TORONTO — Canada's largest stock index nose-dived Tuesday while U.S. stocks slumped as the price of oil saw its biggest single-day drop since October.
The S&P/TSX composite index retreated 113.13 points to 15,913.13, with the energy sector leading the broad-based decline as the December crude contract fell US$1.06 to US$55.70 per barrel.
In New York, the Dow Jones industrial average was down 30.23 points to 23,409.47. The S&P 500 index edged back 5.97 points to 2,578.87 and the Nasdaq composite index lost 19.73 points to 6,737.87.
"We're seeing continuing weakness in global markets. We've seen that all the major markets have kind of retreated from the highs that were set earlier in the month," said Todd Mattina, chief economist and strategist at Mackenzie Investments.
"The decline in oil prices is really weighing on energy sectors in global markets, which of course is very important for the Canadian market."
Mattina said a dovish report on Tuesday from the International Energy Agency has played a role in softening energy prices. The report said that growth in U.S. oil outputs is supposed to be very strong, with very rapid growth expected between now and 2025.
"We've seen a very impressive rally in oil prices recently which has been driven by hopes of continued OPEC production cuts as well as the uncertainty around the political drama in Saudi Arabia," Mattina said.
"But today we're seeing a step back from that as there's been a forecast of warmer than normal weather as well as very robust production in the U.S. over the coming years."
In currency markets, the Canadian dollar was trading at 78.54 cents US, down 0.31 of a U.S. cent from last Friday.
Elsewhere in commodities, the December gold contract was up US$4.00 to US$1,282.90 an ounce. The December natural gas contract gave back seven cents to US$3.10 per mmBTU and the December copper contract declined five cents to US$3.07 a pound.
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David Hodges, The Canadian Press