BUSINESS

Energy, Gold Stocks Lead Triple-Digit TSX Drop

08/06/2013 12:05 EDT | Updated 10/06/2013 05:12 EDT
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TSX MERGER--12/10//07--Monitor inside the TSX broadcast centre located on the ground floor of The Exchange Tower on King Street West in Toronto's financial district, December 10, 2007. TSX Group Inc. agreed to buy Montreal Exchange Inc. for about C$1.31 billion ($1.3 billion) in cash and stock, combining Canada's equity and derivatives exchanges. (Andrew Wallace/Toronto Star)anw (Photo by Andrew Francis Wallace/Toronto Star via Getty Images)
Energy and mining stocks — especially the gold miners — led a substantial pull-back for the TSX on Tuesday as a broad-based sell-off hit most sectors.

The S&P/TSX composite index fell 176 points, or 1.4 per cent, to 12,427 in mid-morning trading as the exchange reopened for business following the long Civic Holiday weekend.

That's the lowest level for the benchmark TSX index in more than three weeks.

"There's still enough basic nervousness in the market that people are just as quick to pull the trigger as they ever were," said David Cockfield, managing director at Northland Wealth Management.

"The market is just biding its time," he said. "We may not get a real direction until we get a few more people back in the saddle."

Every sector except information technology was in the red.

Energy stocks fell as the price of crude oil reversed earlier gains and retreated $1.39 a barrel to $105.17 US.

But it was gold stocks that slumped the most as bullion futures dropped $20 an ounce to $1,282 US.

Barrick Gold and Goldcorp both fell almost five per cent. Smaller producers like Centerra Gold and Novagold Resources slumped almost eight per cent.

Dow tumbles on Fed fears

The Dow Jones industrial average tumbled 117 points to 15,495.

U.S. stocks fell even though the U.S. reported record exports in June and a much lower than expected trade deficit. New data also showed that U.S. home prices are rising sharply.

U.S. investors appear to be revisiting worries that the U.S. Federal Reserve could begin to taper its monthly purchases of bonds as early as September. The Fed's assets purchases have been credited with much of the power behind the recent strength in U.S. stocks.

The Dow has risen for the last six weeks in a row.

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