Although they tried, the gold miners couldn’t drive the Canadian market to another down day on Tuesday. The S&P/TSX Composite gained about 115 points to finish the day up 0.96%.
Even though the spot price of gold made a slight recovery, gaining 1.6%, the miners once again faced significant selling pressure. Barrick Gold (TSX:ABX,NYSE:ABX) was the worst of the large caps, checking in with another decline greater than 5%.
Counteracting the sector that seemingly everybody loves to hate was a collection of blue chip financial names. All of the banks had a good day with the Bank of Nova Scotia (TSX:BNS,NYSE:BNS) and TD Bank (TSX:TD,NYSE:TD) making significant contributions to the index with their returns of 1.4% and 1.3% respectively.
Sunlife (TSX:SLF,NYSE:SLF) and Brookfield Asset Management (TSX:BAM.A,NYSE:BAM), with respective returns of 3.1% and 2.3%, also chipped in to fight the negative strain brought on by the golds.
Aside from gold stocks, resources had a decent day as well. First Quantum (TSX:FM) had a nice bounce, up over 9%, and heavy weight Suncor Energy (TSX:SU,NYSE:SU) was in fact the top contributor to the Canadian market, up a bit more than 3%.
Even Blackberry (TSX:BB,NASDAQ:BBRY) joined in on the fun. The stock turned in a gain of 1.4% thanks to a favourable analyst report.
Without participation from the gold sector, it will be a challenge for the rest of the Canadian market to really make any headway. However, the bounce that occurred today was a welcome respite from the negative spiral that we had seemingly entered.
The S&P/TSX Composite Index is loaded with resource and financial stocks. Because of this, investors that rely on Canadian Index funds or ETFs severely lack diversification in their portfolio, opening them to undue risks. We have created a special report that outlines an easy to implement strategy and 5 Canadian stocks that reduce the risks involved with passively investing in the Canadian market. Click here now to receive “Buy These 5 Companies Instead of Following a Flawed Piece of Advice” – FREE!
Fool contributor Iain Butler owns shares of Barrick Gold. The Motley Fool has no positions in the stocks mentioned above.
This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.