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Dow, S&P 500 hit third consecutive day of record highs, TSX falls

TORONTO – The price of gold hit its lowest point in more than nine months Wednesday, dragging down the Toronto Stock Exchange as two major American markets continued their record-breaking streak for the third day in a row.

The December contract for gold fell $21.90 to US$1,189.30 per ounce. The last time gold prices settled below that was Feb. 5 at $1,157.70 per ounce.

“Gold (is) really taking it on the chin,” said Cynthia Caskey, a portfolio manager at TD Wealth.

It has now dropped below “that psychologically important” US$1,200 an ounce mark, which represents the middle of the trading range.

The gold sector was the biggest drain on Toronto’s S&P/TSX, which lost 19.47 points to 15,080.91. Bullion stocks fell an average of more than four per cent.

“At this point in time, the headwinds are against gold, not for it,” said Caskey, adding that its sliding price is partly a reaction to the strengthening U.S. dollar.

Increasing anticipation that the U.S. Federal Reserve will announce an interest rate hike at its next two-day meeting starting Dec. 13 has also dimmed the precious metal’s shine, she said.

Pointing to recent economic data, including a Commerce Department report released Wednesday that showed orders for durable goods rose 4.8 per cent in October, Caskey said she expects that Fed chairwoman Janet Yellen will announce a rate hike. That “seals the deal,” she said.

In New York, meanwhile, two major indices continued to break records this week.

The Dow Jones industrial average hit its third straight day of highs, rising 59.31 points to 19,083.18, as did the S&P 500 with a meagre advance of 1.78 points to 2,204.72.

The Nasdaq composite, however, couldn’t sustain its momentum from Tuesday’s close when it recorded a second straight day of record highs. It fell 5.67 points to 5,380.68.

In commodities, the January crude contract slipped by seven cents to US$47.96 per barrel.

Oil prices are in a holding pattern, said Caskey, awaiting a Nov. 30 OPEC meeting when it’s expected that members of the Organization of the Petroleum Exporting Countries will announce an agreement to cut the production of crude.

There’s also concern over whether U.S. president-elect Donald Trump will have a positive or negative impact on the price of oil, she added.

Both of these tensions kept investors on the sidelines Wednesday, she said.

Elsewhere, January natural gas rose 4.7 cents to US$3.15 per mmBTU and December copper contracts gained 6.3 cents to US$2.61 a pound.

The Canadian dollar was at 74.10 cents US, down 0.23 of a U.S. cent.

Follow @AleksSagan on Twitter.