TORONTO (Reuters) - Toronto's resource-heavy main stock index tumbled yesterday, pushed lower by weak commodity prices and a surprise drop in US home sales.

The index's energy sector fell 2.3 percent as Suncor Energy dropped 2.4 percent to C$33.73, and Encana Corp. lost 3.1 percent to C$34.16.

Base-metal miners knocked off 3.2 percent as Teck Resources shed 3 percent at C$35.57 and First Quantum Minerals fell 3.1 percent to C$62.60.

The hefty drop in resource-linked shares followed a decline in oil and base metals prices as expectations grew that a slow rise in China's yuan would have a more limited impact on demand than initially anticipated.

"Softer prices are a natural sort of corollary to concerns about slowing global growth," said Elvis Picardo, analyst and strategist at Global Securities in Vancouver.

"China's announcement caused some extremely short-term optimism and a flurry of buying but I guess investors reassessed the implications of that move." As well, US data that showed existing home sales fell in May raised doubts about the pace of economic recovery. The Toronto Stock Exchange's S&P/TSX composite index closed down 138.14 points, or 1.16 percent, at 11,797.94, with nine of its 10 main sectors weaker.

Healthcare shares gained 3.3 percent as drugmaker Biovail Corp rallied 13.1 percent to C$19.25.

The company said on Monday it would take over US-based Valeant Pharmaceuticals International in a complex deal that the companies said would position them better to serve the growing baby boomer market.

The Canadian dollar finished lower against the greenback yesterday after the Bank of Canada said the currency's drag on the Canadian recovery could be a key issue in future monetary policy. Bank of Canada Deputy Governor Timothy Lane said the value of the Canadian currency against the US dollar would affect the central bank's decision on interest rates on July 20 and beyond, sending the currency to a session low at C$1.0296 to the US dollar, or 97.13 US cents.