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CANADA STOCKS-Technology stocks drag TSX lower; BoC rate decision in focus

(Updates prices, adds details and comments)

By Shashwat Chauhan

Dec 5 (Reuters) - Canada's main stock index dropped on Monday, as elevated government bond yields dented rate-sensitive technology shares, while investor focus shifted to the Bank of Canada's interest rate meeting due later this week.

At 10:42 a.m. ET (1542 GMT), the Toronto Stock Exchange's S&P/TSX composite index was down 100.71 points, or 0.49%, at 20,384.95.

Technology stocks fell 1.1%, with BlackBerry leading losses with a drop of more than 5%.

The Bank of Canada on Wednesday will be one of the first major economies to announce its rate-hike decision with the U.S. Federal Reserve and the European Central Bank set to follow next week.

Traders are pricing in a 69.1% chance of a dialed-down 25-bps hike to 4% on Wednesday, after the central bank had surprised markets with a 50-bps increase last month.

"I am more of the belief now that this might be the last of its hike," said Bryden Teich, portfolio manager at Avenue Investment Management.

"Directionally, we are getting closer to an end for where they intend to take the overnight rate."

Materials lost 0.8% as gold miners dropped after bullion pulled back from a five-month high on Monday.

Prominent cannabis companies Canopy Growth Corp (CGC) and Tilray Brands surged up to 6%, boosting the broader healthcare by 3.7%.

Shares of cannabis stocks jumped as analysts expect a positive update on pivotal U.S. banking bill that could provide further legitimacy to the sector.

Meanwhile, the value of Canadian building permits fell by 1.4% in October from prior month, as per Statistics Canada data.

Among individual stocks, AltaGas (ATGFF) gained 5.7% after the energy company reported a higher full-year outlook. (Reporting by Shashwat Chauhan in Bengaluru; Editing by Krishna Chandra Eluri and Sherry Jacob-Phillips)

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