Gold miner slump pushes TSX down; banks gain
By Alastair Sharp
TORONTO (Reuters) - Sharp losses among gold miners weighed heavily on Canada's main stock index on Wednesday as the precious metal slid to a nine-month low, with the falls offsetting solid gains for heavyweight banks and more subdued rises across most other sectors.
A slew of gold mining stocks, including two of the world's largest gold producers, fell between 3 and 8 percent. Gold prices slumped as strong U.S. data and the release of minutes from the last U.S. Federal Reserve policy meeting buoyed the U.S. currency to its highest level since 2003 and further cemented a case for increasing U.S. interest rates next month.
Barrick Gold Corp fell 4.5 percent to C$19.72, and Goldcorp Inc declined 4 percent to C$17.41. Kinross Gold Corp lost 8.2 percent to C$4.26.
The materials group, which includes precious and base metals miners and fertilizer companies and accounts for 12 percent of the index's weight, lost 2.6 percent.
"Technically it's weak and fundamentally it's weak," John Kinsey, a portfolio manager at Caldwell Securities, said of the gold price, adding that India's removal of large-denomination rupee notes from circulation earlier this month was an additional headwind.
"That's hurting, it's drying up liquidity. They want to buy gold but they don't have the liquidity," he said.
India's central bank said on Monday that people could withdraw up to 250,000 rupees ($3,670) for wedding-related expenses.
The Toronto Stock Exchange's S&P/TSX composite index settled down 19.47 points, or 0.13 percent, at 15,080.91. The index hit 17-month highs earlier this week. Continued...