With the price of crude oil tumbling to its lowest level in nearly two months, it might not come as a surprise to learn that energy stocks were among the biggest drags on North American stock market indexes at midday on Thursday.
At noon, the S&P/TSX composite index was down 11,310, down 208 points or 1.8 per cent - on track to post its biggest one-day setback in more than a month.
All 10 subindexes were down, suggesting a widespread selloff. However, Energy stocks led the way, falling 2.6 per cent after the price of crude oil fell to $66.35 (U.S.) a barrel, down $2.62 - marking its third significant decline in the four trading days this week.
Materials fell 2 per cent after the price of gold switched directions and fell more than $15 an ounce, taking it to $999. Financials fell 1.8 per cent.
In the United States, the declines were less severe, due to the fact that commodities have a lower weighting within the major indexes. Dow Jones industrial average fell 53 points or 0.5 per cent, to 9,696. The broader S&P 500 fell 10 points or 1 per cent, to 1051.
All 10 subindexes were down here as well. Despite a disappointing report on U.S. existing home sales for August, commodity producers led the way down with materials falling 2 per cent and materials falling 1.7 per cent.
Indeed, the economically cyclical areas of the market were hit far harder than the more defensive areas - even as lower-than-expected jobless claims for last week fell lower than expected, suggesting some stabilizing within the U.S. labour market. Industrials fell 1.6 per cent while consumer discretionary stocks and financials fell about 1 per cent each.
By comparison, defensives fared okay. Utilities fell less than 0.1 per cent, consumer staples fell 0.4 per cent and health care stocks fell 0.6 per cent.