TORONTO -- A late surge helped the loonie regain ground after it briefly dipped below 75 U.S. cents on Wednesday.

The Canadian dollar traded at an average of 75.06 cents U.S. on Wednesday, down from an average of 75.45, despite dipping to an intraday low of 74.95 U.S. cents shortly after noon ET.

Canada's main stock index outperformed its U.S. counterparts Wednesday as the price of gold surpassed US$1,500 an ounce for the first time in more than six years amid growing concerns about an economic slowdown.

The S&P/TSX composite index closed up 115.73 points to 16,265.22 after reaching an intraday low of 16,064.34.

"It's a surprisingly good day but it rested quite heavily on the materials sector and to some extent the fear trade insofar as gold and silver, precious metals are what's driving the TSX," said Giles Marshall, portfolio manager at Fiduciary Trust Canada.

The December gold contract was at US$1,519.60 an ounce, up US$35.40 from Tuesday and the September copper contract was up 1.35 cents at US$2.57 a pound.

Nine of the 11 major sectors of the TSX rose, led by consumer discretionary, materials and real estate.

Materials was helped by a 6.1 per cent gain by First Majestic Silver Corp along with gains by Kinross Gold Corp. and Barrick Gold Corp.

SNC-Lavalin Inc. closed more than six per cent higher after an Ontario judge cleared the embattled engineering firm to proceed with the $3.25-billion sale of a stake in Ontario's 407 toll highway to the Canada Pension Plan Investment Board (CPPIB), paving the way for the beleaguered company to pay off hundreds of millions in debt.

Health care lost 0.7 per cent while energy was down 0.45 per cent as NuVista Energy Ltd. lost 13.5 per cent and Crescent Point Energy Corp. was off 3.6 per cent.

The sector took a hit as the price of crude oil fell on higher U.S. stockpiles and concerns about a weakening global economy.

The September crude contract was US$51.09, down US$2.54 per barrel from Tuesday and the September natural gas contract was down 2.8 cents at US$2.08 per mmBTU.

In New York, markets recovered from large morning declines. The S&P 500 closed up 2.21 points to 2,883.98. The Dow Jones industrial average dropped 22.45 points to 26,007.07 after initially losing 374 points or 1.4 per cent, while the Nasdaq rose 29.56 points to 7,862.83.

Gold is outpacing stock markets as investors seek safety and a trade war between the U.S. and China puts pressure on the Federal Reserve to further cut interest rates.

"Every central bank in the world has already cut interest rates or is in the process of cutting interest rates, so there's a very high probability that the Bank of Canada will cut rates before the end of this year," Marshall said in an interview.

Bond yields fell with the Canadian and U.S. 10-year treasuries hitting their deepest inversion curves since 2000 and 2007 respectively.

"Historically it's been a pretty good predictor of recession so this is clearly weighing on sentiment and people are recalibrating their expectations for growth over the second half of the year."

With files from BNN Bloomberg