(Updates with analyst's quote, context throughout)

By Sruthi Shankar

June 19 (Reuters) - Canada's main stock index was largely

unchanged on Friday, with energy stocks offsetting losses in

gold miners as investors remained cautious about the possibility

of a lasting Middle East peace deal.

By 10:07 a.m. ET, the Toronto Stock Exchange's S&P/TSX

Composite index was flat at 34,963.51 points and on

track for slim weekly gains.

* Global stocks fell after U.S. and Iranian negotiators

called off peace talks aimed at ending the Middle East conflict.

Israel and Hezbollah agreed to a ceasefire in Lebanon, a U.S.

official said, but that did little to lift sentiment.

* Canadian energy firms rose 0.4% as Brent crude

prices remained supported around $80 a barrel.

* Expectations of a peace deal and a gradual reopening of

the Strait of Hormuz, a vital artery for global energy supplies,

helped push Canadian stocks to a record high earlier this week.

* Gold miners fell 1.6% on Friday as the yellow

metal came under pressure from a firmer U.S. dollar and a

hawkish Federal Reserve.

* The Bank of Canada last week left its key interest rate

unchanged and said it was seeing limited evidence that higher

energy prices were fueling broad-based inflation.

* "The recent pullback in crude oil prices gives the BoC

more flexibility to look through a mild broadening of price

pressures, although the shift in market expectations could also

leave markets more susceptible to a hawkish surprise," Robert

Both, economist at TD Securities, said in a note.

* Canada's retail sales grew by 0.5% in April from March to

C$73.03 billion ($51.6 billion), slightly missing expectations,

led primarily by sales at gasoline stations and fuel vendors.

* Canadian space technology firm MDA Space ( MDA ) rose

4.3% after it agreed to buy U.S.-based Blue Canyon Technologies

from RTX's Raytheon business for $620 million in cash.

* Shares of Alamos Gold ( AGI ) sank 18.5% after the miner

cut its production forecast for the second quarter.