U.S. stocks fell slightly on Tuesday and Canadian stocks rose a touch, as markets digested rising European bond yields and a downward revision to U.S. economic growth in the third quarter.
The Dow Jones industrial average closed at 11,493.72, down 53.59 points or 0.5 per cent. The broader S&P 500 closed at 1188.04, down 4.94 points or 0.4 per cent. In Canada, the S&P/TSX composite index closed at 11,795.19, up 10.47 points or 0.1 per cent.
The mild moves contrasted to the big swings seen on Monday, when investors ran from stocks and embraced U.S. government bonds as haven investments. Yet, the backdrop wasn’t much different on Tuesday. An auction of six-month Spanish government bonds saw yields rise sharply, fanning the usual concerns about some European countries being unable to finance themselves.
At the same time, the Commerce Department revised its reading on U.S. economic growth last quarter, to 2 per cent from 2.5 per cent previously – and below economists’ expectations.
Among U.S. stocks, economically sensitive stocks were generally the biggest laggards, with poor performances by energy stocks and financials in particular. Bank of America Corp. fell 2.2 per cent and JPMorgan Chase & Co. fell 1.7 per cent.
Defensive stocks held up better, with gains from McDonald’s Corp. and Kraft Foods Inc.
In Canada, Research In Motion Ltd. fell 2.9 per cent to a new 52-week low. Among energy stocks, Suncor Energy Inc. fell 1.7 per cent. Financials rose modestly, with Royal Bank of Canada up 1.1 per cent and Bank of Nova Scotia up 0.3 per cent.
Meanwhile, materials showed the biggest gains, with strong moves by gold producers. Barrick Gold Corp. rose 2.2 per cent after the price of gold rose to $1,702.40 (U.S.) an ounce, up $23.80. Gold had fallen sharply on Monday.