TORONTO (Reuters) - Toronto's main stock market index hit its lowest level in more than four months yesterday as resource issues, particularly gold miners, stumbled heavily.

Gold issues were reeling after bullion prices were hit hard Thursday, when Canadian markets were closed. The index's materials sector, which includes golds, was down more than three percent.

Gold-mining issues were the main drag on the index even though bullion prices rebounded a bit yesterday. Thursday's fall was triggered by heavy selling by funds trying to cover losses in other markets.

Barrick Gold was off 4.9 percent at C$45.95, while Goldcorp was off 5.7 percent at C$43.95.

"The gold stocks are unfortunately catching up to that decline in gold price from yesterday, which is why we're seeing really large drops in some of the major gold producers," said Elvis Picardo, analyst and strategist at Global Securities in Vancouver

The Toronto Stock Exchange's S&P/TSX composite index ended down 98.36 points, or 0.87 percent, at 11,196.06. Half of the index's 10 sectors were lower, including its three biggest groups: financials, materials, and oil and gas.

A report that showed US employment fell in June, the first monthly drop this year, added to worries that the global economic recovery was failing to gain traction.

The Canadian dollar ended firmer against the greenback yesterday as investors looked past soft US jobs data for June.

The US absorbs about three-quarters of all Canadian exports and recent weak spots in both the Canadian and US economies have muddied the recovery outlook.

"We've had a tremendous shift in terms of the global growth outlook," said Camilla Sutton, currency strategist at Scotia Capital.

"We've seen weaker data from the US, weaker data from Canada, and, more importantly, we've seen a major shift in the stance of global policymakers away from supporting growth at all costs and towards fiscal responsibility."

US non-farm payrolls dropped in June for the first time this year, down 125,000 jobs as temporary census employment came to an end. Analysts polled by Reuters had expected a decline of 110,000 jobs last month.