(Reuters) -Canada's main stock index pulled back from a record high on Wednesday as long-term borrowing costs climbed and investors took stock of recent gains for the market.
The Toronto Stock Exchange's S&P/TSX composite index ended down 214.46 points, or 0.8%, at 25,839.17, after posting a record closing high on Tuesday.
The decline ended a 10-day winning streak for the market, the longest such run since October 2021.
"Yields have popped up, which has caused some concern for investors and I think also just a pause based on the recent strength in the market," said Stan Wong, a portfolio manager at Scotia Wealth Management.
The Canadian 10-year yield rose 8.4 basis points to 3.382%, its highest level since January 16, as investors reduced bets on Bank of Canada interest rate cuts after domestic data on Tuesday showed underlying inflation heating up in April.
U.S. Treasury yields also climbed as investors monitored the progress of a tax bill in the U.S. Congress that could swell the government's debt load.
The interest-rate sensitive real estate sector fell 2.1% and technology ended down 2.3%. Higher bond yields reduce the value to investors of the long-term cash flows that high-growth tech stocks are expected to produce.
Heavily weighted financials lost 1% ahead of the start on Thursday of earnings season for Canada's big banks. The lenders are bracing for trade uncertainty and are expected to have shored up loan loss reserves in the second quarter.
The materials group, which includes metal mining shares, was the only one of 10 major sectors to end higher, adding 1.3%.
"Gold prices are near record highs and that's brought a lot of momentum to the sector," Wong said.
Shares of Canada Goose Holdings Inc jumped 19.1% after the luxury retailer reported stronger-than-expected quarterly sales.
(Reporting by Fergal Smith in Toronto and Sanchayaita Roy in Bengaluru; Editing by Sahal Muhammed and Sandra Maler)
By Fergal Smith
