TSX falls as gold miners dive after Fed comments

Wed Oct 29, 2014 5:22pm EDT
 
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By John Tilak and Alastair Sharp

TORONTO (Reuters) - Canada's main stock index dropped on Wednesday as gold-mining shares fell with bullion prices after the U.S. Federal Reserve offered an upbeat outlook for jobs and ended its stimulative bond-buying program.

The U.S. central bank closed its monthly asset purchase program and dropped a characterization of U.S. labor market slack as "significant" in a show of confidence in the economy's prospects.

Bullion, which tends to lose its allure as a safe-haven asset when there are bullish economic signals, dived 1.5 percent. Shares of gold miners dropped 4.4 percent.

Investors also digested earnings reports from miners Cameco Corp (CCO.TO: Quote) and Teck Resources Ltd TCKb.TO. Cameco shares dropped 3.3 percent to C$18.92 after the uranium producer said it expected full-year revenue to fall by up to 5 percent due to labor problems at mines.

"Some companies have disappointed, some have managed to hurdle over a pretty low bar as far as earnings expectations (go)," said Elvis Picardo, a strategist at Global Securities in Vancouver.

"On the plus side, Teck, which has really been beaten down in the last few weeks, came out with pretty solid numbers all things considered," Picardo said.

Teck rose 1.8 percent to C$18.16 after the miner reported adjusted third-quarter earnings that topped market expectations.

The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE closed down 96.68 points, or 0.66 percent, at 14,527.57.   Continued...

 
A man walks past an old Toronto Stock Exchange (TSX) sign in Toronto, June 23, 2014.  REUTERS/Mark Blinch