TORONTO (Bloomberg) - Canadian stocks fell for a fifth day as Suncor Energy Inc., Goldcorp Inc. and other energy and materials producers declined on speculation higher prices may cause central banks to raise borrowing costs, hurting demand.

Central banks including in Canada and the US have signaled this week that inflation, driven by record prices for oil and other commodities, has become their main concern, suggesting that a round of interest rate cuts is over.

"On the one side you have the inflationary effect of commodities," said Todd Johnson, who helps manage about $65 million as a portfolio manager at BCV Asset Management Inc. in Winnipeg, Manitoba. "On the other hand you have the economic slowdown. The banks are on a precipice. That's not great for stock prices."

The Standard & Poor's/TSX Composite Index fell 0.7 percent to 14,607.37 as of 3.55pm in Toronto. Canada's stock benchmark is up 5.6 percent this year and reached a record on May 20, for the best gain among the world's 20 largest markets, as soaring oil, grain and metals prices pushed higher commodity-related stocks that account for more than half its value.

Suncor Energy, the world's second-largest oil-sands miner, dropped 4.2 percent to C$65.88. EnCana Corp., Canada's biggest energy company by market value, fell 1.8 percent to C$91.72. Rival Canadian Natural Resources Ltd. slid 1.2 percent to C$103.95.

Goldcorp, the world's second-biggest bullion miner by market value, retreated 2.2 percent to C$39.18. Larger rival Barrick Gold Corp. dropped 2.7 percent to C$39.39.

Crude oil fell as much as $4.83 a barrel in New York before rebounding late in the session in New York, adding 36 cents to $136.74 after Nigeria's president said the country's state-owned oil company will take some over operations from a Royal Dutch Shell plc. joint venture. Futures have doubled in a year.

Gold tumbled 1.2 percent to $872 an ounce. Copper fell to the lowest in more than two months.

Corn advanced to a record for a sixth day on speculation the US, the world's biggest producer and exporter, may reduce its crop forecast, straining global food supplies and stoking inflation. The US is Canada's most important export market. Canada is the largest supplier of crude oil to the US.

The Bank of Canada unexpectedly left its key interest rate unchanged at three percent this week and Federal Reserve Chairman Ben Bernanke and other officials have warned this month that the US central bank will act to stem a jump in longer-term inflation expectations. Investors have increased bets that the Fed will raise its benchmark interest rate as soon as August.

Financial shares declined, led by Bank of Montreal, which dropped 2.9 percent to C$44.51. Canadian bank profits will be squeezed for the rest of the year as global credit market strains cut into advisory fees and create more losses on past loans, a Bank of Canada research paper said today.

Nortel Networks Corp. climbed to the highest since February 26, adding 8.8 percent to C10.25. North America's biggest maker of phone gear was raised to "overweight" from "neutral" by JPMorgan Chase & Co. analyst Ehud Gelblum in New York.

The shares, up for a fourth-straight day, gained 14 percent yesterday after Nortel said it will focus on developing a next- generation wireless technology backed by AT&T Inc. and Verizon Wireless. The stock's still down 61 percent in a year.