Canadian stocks moved higher during trading on Monday

Image Source : Krish Capital Pty Ltd

Index Update:  The S&P/TSX Composite Index rose 0.69% to close at 25,532.18 on Monday, reaching its highest level in twelve weeks as the 90-day US-China tariff rollback reignited appetite for commodities and risk assets. Most sectors were trending higher on Monday, led primarily by gains in consumer durables, tech and commercial services. Of the few decliners, materials stocks were the lowest, as the price gold pulled back after news of easing trade tensions.

Macro Update:  Canada’s labour market posted a modest rebound in April 2025, adding 7,400 jobs, surpassing market expectations of a 2,500 gain and partially offsetting the 32,600-contraction recorded in March. The headline growth was underpinned by a robust 31,500 increase in full-time positions, while part-time employment contracted by 24,200, suggesting a shift toward more stable, higher-quality jobs. At the provincial level, job gains were concentrated in Quebec, Alberta, Manitoba, and Newfoundland and Labrador, while Ontario and Nova Scotia experienced declines. Employment levels remained relatively stable across the remaining provinces. US - China trade negotiations in Geneva over the weekend yielded a breakthrough, with Washington agreeing to reduce its punitive tariffs on Chinese goods from 145% to 30%, while Beijing reciprocated by lowering duties on U.S. imports from 125% to 10%. The détente boosted market sentiment, sending oil and industrial metals prices sharply higher amid expectations of improved global trade flows and industrial demand.

Top Movers and Losers:  The biggest gainers of the session on the S&P/TSX Composite were Shopify Inc (TSX: SHOP), which rose 14.08%. Aritzia Inc (TSX: ATZ) added 9.45% and TFI International Inc (TSX: TFII) was up 9.08%. Biggest losers included Lundin Gold Inc (TSX: LUG), which fell 17.55%. Pan American Silver Corp (TSX: PAAS) declined 15.86% and Orla Mining Ltd (TSX: OLA) down 15.57%.

Our Stance: The index is trading well above its 21-period Simple Moving Average (SMA), reinforcing a bullish outlook with the SMA acting as dynamic support. The Relative Strength Index (RSI) sits at 65.62, suggesting the market is in a strong but not overbought condition, leaving room for continued upside. Key support is established near the 25,200 level. Maintaining this level is essential for sustaining the current uptrend.

Commodity Update:  The dollar remained firm Tuesday after the U.S. and China agreed to a 90-day tariff truce, easing trade war tensions and boosting market sentiment. The deal sparked a global relief rally, lifting stocks and commodities. Gold rose 0.20% to $3,234.50, silver jumped 0.95% to $32.93, and copper increased 0.29% to $9,511.40. However, Brent crude slipped 0.20% to $64.82 amid the improving trade outlook.

Technical Update:  The S&P/TSX Composite Index posted a strong performance on Monday, gaining 174.44 points to close at 25,532.18  a 0.69% increase. The advance was supported by elevated trading volume, indicating solid investor confidence and active buying interest. Leading the rally was the technology sector, which surged 6.41%, reflecting growing optimism in that space. From a technical perspective, the index is trading well above its 21-period Simple Moving Average (SMA), reinforcing a bullish outlook with the SMA acting as dynamic support. The Relative Strength Index (RSI) sits at 65.62, suggesting the market is in a strong but not overbought condition, leaving room for continued upside. Key support is established near the 25,200 level. Maintaining this level is essential for sustaining the current uptrend. The breakdown below could trigger a pullback toward lower support zones, with the 24,900 and 24,500 levels standing out on the weekly chart.