TSX stumbles as greenback rally hurts commodity players
By Alastair Sharp
TORONTO (Reuters) - Canada's main stock index stumbled on Tuesday as gold miners, banks and energy companies led a broad sell-off that had value investors cheering as data reminded the market that U.S. interest rates will eventually rise.
With a long period of low borrowing costs, money has sloshed into equities, one portfolio manager said. Some of the froth could be removed with each economic report that prompts the U.S. Federal Reserve closer to a rate hike.
"Markets are expensive and I've got cash, so I'm thrilled," said Norman Levine, managing director at Portfolio Management Corp. "I've got stuff I want to buy and I'd love to see the markets come down."
The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE lost 136.59 points, or 0.90 percent, to 15,050.81 for its biggest one-day drop in several weeks. Of the 10 main sectors, only info tech gained.
"We're not negative, we just think we're long, long overdue a correction (in North American markets)," Levine said.
Among the heaviest weights were several major banks - which all report earnings this week - as well as blue-chip oil and gas names and major global gold miners.
But the pullback was also deep, with declining issues outnumbered advancing ones by more than 6-to-1.
After a lackluster first quarter, the U.S. economy was showing signs of getting back on track, the latest indicator being better-than-expected durable goods orders.ECONUS Continued...