Canada’s benchmark Toronto Stock Exchange (TSX) dropped more than 1,000 points on Jan. 30 amid a sudden and steep reversal in gold and silver prices.
The mining-heavy Toronto Stock Exchange got clobbered as the price of silver plunged 30% and gold’s price declined 10% after U.S. President Donald Trump named Kevin Warsh to lead the U.S. Federal Reserve.
The Toronto Stock Exchange lost 1,092.61 points to close at 31,923.52 on Jan. 30 as shares of gold and silver miners fell sharply.
The stock of Barrick Mining (ABX) fell 11% on the day. Other mining stocks such as Agnico Eagle Mines (AEM) and Franco-Nevada (FNV) fell 10% or more.
At the same time, the Canadian dollar lost more than half a cent to trade at 73.74 cents U.S. compared with 73.99 cents U.S. the previous day.
The Canadian dollar had been rising against the greenback to start the year and its decline was also jarring for investors and financial markets.
The quick unwinding of gold and silver prices comes as Trump’s choice of Warsh helped to ease concerns about the future independence of the U.S. Federal Reserve.
Gold and silver prices had been on a tear over the past year, with each precious metal seeing its price more than double.
Gold’s price recently rose above $5,000 U.S. an ounce for the first time, while silver’s price climbed above $100 U.S. an ounce.
In early trading on Feb. 2, the prices of both gold and silver appear to be rebounding from the selloff, with gold up 1% and silver up 7% in premarket trading.
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