As the threat of a vaccine-resistant coronavirus variation dragged oil prices down, Canada’s main stock index was on track for its largest fall since late January, with energy stocks dragging it down by 6%.
At 9:44 a.m. ET (14:44 GMT), the S&P/TSX composite index for the Toronto Stock Exchange, The GSPTSE was down 365.66 points, or 1.69 percent, to 21,247.52 points.
The energy sector .SPTTEN was on course to snap a four-day rally on worries that the variant, which Britain said scientists considered the most significant found to date, could restrict travel and dampen economic growth. O/R
“We can see the big selloff in world markets overnight on the announcement of the new COVID variant and the travel restrictions by some of the countries in Europe,” said Colin Cieszynski, chief market strategist at SIA Wealth.
The benchmark equity index’s record-breaking rally came to a halt last week due to lower commodities prices and a COVID-19 rebound in Europe, which led to further lockdowns in the area.
The financials sector .SPTTFS, which accounts for about 30% of the index’s market value, slipped 2.2%.
The materials sector .GSPTTMT, which includes precious and base metals miners and fertilizer companies, lost 1.1% on weakness in copper prices.
However, a 0.4% rise in gold futures GCc1 helped limit losses for the sector and put a floor under the benchmark index. GOL/
“We could see a rally in gold today and you can see that Canada is getting cushion from gold stocks, that’s why you see the Canadian index is not down quite as much as the U.S. today,” Cieszynski said.
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