The Toronto Stock Exchange fell back into negative territory on Thursday, dragged down by tumbling financial sector stocks.

The S&P/TSX composite index dropped 185.58 points, or 2.4%, to close at 7,629.17.

The financials group tumbled 5%.

CIBC shares fell 4.5% to $37.86 after it announced that it will raise up to $1.6 billion in a Tier 1 debt issue.

Canadian Western Bank shares tumbled 12% to $9.33 after the company reported a first-quarter profit of $25.6 million, down 1% from a year-earlier $25.9 million.

Manulife Financial Corp. saw its stock shed 8.3% to $10.00.

Shares of Bank of Nova Scotia plummeted 5% to $26.21 and Bank of Montreal fell 4.3% to $27.16.

Also sharply lower was Sun Life Financial Corp., down 10.3% to $16.12.

The energy group fell 3.1% on Thursday, as oil futures dipped lower. Crude oil for April delivery fell US$1.77, or 3.9%, to end at US$43.61 a barrel on the New York Mercantile Exchange.

EnCana Corp. fell 3.4% to $48.56 and Husky Energy Inc. dropped 5.5% to $26.30.

Petro-Canada shares shed $1.15, or 4.3%, to end at $25.49.

Canadian Natural Resources Ltd. shares surged 5.1% after it reported fourth quarter net earnings of $1.8 billion, up from $798 million in the same period last year. The company’s shares rose $1.97 to close at $40.51.

Shares in Talisman Energy Inc. slipped 0.9% to $11.38 after it reported fourth quarter net earnings of $1.2 billion, up sharply from year-earlier profits of $656 million.

The materials group was a bright spot during Thursday’s trading, advancing 3.2%. The group got a boost from gold futures, which advanced for the first time in nine sessions.

Gold for April delivery ended up US$21.10, or 2.3%, at US$927.80 an ounce on the Comex division of the New York Mercantile Exchange.

The sub-gold index surged 6.3%.

Gainers included Agnico-Eagle Mines Ltd., up 8.6% to $65.40 and Barrick Gold Corp., higher by 4.9% to $36.99.

Shares of Goldcorp Inc. surged $3.02, or 8.5%, to close at $38.45.

Lower for the day was Potash Corp., down $6.16, or 6.4%, to close at $89.54.

After a volatile day for junior company stocks, the junior S&PTSX Venture exchange finished down 1.26 points, or 0.2%, at 829.69.

The Canadian dollar shed US0.79¢ to close at US77.62¢.

South of the border, financial sector stocks also weighed down the main stock market indexes.

The Dow Jones industrial average fell 281.4 points, or 4.1%, to close at 6,594.44. It was the Dow’s lowest close since April 15, 1997.

The S&P 500 index dropped 30.32 points, or 4.3%, to end at 682.55.

The Nasdaq composite index slumped 54.15 points, or 4%, to close at 1,299.59.