TORONTO -

Sliding gold and energy stocks led the way to a sharp loss on the Toronto stock market Friday, but the main index racked up gains for the week as investors grew more confident about an economic recovery.

The S&P/TSX composite index fell 82.28 points to 11,445.95 gaining 192.72 points or 1.71 per cent this week, led by rising energy and financial stocks.

A pickup in U.S. dollar strength sent the Canadian dollar down 0.26 of a cent to 93.48 cents U.S.

The gold sector led decliners, down 1.67 per cent as the December bullion contract on the New York Mercantile Exchange drifted $3.20 lower to US$1,010.30 an ounce. On the TSX, Goldcorp Inc. (TSX:G) faded 98 cents to $43.99.

The energy sector was off 1.45 per cent as the October crude contract on the New York Mercantile Exchange slid 43 cents to US$72.04 a barrel. On the TSX, EnCana Corp. (TSX:ECA) gave back $1.54 to $61.39.

Crude was up almost US$3 on the week, on hopes that the United States, the biggest oil consumer, is on the road to recovery. Still, the recession has sapped American fuel consumption, and U.S. oil stockpiles are 14 per cent larger than last year.

The TSX Venture Exchange was up 9.06 points to 1,281.8.

In economic news, Statistics Canada reported wholesale sales increased 2.8 per cent in July, mainly as a result of higher sales in the auto sector.

"The tone of these data is undeniably positive and though there may be some transitory element to the strength in the motor vehicles component, it will still undoubtedly add to July GDP," said Charmaine Buskas, senior economics strategist at TD Securities.

"We estimate that GDP for July could be in the range of 0.4 per cent to 0.5 per cent."

New York indexes added to a series of sharp gains, as the Dow Jones industrials climbed 36.28 points to 9,820.2 for a gain of 214.79 points or 2.23 per cent this past week.

The Nasdaq composite index was up 6.11 points to 2,132.86 while the S&P 500 index gained 2.81 points to 1,068.34.

Investors took in earnings from smartphone maker Palm Inc. which showed wider first-quarter loss -- its ninth in a row.

Adjusted results, however, handily beat Wall Street's forecast as the company shipped more of its new Pre devices than had been expected. But investors were disappointed with its second-quarter sales forecast and news of a planned stock offering and its shares slipped 43 cents to US$14.01.

Economic confidence has risen this week after Federal Reserve chairman Ben Bernanke said the recession is for intents and purposes over, while data showed that industrial production rose sharply in August and housing starts are heading higher.

Marc Harris, co-head of global research for RBC Capital Markets in New York, said the strength of the rally has surprised many investors because some of the stocks posting the biggest advances are of lower-quality companies with weak balance sheets that investors only months ago feared might go out of business.

"Even turkeys are going to fly in a hurricane," Harris said. "Those lower-quality companies are leading the charge here."

Elsewhere on the TSX, Canadian Pacific Railways (TSX:CP) paced a 1.27 per cent decline in the industrials sector, down $1.07 to $52.44 after analyst John Larkin of Stifel, Nicolaus & Co. cut his rating on the railroad to "sell" from "hold", saying CPR's fundamentals haven't improved enough to justify its 37 per cent increase in share price since July 10.

Elsewhere in the sector, Bombardier Inc. (TSX:BBD.B) lost 13 cents to $4.66 as it announced its rail division has received an order for 30 tram trains, which will be manufactured in Germany and Austria. The order is valued at euro129 million (US$190 million) not counting an option for 45 additional vehicles.

The base metals sector was flat even as December copper closed down 11.1 cents to US$2.785 a pound.