* Seven of TSX's 10 main industry groups were down
By Solarina Ho
TORONTO, Aug 9 (Reuters) - Canada's benchmark stock index fell on Wednesday as heightened tensions between North Korea and the United States drove investors away from higher-risk assets and toward safe havens, such as gold.
Valeant Pharmaceuticals International, and the heavily weighted financials group lead broad declines.
Valeant's stock, which rallied a day before following quarterly results, sank 9.6 percent to C$17.85 after it said its subsidiaries in Australia were the subject of a tax audit.
Overall, the healthcare sector slumped 3.4 percent. Some of Canada's biggest banks were also influential decliners, but closed with only moderate losses.
Manulife Financial Corp was down 1.1 percent to C$25.64. The umbrella financials group slipped 0.3 percent.
Investors are losing enthusiasm for Canada's banking stocks as a slowdown in the country's housing market dents banks' growth prospects, with insurance companies seen as a better bet to benefit from higher interest rates.
The Toronto Stock Exchange's S&P/TSX composite index fell 39.02 points, or 0.26 percent, to end at 15,217.33. Of the index's 10 main sector groups, seven finished in the red.
The index's losses mirrored global markets, which fell after incendiary words between the United States and North Korea. President Donald Trump said on Tuesday that U.S. threats from Pyongyang would be met with "fire and fury," which prompted North Korea to say it was considering plans for a missile strike on the U.S. pacific territory of Guam.
"People are concerned that a shouting match could lead to someone pressing a button," said Irwin Michael, portfolio manager at ABC Funds. But Michael said the overall market was still expected to saw-tooth its way higher due in part to a batch of better-than-expected earnings and low interest rates, despite the shift toward raising rates. "We do believe the trend is still up."
Energy stocks retreated 0.5 percent, despite higher oil prices.
Information technology fell 1.24 percent, hurt by a 16.6 percent plunge to C$66.50 in Kinaxis Inc stock. Kinaxis shares fell after the supply chain management software maker cut its forecast.
Offsetting the declines was a 0.4 percent gain by the materials group, which includes gold producers. The precious metal miners benefited from the flight to safety, with bullion prices hitting near two-month highs on North Korean worries.
Franco Nevada Corp rose 3.9 percent to C$95.65, while Barrick Gold Corp was up 1.9 percent at C$21.26.
Declining issues outnumbered advancing ones on the TSX by 161 to 87, for a 1.85-to-1 ratio on the downside. (Reporting by Solarina Ho, editing by G Crosse)