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Gold sector drags down Toronto Stock Exchange's main index

Last Updated Aug 15, 2017 at 5:00 pm EDT

Gold stocks dragged down the Toronto Stock Exchange’s main index as investors turned away from the precious metal.

The S&P/TSX composite index fell 22.07 points to 15,097.84, with the global gold sector being the worst performer of the day. Stocks in the sector lost on average 0.59 per cent of their worth.

The December gold contract shed US$10.70 to US$1,279.70 an ounce.

The price of the commodity, which is seen as a safe haven, lost some of its shine as investors felt less anxious about last week’s nuclear war rhetoric between the United States and North Korea, said Sid Mokhtari, executive director at CIBC Capital Markets.

Gold also weakened amid a strengthening greenback, he said. The Canadian dollar was trading at an average price of 78.40 cents US, down 0.31 of a U.S. cent.

On Wall Street, markets remained relatively flat after Monday’s relief rally that saw the Dow Jones industrial average soar nearly 140 points.

The Dow inched ahead by 5.28 points, falling just shy of breaking the 22,000 mark at 21,998.99.

The S&P 500 index fell a meagre 1.23 points to 2,464.61, while the Nasdaq composite index declined 7.22 points to 6,333.01.

Still, geopolitics remains a risk factor, said Mokhtari.

“It’s still very premature to say that heightened level of anxiety has fully gone away,” he said, adding some volatility measures indicate fear factor remains present in the market.

Elsewhere in commodities, the September crude contract lost US$0.04 to $47.55 per barrel, the September natural gas contract fell 2.4 cents to about US$2.94 per mmBTU and the September copper contract retreated about 2.2 cents to US$2.88 a pound.

By Aleksandra Sagan in Vancouver.

Follow @AleksSagan on Twitter.