TORONTO: Toronto's main stock index fought back from a steep drop earlier on Wednesday, guided into positive territory by strength in the gold and base-metal mining sectors.
The resource-heavy materials group gained nearly 3 percent, helped higher by strength in Goldcorp, up 6.3 percent at C$38.17, and Barrick Gold, which climbed 4.8 percent at C$40.28. Diversified miner Teck Resources added 3.1 percent at C$30.92.
"The disconnect between gold prices and the gold group has been widening. At some point, it gets to the point where the discount is simply too enticing especially if you believe that in the longer term gold will do well because of all the stimulus in the global economy," said Elvis Picardo, strategist at Global Securities in Vancouver.
"Investors are getting a jump on a group that has been fairly beaten down disproportionately in recent months."
The gold subgroup was up nearly 4 percent, while the mining subsector was up 2 percent.
At 3:15 p.m. (1915 GMT), the Toronto Stock Exchange's S&P/TSX composite index was up 28.04 points, or 0.24 percent, at 11,479.82. Three of the index's main sectors were higher.
Earlier, the index skidded 1.7 percent on worries about Greece's possible exit from the euro zone. The mining subgroups gained even as the price of gold and base metals sank amid broader market unrest, which saw the euro and overseas and US stocks plummet.
Gold fell more than 2 percent on Wednesday as a wave of selling triggered by better-than-expected US home sales and heightened by despair surrounding the euro zone sent prices toward key technical support levels and wiped out year-to-date gains.
Copper fell in London to a 4-1/2-month low and sank to a fresh 2012 trough in New York.
Comments
Comments are closed.