By Fergal Smith
TORONTO (Reuters) - Canada's main stock index fell on Monday, including declines for the utilities sector and gold mining shares, as rising bond yields and worries about the global economic outlook weighed on investor sentiment.
The Toronto Stock Exchange's S&P/TSX composite index ended down 69.78 points, or 0.3%, at 20,692.22.
"The Canadian market is selling off a little bit just because of a global slowdown and everything else going on," said Lorne Steinberg, president, Lorne Steinberg Wealth Management Inc.
Equity markets globally fell after a PMI report from China showed factory activity contracting for the second straight month as widespread COVID-19 shutdowns disrupted production and supply chains.
Adding to pressure on stocks, the U.S. 10-year yield moved above 3% for the first time in more than three years as investors positioned themselves for an expected half-point interest rate hike by the Federal Reserve at the end of a two-day policy meeting on Wednesday.
Still, the TSX clawed back much of its decline after touching its lowest intraday level since Feb. 24 at 20,456.80. Since the start of the year, the commodity-linked market has fallen 2.5%, which is much less than some other major global benchmarks, including the S&P 500.
"We are still pretty bullish on Canada," Steinberg said. "Valuations for things like bank stocks, consumer stocks are still pretty attractive."
The utilities sector fell 1.1% on Monday, extending its pullback from a record high last month, while industrials ended 0.8% lower.
The materials group, which includes precious and base metals miners and fertilizer companies, lost 0.6%. Gold was down 1.8% at about $1,861 per ounce.
"With gold getting hammered ... it's a rocky start to the month for Canadian stocks," said Colin Cieszynski, chief market strategist at SIA Wealth Management.
(Reporting by Fergal Smith; Additional reporting by Amal S in Bengaluru; Editing by Alistair Bell)