canadian Reporting by Ka Yan Ng; editing by Rob Wilson