July 23 (Bloomberg) -- Canadian stocks fell for a second day, led by Suncor Energy Inc. and Cameco Corp., as the price of crude oil retreated, dragging down energy producers, the second-biggest industry group in the nation's main equity index.

The Standard & Poor's/TSX Composite Index dropped 114.54, or 0.8 percent, to 14,468.33 in Toronto. The benchmark has declined 1.1 percent in two days, after reaching a record on July 19 when crude oil rose, heading toward an 11 month high the next day.

Materials and energy stocks, accounting for more than two- fifths of the S&P/TSX, have helped the index rally 12 percent this year as rising prices for metals and energy boosted companies' profits and cashflows, spurring record takeovers in the global metals and mining industry.

``It might be the end of the cycle for energy stocks,'' said Andre Chabot, who helps manage about $287 million at Triasima Portfolio Management Inc. in Montreal. ``Commodities may have peaked or are no longer going up at a rate that will boost profits by a lot. We're in a bull market but we're cautious: the market may be vulnerable to going sideways for a while.''

Suncor Energy, the second-biggest oil-sands miner, dropped C$1.74 to C$98.35. Petro-Canada, the country's third-largest oil and gas company, fell C$1.50 to C$59.75 after reaching the highest ever on July 20. EnCana Corp., Canada's biggest natural-gas producer, lost C$1.01 to C$65 74.

Nexen Inc. retreated 87 cents, or 2.5 percent, to C$34.68. Ontario Teachers' Pension Plan, Canada's third-biggest pension fund manager, said on July 20 in a regulatory filing that it sold 6.5 million shares at C$33.75 apiece on July 18, or about 11 percent of its stake in the oil and gas producer. The sale is part of a ``rebalancing'' of its portfolio, Teachers' spokeswoman Deborah Allan said.

Oil Falls

Oil for September delivery fell 1.2 percent to $74.89 a barrel in New York, after Reuters reported that the Organization of Petroleum Exporting Countries may pump more oil to increase supplies, on concern that high prices may hurt the world economy. Futures reached $76.13 on July 20, the highest since Aug. 10. Prices are up 23 percent this year.

Shares of Cameco slid C$3.19, or 6.5 percent, to C$46.13, the most in nine months. The world's largest uranium producer said it will halt output of uranium hexafluoride at its Port Hope, Ontario plant for at least two months, after discovering that uranium and production-related chemicals contaminated soil beneath a conversion plant.

Cameco was also dragged down as shares of Centerra Gold Inc., a bullion producer that it controls, fell to the lowest since November 2005 on an analyst downgrade. Centerra Gold, which last week reduced its 2007 forecast of gold production by one-third from the Kumtor mine in the Kyrgyz Republic, fell C$1.28, or 15 percent, to C$7.48 for the worst drop in the S&P/TSX.

Rating Cut

CIBC World Markets' Barry Cooper cut the stock to ``sector performer'' from ``sector outperformer,'' citing ``uncertainties'' over the company's reserves and the potential for extended political discussions about Kumtor in the Central Asian country. The analyst expects these discounts will stay in place until the second half of 2008 and cut his 12-to-18-month share-price forecast to C$11 from C$15.

A gauge of energy shares, which includes uranium companies, declined 1.7 percent, the most among 10 industry groups in the index. A measure of raw-materials stocks slid 0.7 percent. Energy and raw-materials stocks together account for 45 percent of the S&P/TSX's value.

Other bullion miners dropped along with the price of the precious metal.

Shares of Agnico-Eagle Mines Ltd., owner of Canada's biggest gold deposit, dropped 81 cents to C$46.54. Goldcorp Inc., Canada's second-biggest producer, fell 14 cents to C$28.80.

Gold futures for August delivery fell 0.5 percent to $681.50 an ounce in New York, after gaining 2.6 percent last week. The metal on July 20 reached $687.60, the highest since May 9.

The following shares had unusual price changes.

Connors Bros. Income Fund (CBF-U CN) dropped the most in more than 8 months, falling 84 cents, or 7.9 percent, to C$9.81. The maker of canned fish and meat expanded a recall linked to botulism to include chili distributed in Canada and pet food.

Open Text Corp. (OTC CN) fell C$1.12, or 5.1 percent, to C$21.07. The maker of software that helps companies manage documents was cut to ``sell'' from ``hold'' by Canaccord Adams's Peter Misek, who cited ``unsustainable cashflow levels'' and integration risks related to the company's $390 million purchase last year of rival Hummingbird Ltd. The Toronto-based analyst also lowered his share-price forecast to the equivalent of C$18.79 ($18) from $25.

Southwestern Resources Corp. (SWG CN) declined 4 cents, or 1.8 percent, to C$2.23. The copper and gold explorer is being sued by shareholders after it said on July 19 that it reported flawed data at a deposit in China. The class-action suit was filed in Toronto by the law firms of Sutts Strosberg LLP and Siskinds LLP on behalf of anyone who bought Southwestern shares from Aug. 31, 2005, to July 18, 2007, the firms said. The shares have lost 65 percent of their value in three days.

Verenex Energy Inc. (VNX CN) added C$1.28, or 7.9 percent, to a record C$17.43. The Canadian petroleum explorer gained after partner PT Medco Energi Internasional, Indonesia's biggest non- state oil company, said it expects its Libyan area, which is operated by Verenex, to pump as much as 100,000 barrels of oil a day, double an earlier estimate.

Barrick Gold Corp. (ABX CN)
Cameco Corp. (CCO CN)
Centerra Gold Inc. (CG CN)
EnCana Corp. (ECA CN)
Goldcorp Inc. (G CN)
Nexen Inc. (NXY CN)
Petro-Canada (PCA CN)
Suncor Energy Inc. (SU CN)

To contact the reporter on this story: John Kipphoff in Toronto at jkipphoff@bloomberg.net.

Last Updated: July 23, 2007 16:35 EDT