BENGALURU: Canada’s main stock index fell to a near seven-month low as a decline in gold and oil prices dragged commodity-linked shares down, with a sharp rise in benchmark US Treasury yields also taking toll on dividend-paying sectors like utilities.
At 10:53 a.m. ET (1453 GMT), the Toronto Stock Exchange’s S&P/TSX composite index was down 287.38 points, or 1.47%, at 19,253.89, hitting its lowest levels since March 16 to begin the final quarter of the year on a dismal note.
The benchmark index lost 3.7% in September and 3% for the third quarter.
Materials sector, which includes miners and fertilizer companies, dipped 2.6% as gold extended its decline for the sixth straight session and silver slid to a more-than-six-month low.
The energy sector dropped more than 2%, tracking a decline in global benchmarks Brent crude oil and US West Texas Intermediate crude (WTI) futures.
Rate-sensitive utilities fell nearly 3%, leading declines amid a dramatic run-up in 10-year US Treasury yields that hit 16-year highs.
“US Treasury yields continue to march higher and that’s just crushing the dividend-paying stocks like utilities in Canada,” said Douglas Porter, chief economist of BMO Capital Markets.
Data showed Canada’s manufacturing sector downturn deepened in September to its lowest level since shortly after the start of the COVID-19 pandemic as weak market demand weighed on production and new orders.
The S&P Global Canada Manufacturing Purchasing Managers’ Index (PMI) fell to a seasonally adjusted 47.5 last month, from 48.0 in August.
Industrials stocks fell 0.8%.
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