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TSX Continues to Climb Higher

By: Team Kalkine | Jan 27, 2025 | Read Time : 10 Mins
TSX Continues to Climb Higher

Image Source : Krish Capital Pty Ltd

Index Update: Despite moving in a tight band in lackluster trade, the Canadian market closed higher on Friday, extending gains to a ninth straight day, the longest winning run in over three years. The benchmark S&P/TSX Composite Index closed up 34.41 points or 0.14% at 25,468.49, the highest finish in six weeks. The index gained about 1.6% in the week.

Macro Update: In economic news, new home prices in Canada decreased by 0.1% over a month in December 2024, following a 0.1% increase in November, data from Statistics Canada showed. House Price Index decreased to 0.1% (y-o-y) in December from 0.2% in November of 2024.

Manufacturing sales in Canada rose by 0.6% from the previous month in December of 2024, expanding on the 0.8% rise in the previous month, according to a preliminary estimate.

Top Movers: Pan American Silver Corp (PAAS.TO), Hut 8 Corp (HUT.TO), Magna International (MG.TO), CCL Industries (CCL.A.TO), Aritzia Inc (ATZ.TO), Rogers Communications (RCI.A.TO), Dayforce (DAY.TO), Wheaton Precious Metals (WPM.TO) and Constellation Software (CSU.TO) climbed 1.5 to 2.5%.

Our Stance: This upward movement, coupled with solid trading volumes, suggests continued investor confidence. Technically, the index remains in a favorable position, staying above its 21-period Simple Moving Average (SMA), signaling that the bullish trend is still intact. The Relative Strength Index (RSI) at 63.36 indicates room for further growth without entering overbought territory. The index is currently testing key support at 25,000. If it holds above this level, the path is clear for continued growth.

Commodity Update: The dollar strengthened on Monday as traders assessed the potential impact of U.S. President Donald Trump's tariff plans, with the Federal Reserve expected to keep interest rates steady this week. Last week, the dollar saw its weakest performance since November 2023, as concerns about tariffs eased, but those fears resurfaced after Trump announced plans to impose tariffs on Colombia. In commodities, gold fell 0.48% to $2,793.40, silver dropped 1.33% to $30.76, and copper declined 0.35% to $9,249.00. Meanwhile, Brent crude dropped 1.11% to $77.63 a barrel after Trump urged OPEC to cut prices amid measures to boost U.S. oil production.

 

Technical Update: On Friday, the S&P/TSX Composite Index posted a modest gain, rising 34.41 points to close at 25,468.49, reflecting a 0.14% increase. This upward movement, coupled with solid trading volumes, suggests continued investor confidence. The utilities sector led the charge with a 1.06% gain, indicating positive sentiment for both the sector and the broader market. Technically, the index remains in a favorable position, staying above its 21-period Simple Moving Average (SMA), signaling that the bullish trend is still intact. The Relative Strength Index (RSI) at 63.36 indicates room for further growth without entering overbought territory. The index is currently testing key support at 25,000. If it holds above this level, the path is clear for continued growth. However, a break below this level could lead to retracement risks, with support zones to watch between 24,700 and 24,200. The ability of the index to stay above these levels will likely dictate near-term market sentiment and prospects for further gains.


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