Canada’s main stock index partially rebounded Tuesday after falling to a six-month low in early trading, while oil prices closed at a two-month low.

Markets on both sides of the border were on a roller coaster ride, initially sinking deep into the red on geopolitical concerns out of Italy and Saudi Arabia and in response to a corporate earnings reports from Caterpillar Inc. and 3M Co.

The weak opening followed a European Commission’s rejection of Italy’s budget, which will force the government to revise and re-submit it over the next three weeks or so.

Risks from the fallout from Saudi Arabia’s alleged involvement in the death of a journalist at its consulate in Turkey also caused concerns, along with the repercussions from the upcoming presidential vote in Brazil, says Dominique Barker, portfolio manager at CIBC Asset Management.

Far-right candidate Jair Bolsonaro, who is the front-runner in polls, has vowed to purge the country of left-wing “criminals.” That raises questions about the post-election outcome of a government headed by a former military leader.

“So Brazil continues to be a risk that I am personally monitoring from a geopolitical perspective,” she said in an interview.

The S&P/TSX composite index closed down 127.53 points to 15,285.17 after losing 2% or 318 points in morning trading.

Gold, consumer staples, utilities and consumer discretionary sectors rose while health care, base metals and key sectors of energy, industrials and materials led on the downside.

The biggest names in the marijuana business extended recent weakness early in the day but trimmed their losses in final trading.

Aurora Cannabis Inc., which debuted on the New York Stock Exchange, was down as much as 19.3% on the U.S. market and closed off 99¢ or 11.39% to US$7.70. Aurora shares lost $1.34 or 11.7% to $10.08 on the Toronto Stock Exchange.

Canopy Growth Corp. closed down 1.5%, after being down as much as 11.6% on the day. Aphria Inc. rose 0.7% after initially losing 12.7%.

In New York, the Dow Jones industrial average lost 125.98 points at 25,191.43 after being down as much as 548.62 points. The S&P 500 index was down 15.19 points to 2,740.69, while the Nasdaq composite was down 31.09 points at 7,437.54.

While U.S. corporate results this quarter have been strong, shares of Caterpillar Inc. lost 7.6% after analysts were told during a conference call that growth can’t continue forever, signalling a moderation in growth expectations, said Barker.

“One of the things we’ve been seeing in this earnings season, which is quite a change from recent memory, is that good news is being interpreted negatively, so no matter what you say, even if you’ve got good news, it seems like there’s some skepticism by the market.”

In Canada, West Fraser Timber’s shares surged after the Vancouver-based producer said its third-quarter profit doubled despite lower lumber prices.

The Canadian dollar traded at an average of US76.35¢ compared with an average of US76.31¢ on Monday.

The December crude contract was down US$2.93 at US$66.43 per barrel, the lowest level since August.

Oil prices decreased after Saudi Arabia said it would produce as much crude as it can, under pressure from U.S. President Donald Trump.

The November natural gas contract was up US7.4¢ at US$3.21 per mmBTU.

The December gold contract was up US$12.20 at US$1,236.80 an ounce and the December copper contract was down US2.75¢ at US$2.76 a pound.