Financial services sector stocks dragged the Toronto Stock Exchange sharply lower on Thursday as a slew of quarterly earnings reports disappointed investors.

The S&P/TSX composite index plummeted 253.56 points, or 2.3%, to close at 10,793.37.

The financials group tumbled 5.6% as several firms unveiled their financial results for the second quarter.

Shares of Manulife Financial Corp. plunged 14.8% after it reported net income of $1.8 billion in the second quarter and announced that it would cut its dividend for the first time since its initial public offering. Manulife said it would reduce its quarterly dividend by half, to 13¢ a share from 26¢. The news drove its shares down $3.89 to $22.36.

Sun Life Financial Inc. reported stronger-than-expected Q2 net income of $591 million, but warned that third-quarter profit could be reduced by as much as $550 million as a result of updated equity and interest rate related assumptions used to value variable annuity, segregated fund, certain fixed annuity and individual life liabilities. Sun Life shares tumbled $4.62, or 12.3%, to $33.

Shares of Great-West Lifeco Inc. plunged 9.1% after it reported that its Q2 profit fell 27% to $413 million. The company’s stock finished at $24.45, down $2.45.

GMP Capital Inc.’s stock dropped 8.8% after it reported that net income fell due to the impact of converting to a corporation from an income trust. GMP shares closed at $11.52, down $1.11.

Gainers included Home Capital Group Inc., which reported on Thursday that net income jumped almost 30% to a record $34.4 million in Q2. Home Capital’s stock added $1.55, or 4.4%, to close at $36.80.

Also higher on Thursday was Equitable Group Inc., which reported that Q2 net income increased 15.5% to $11.9 million. Equitable Group’s stock gained 2.7% to close at $19.

Meanwhile, oil futures finished the day almost flat. Crude for September delivery slipped just 3¢ to settle at US$71.94 a barrel on the New York Mercantile Exchange.

The energy group retreated by 1.1% during Thursday’s trading.

Canadian Natural Resources Ltd. fell 2.9% to $66.05 and Petro-Canada dropped 2.3% to $45.50.

EnCana Corp. gave back $1.16, or 2%, to close at $56.31.

Higher for the day was Shawcor Ltd., up $1.22, or 6%, to $21.59.

Gold futures finished lower on Thursday. On the Comex division of the New York Mercantile Exchange, August gold retreated by US$3.50, or 0.4%, to settle at US$960.70 an ounce.

The materials group finished down 0.8%, while the sub-gold index edged up 0.2%.

Teck Resources Ltd. fell $1.76, or 6%, to $27.79.

Barrick Gold Corp. slipped 1.4% to $38.32, while shares of Iamgold Inc. surged 5.7% to $12.26.

Shares of First Quantum Minerals Ltd. plunged 8% after news that the Democratic Republic of Congo had cancelled a mining contract with a unit of the company. Its shares fell by $6.10 to $69.85.

The S&P/TSX Venture index dipped 6.87 points, or 0.6%, to end at 1,188.12.

The Canadian dollar gave back more than half a cent on Thursday, to finish at US92.88¢.

Equities in New York also finished lower on Thursday, as investors cautiously prepared for new U.S. employment data, set to be released Friday.

The Dow Jones industrial average fell 24.71 points, or 0.3%, to finish at 9,256.26.

The S&P 500 index lost 5.64 points, or 0.6%, to close at 997.08.

The Nasdaq composite index fell 19.89 points, or 1%, to end at 1,973.16.