TORONTO (Reuters) - Canada’s main stock index fell on Tuesday after an easing of tensions between North Korea and the United States hit the price of bullion, dragging down shares of gold-mining companies.
North Korea this week indicated that a plan to fire missiles near Guam, a U.S. territory in the Pacific, was not imminent, easing worries about geopolitical tensions in the region for the moment.
The improving North Korean situation sent investors away from gold, seen as a safety net for investors during periods of volatility, to riskier assets.
Gold had rallied over the past two weeks after a standoff between Pyongyang and Washington escalated, reaching a two-month high of $1,291.86 on Friday.
“Rhetoric about North Korea has come down, and that has alleviated market volatility,” said John Ing, president of Maison Placements Canada.
The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE closed down 22.07 points, or 0.15 percent, at 15,097.84. Six of the 10 main sectors on the index were lower.
Data released on Tuesday showed lending to Canadian small businesses rose for a fifth straight month in June on stronger activity in construction and other major industries.
Specialty food company Premium Brands Holdings Corp (PBH.TO) rose 3.3 percent to C$99.63 as several analysts increased their price targets following an earnings beat.
Grocery chain Metro Inc (MRU.TO) lost 0.6 percent to C$42.64 after reporting lower same-store sales and third-quarter earnings that missed expectations.
The materials group, which includes precious and base metals miners and fertilizer companies, lost 0.4 percent.
Reporting by Alastair Sharp and John Tilak; Editing by W Simon and Richard Chang