U.S. markets sank deeply into the red Tuesday, while precious metals and the materials sector helped mitigate the fall at Canada’s main stock index.
The S&P/TSX composite index closed down 75.06 points to 15,477.
In the U.S., the Dow Jones industrial average plunged by 424.56 points to close at 24,024.13. The S&P 500 index closed down 35.73 points to 2634.56 and the Nasdaq composite index closed down 121.25 points to 7,007.35.
Underlying the selloff in U.S. markets was the benchmark U.S. 10-year Treasury yield touching the “psychological level” of 3%, said Luc de la Durantaye, managing director of asset allocation and currency at CIBC Asset Management.
“That probably unnerves the market a little bit,” he said.
He added that concerns over U.S. interest rates were further compounded by investor concerns about specific companies, such as Google parent Alphabet, whose shares slid nearly 5% on higher-than-expected capital spending.
In Canada, however, the materials and gold sector remained buoyant. Barrick Gold Corp. shares were up more than 3% Tuesday on better-than-expected quarterly earnings and the Toronto-based miner’s announcement that it is no longer selling off assets to pay down debt.
“Gold is up … That’s certainly helping the market to stay afloat a bit better than in the U.S.,” said de la Durantaye.
The Canadian dollar was trading at US77.95¢, up from an average value of US77.92¢ on Monday.
The June gold contract was up US$9 to US$1,333 an ounce and the May copper contract was up US3¢ to US$3.14 a pound.
The June crude contract was down US94¢ to US$67.70 per barrel and the June natural gas contract was up US4¢ to US$2.81 per mmBTU.