*

TSX down 0.3%

*

Utilities shares lead broader declines

*

Algonquin Power & Utilities ( AQNB ) to sell renewables unit,

shares

plummet

(Updated at 9:47 a.m. ET/ 1347 GMT)

By Purvi Agarwal

Aug 9 (Reuters) - Canada's main stock index moved lower

on Friday amid a broader retreat and is set for a weekly

decline, as investors took a breather to reflect on a volatile

week for stock markets.

At 9:47 a.m. ET (13:47 GMT), the Toronto Stock Exchange's

S&P/TSX composite index was down 70.53 points, or

0.32%, at 22,155.08.

The index logged its best day since February 15 on Thursday

after U.S. jobs data suggested that fears of an unravelling

labor market were overblown, and rate-cut signals from the

Federal Reserve policymakers helped sentiment recover.

Markets have been trying to find their footing in the face

of a turbulent week, characterized by recessionary fears in the

U.S., coupled with an unwinding of Japan's yen-funded carry

trade.

"Investors are digesting what has unfolded over the week - a

lot of volatility, news and uncertainty moving forward. Markets

are just taking a bit of a breather today," said Macan Nia,

co-chief investment strategist at Manulife Investment

Management.

In the market, utilities led declines with a 1.5%

loss, weighed down by a 11.7% fall in Algonquin Power &

Utilities Corp ( AQNB ) after it announced it would sell its

renewable energy business, excluding hydropower operations, for

up to $2.5 billion.

The index saw broader declines with the exception of

heavy-weighted financials that inched 0.1% higher.

Meanwhile, Canada's economy unexpectedly shed a net 2,800

jobs in July, while the unemployment rate remained at a 30-month

high of 6.4%, data showed on Friday.

"The numbers confirm the narrative that the Canadian economy

is weakening and that the BoC is going to have to continue

cutting rates to stimulate the economy," Nia added.

Among other stocks, Canopy Growth ( CGC ) dipped 7.4%

despite a smaller-than-expected core loss for the first quarter.