TSX Ended on a Negative Note

Image Source : Krish Capital Pty Ltd

Index Update: The S&P/TSX Composite Index closed in red on Monday at 24,008.86 with a broad-based decline of negative 183.95 points or (-0.76%) from the last trading day closing level, mainly driven by tariff uncertainties, pre-election polls showing a six-point lead over Conservatives, renewed Fed‑independence concerns from President Trump’s criticism.

Macro Update: Macroeconomic landscape is facing strain from escalating trade tensions, with OECD forecasts stating slowdown in Canada’s GDP growth to 0.7% in 2025 due to U.S. imposed tariffs and rising inflation pressures beyond the BoC’s comfort zone.

The growing tension between U.S. – China and U.S. – Iran have dim growth prospects with a upside pressure on inflation expectations. The April 28, 2025, vote adds a layer of policy uncertainty, especially around trade measures, fiscal transfers and stimulus measures.

Key event to watch out is the upcoming Canadian Federal Election scheduled for April 28, 2025, Bank of Canada Rate Decision on June 4, 2025, and U.S. Federal Reserve FOMC Meeting on May 6 – 7, 2025.

Top Movers and losers: Mining and Gold sector contributed to the uptick with the energy sector experiencing a fall mainly due to a sharp drop in oil prices. Stocks which have shown a decent runup were – Novagold Resources Inc. (+4.61%), Torex Gold Resources Inc. (+2.90%), G Mining Ventures Corp. (+2.58%), and Orla Mining Ltd. (+2.11%). Stocks that traded in the negative zone were – Energy Fuels Inc. (-9.52%), Bausch Health Companies (-7.92%), Denison Mines Corp. (-6.88%), and CES Energy Solutions(-5.94%).

Our Stance: The index remains below its 21-period Simple Moving Average (SMA), signaling ongoing downward momentum and persistent selling pressure. From a technical standpoint, Immediate support is seen near the 23,700 mark a key horizontal level that could act as a short-term floor, allowing for consolidation or a relief rally. A decisive break below this level, however, could open the door to further declines, with additional support levels at 23,400 and 23,000.

Commodity Update: The dollar hovered near a three-year low Tuesday after President Trump intensified criticism of Fed Chair Jerome Powell, calling him a "major loser" and urging immediate rate cuts. Investor confidence in the U.S. economy wavered. Gold surged 1.69% to $3,483.25, silver edged up 0.18% to $32.57, and copper rose 0.51%. Brent crude gained 0.80% to $66.77 as traders covered short positions despite ongoing economic concerns.

Technical Update: On Monday, the S&P/TSX Composite Index fell by 183.95 points to close at 24,008.86, marking a 0.76% decline. While the drop was modest, it could signal the end of the recent rally and a potential return to the broader correction trend. The index is nearing a long-term trendline that began in November 2023, along with the 200-day Simple Moving Average from below—both of which suggest that downward pressure may intensify in the near term. Additionally, the Relative Strength Index (RSI) has pulled back after nearing the midpoint, hinting at a possible shift in momentum. From a technical standpoint, the outlook remains cautious. Immediate support lies around the 24,000 level, which might act as a short-term base. A definitive break below this point could trigger further downside, with additional support levels near 23,000 and 22,228.