* C$ finishes at C$1.0785 to U.S. dollar
* Slide in oil prices helps fuel drop
* Canadian bond prices higher acromaker the Nasdaq's top drag.
The Dow Jones U.S. home construction index fell 5.5 percent -- its worst one-day percentage slide since May.
The S&P materials index dropped 3.2 percent.
Among shares of natural resource companies, Dow component and aluminum company Alcoa Inc tumbled nearly 7 percent to $11.93, while another Dow stock, heavy equipment maker Caterpillar Inc, fell 4 percent to $54.43. Diversified manufacturer 3M Co shares dropped 2 percent to $74.46.
Sales of newly built single-family homes unexpectedly fell 3.6 percent last month, according to a Commerce Department report. Seperately, data from the Mortgage Bankers Association showed demand for mortgages has fallen for the past three weeks.
The housing data was an additional hurdle for a market already buffetted by uncertainty about the future of the government's $8,000 home buyer tax credit.
The tax credit for first-time home buyers would be extended until the end of April and expanded to cover repeat buyers under a deal reached by key senators, sources familiar with the plan said on Wednesday.
The housing data underscored the stickiness of the real estate downturn amid a tough job market, tighter lending and sliding home values.
Goldman Sachs cut its forecast for third-quarter gross domestic product, a gauge of all goods and services produced within the U.S. borders, to 2.7 percent from 3.0 percent.
The government will release its first estimate of third-quarter GDP on Thursday. GDP is expected to have grown at an annual rate of 3.3 percent in the third quarter, according to 77 analysts polled by Reuters. (Editing by Jan Paschal)