Dec 24 (Reuters) - Canada's main stock index fell on Wednesday with thinner-than-usual trading volumes in a shortened Christmas Eve session, following two successive record highs.
The S&P/TSX composite index (.GSPTSE), was down 0.3% at 31,981.98 points by 10:11 a.m. ET, retreating from the record peaks achieved on Monday and Tuesday when oil and mining shares propelled the market higher despite data revealing a sharper-than-expected contraction in the Canadian economy.
Toronto markets will close early at 01:00 p.m. ET on Wednesday for Christmas Eve and trading volumes are likely to be light throughout the day.
Gold mining stocks (.SPTTGD), emerged as the day's weakest performers, declining 1.6%, while the mining sub-index (.GSPTTMT), dropped 1.5%. The pullback comes even as gold and copper prices were hovering near all-time highs, with both sub-indexes having more than doubled in value this year.
"The risk of a major drop in the gold price would seem largely linked to a slowing of outright gold buying ... barring such an event, investor positions suggest that the extraordinary surge in gold prices is likely to continue," said economists at Societe Generale in a note.
With just one week left in the year, the Canadian benchmark is poised for its best performance since 2009, with a nearly 30% gain.
The heavyweight financial sector (.SPTTFS), which has surged 31% this year, edged up 0.2% during Wednesday's session.
Looking ahead, market observers expect the next Federal Reserve chair to adopt a dovish stance, keeping U.S. monetary policy at the forefront of investment considerations, while analysts project a positive outlook for metal prices in the medium to long term.
"The upcoming appointment of a likely more dovish Federal Reserve chair, which we expect will weaken the (U.S. dollar) and prop up gold, offers further support for our stance," Societe Generale economists said.
Reporting by Avinash P and Ragini Mathur in Bengaluru; Editing by Sahal Muhammed
