TORONTO (Reuters) - Canada’s main stock index dropped to its lowest in more than a week on Wednesday as a U.S. Federal Reserve report gave few new signals on the central bank’s plans for its monetary stimulus program.
Every major sector on the index ended in the red, and gold-mining shares showed one of the sharpest declines on the resource-heavy index, falling with bullion prices.
The market brushed aside figures showing U.S. home resales climbed in July to their highest level in more than three years, and trained its sights instead on the midafternoon release of minutes from the Fed’s last policy meeting.
The minutes showed that a few Fed officials thought last month that it would soon be time to slow the pace of the central bank’s stimulative bond-buying program “somewhat”, but others counseled patience.
“Investors are now worried about what will be cut back first: will it be mortgage-backed securities or the federal bonds?” said Sal Masionis, a stockbroker at Brant Securities.
“You can’t be living on these very low interest rates as you’re going to have asset bubbles,” he added.
The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE closed down 97.03 points, or 0.77 percent, at 12,573.08 after falling as low as 12,542.84, its lowest level since August 12.
Financials, the index’s most heavily weighted sector, slipped 0.3 percent. Royal Bank of Canada (RY.TO), the country’s biggest lender, gave back 0.2 percent to C$64.58; Bank of Nova Scotia (BNS.TO) was down 0.2 percent at C$58.28.
The materials sector, which includes mining stocks, lost 3 percent, with gold producers falling 3.5 percent.
In company news, Sears Canada Inc SCC.TO reported a decline in quarterly revenue and said it plans to cut 245 jobs. The stock fell 1.8 percent to C$12.05.
Editing by Peter Galloway