Energy and mining stocks — especially the gold miners — led a substantial pull-back for the TSX on Tuesday as a broad-based sell-off hit most sectors.
The S&P/TSX composite index fell 134 points, or 1.1 per cent, to close at 12,469 as the exchange reopened for business following the long Civic Holiday weekend.
At one point during morning trading, the benchmark TSX index was off by 184 points — hitting its lowest level in more than three weeks.
"There's still enough basic nervousness in the market that people are just as quick to pull the trigger as they ever were," said David Cockfield, managing director at Northland Wealth Management.
"The market is just biding its time," he said. "We may not get a real direction until we get a few more people back in the saddle."
Every sector except information technology was in the red. BlackBerry shares rose 62 cents to $9.89, lifitng the tech sector. Samsung announced that BlackBerry Messenger was being made available to its Android smartphones in Africa "soon."
Energy stocks fell as the price of crude oil reversed earlier gains and retreated $1.26 a barrel to settle at $105.30 US.
But it was gold stocks that slumped the most as bullion futures dropped $20 an ounce to $1,282 US.
Barrick Gold and Goldcorp both fell more than six per cent. But smaller producers like Centerra Gold (down 13 per cent) and NovaGold Resources (down 11.2 per cent) slumped by double-digits.
Dow tumbles on Fed fears
The Dow Jones industrial average tumbled 93 points to 15,519.
Shares of Dow component IBM slid 2.3 per cent to $190.99 following reports that the company would require some workers to take time off as hardware sales slow. Credit Suisse also cut its rating on the company.
U.S. stocks fell even as the U.S. reported record exports in June and a much lower than expected trade deficit. New data also showed that U.S. home prices are rising sharply.
U.S. investors appear to be revisiting worries that the U.S. Federal Reserve could begin to taper its monthly purchases of bonds as early as September. The Fed's assets purchases have been credited with much of the power behind the recent strength in U.S. stocks.
The Dow has risen for the last six weeks in a row.