S&P/TSX composite dips even as gold price rises to near nine-year high

S&P/TSX composite dips even as gold price rises to near nine-year high

S&P/TSX composite dips even as gold price rises to near nine-year high

TORONTO — Canada’s main stock index dipped on rising COVID-19 infections but still outperformed its U.S. counterparts as the materials sector surged with the price of gold hitting a near nine-year high.

“In general, equity markets are taking a bit of a breather after an extended stretch of gains in the last week, which likely sparked some profit-taking,” said Candice Bangsund, portfolio manager for Fiera Capital.

The S&P/TSX composite index closed down 74.17 points at 15,595.50.

In New York, the Dow Jones industrial average was down 396.85 points at 25,890.18. The S&P 500 index was down 34.40 points at 3,145.32, while the Nasdaq composite was down 89.76 points at 10,343.89 after setting a record high of 10,518.98 in earlier trading.

Markets slipped on continued attention to rising COVID-19 infections in the U.S. that has prompted some states to reverse reopenings.

Stock markets have been fairly resilient to these headlines but investors are taking profits given “that there’s still a lot of uncertainty out there as to the progression of the virus and of course the global economy as well,” Bangsund said in an interview.

Materials was the leading sector on the TSX, gaining two per cent as the August gold contract was up US$16.40 at US$1,809.90 an ounce. That’s the highest level since Aug. 22, 2011. The September copper contract was up 2.25 cents at nearly US$2.80 a pound.

The movements helped Novagold Resources Inc. and Eldorado Gold, whose shares increased six and 5.7 per cent respectively.

Simmering economic and virus-related uncertainties have boosted investor demand for gold, which has been a safe haven even as equity markets have risen.

Copper has almost erased its losses stemming from COVID as Chinese demand has increased with factories reopening while prices have increased over a spike in infections in Chile, which is a predominant global production hub, said Bangsund. In fact, she said emerging markets are the new global hot spot and account for 46 per cent of global cases of COVID.

Technology was the only other sector on the TSX to gain, largely on the back of shares of Shopify Inc. climbing 3.1 per cent. The sector moved for most of the day in lockstep with the Nasdaq, which rose as some large technology companies continued to set new record highs.

Nine sectors were down Tuesday, led by energy, financials and consumer discretionary.

Energy dropped 2.6 per cent even though the price of crude oil slipped slightly after moving higher earlier in the day. Seven Generations Energy Ltd. lost 6.3 per cent while Husky Energy Inc. was down 5.25 per cent.

The August crude contract was down one cent at US$40.62 per barrel and the August natural gas contract was up 4.6 cents at nearly US$1.88 per mmBTU.

Analysts will be watching closely on Wednesday the weekly U.S. stockpile report for any sign of waning demand for gasoline during the very busy summer driving season, Bangsund said.

The heavyweight financials sector fell 1.8 per cent while a 5.2 per cent drop in Canada Goose Holdings Inc. shares sent consumer discretionary down nearly 1.8 per cent.

The industrials sector was hurt by a 4.2 per cent drop in the shares of Air Canada.

The Canadian dollar traded for 73.62 cents US compared with 73.84 cents US on Monday.

This report by The Canadian Press was first published July 7, 2020.

Companies in this story: (TSX:AC, TSX:SHOP, TSX:GOOS, TSX:VII, TSX:HSE, TSX:ELD, TSX:NG, TSX:GSPTSE, TSX:CADUSD=X)

Ross Marowits, The Canadian Press

Business

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

SARS-CoV-2 virus particles, which causes COVID-19, emerge from the surface of cells isolated from a patient in the U.S. and cultured in a lab in a 2020 electron microscope image. THE CANADIAN PRESS/AP-HO, National Institute of Allergy and Infectious Diseases - Rocky Mountain Laboratories
Alberta now has 17,743 active cases of COVID-19

Province now has 17,743 active cases

File Photo
Sylvan Lake Community Christmas Eve Dinner cancelled

The 20th anniversary of the Community Christmas Eve dinner is cancelled amidst COVID-19 concerns

The consensus around the Sylvan Lake council chamber Wednesday was the town does not have the ability to properly enforce a proposed mandatory indoor mask bylaw. File Photo
Sylvan Lake town council squashes mask bylaw

The bylaw did not make it past first reading, after a 4-3 vote defeated the motion

Sylvan Lake RCMP are looking for the identity of the suspect who stole from over 40 resident mail boxes. (Photo Courtesy of Sylvan Lake RCMP)
Over 40 mailboxes broken into at Sylvan Lake apartment building

Sylvan Lake RCMP are investigating the incident and searching for the identity of the suspect

Ten-month-old Aidan Deschamps poses for a photo with his parents Amanda Sully and Adam Deschamps in this undated handout photo. Ten-month-old Aidan Deschamps was the first baby in Canada to be diagnosed with spinal muscular atrophy through Ontario’s newborn screening program. The test was added to the program six days before he was born. THE CANADIAN PRESS/HO, Children’s Hospital Eastern Ontario *MANDATORY CREDIT*
First newborn tested for spinal muscular atrophy in Canada hits new milestones

‘If Aidan had been born any earlier or anywhere else our story would be quite different’

People line up at a COVID-19 assessment centre during the COVID-19 pandemic in Scarborough, Ont., on Wednesday, December 2, 2020. Toronto and Peel region continue to be in lockdown. THE CANADIAN PRESS/Nathan Denette
COVID-19 vaccine approval could be days away as pressures mount on health-care system

Many health officials in regions across the country have reported increasing pressures on hospitals

A logo for Netflix on a remote control is seen in Portland, Ore.,Aug. 13, 2020. Experts in taxation and media say a plan announced Monday by the government will ultimately add to the cost of digital services and goods sold by foreign companies. THE CANADIAN PRESS/AP-Jenny Kane
‘Netflix tax’ for digital media likely to raise prices for consumers, experts say

The government says Canadian companies already collect those taxes when they make digital sales

Gaming content was big on YouTube in 2020. (Black Press Media files)
What did Canadians watch on Youtube during isolation? Workouts, bird feeders

Whether it was getting fit or ‘speaking moistly,’ Canadians had time to spare this year

A teacher places the finishing touches on the welcome sign at Hunter’s Glen Junior Public School which is part of the Toronto District School Board (TDSB) during the COVID-19 pandemic in Scarborough, Ont., on Sept. 14, 2020. THE CANADIAN PRESS/Nathan Denette
Hindsight 2020: How do you preserve a year many Canadians would rather forget?

Figuring out how to preserve the story of the pandemic poses a series of challenges

Team Manitoba celebrate after defeating Team Ontario to win the Scotties Tournament of Hearts in Moose Jaw, Sask., Sunday, Feb. 23, 2020. Curling Canada wants Calgary’s Canada Olympic Park to be a curling hub for the season’s top events. THE CANADIAN PRESS/Jonathan Hayward
Calgary facility set to become curling hub during pandemic

Curling Canada has provisional approval for Calgary’s hub-city concept from Alberta Health

Ash and Lisa Van carry a freshly cut Christmas tree while wearing personal protective masks at a Christmas Tree Farm in Egbert, Ontario, Sunday, Nov. 29, 2020 THE CANADIAN PRESS/ Cole Burston
‘Everyone wants a tree and they want it now’: Christmas tree sales on pace for record

Anticipated demand for Christmas trees has sparked a rush by some to purchase more trees wholesale

Most Read