Canadian Index closed at a higher note on Monday

Index Update:  The benchmark S&P/TSX Composite Index climbed well off its early lows and into positive territory, ending the day up 201.28 points or 0.6 percent at a new record closing high of 34,541.27.

Macro Update: Iran retaliated by launching waves of drones and missiles on countries across the Middle East, including Kuwait, the United Arab Emirates, Bahrain, Saudi Arabia, Oman, and Qatar. The conflict in the region escalated further today after Israel launched airstrikes on Hezbollah targets in Beirut and other parts of Lebanon following projectile fire from Lebanese territory into northern Israel. In U.S. economic news, the Institute for Supply Management released a report showing a slight slowdown in the pace of growth in U.S. manufacturing activity in the month of February. The ISM said its manufacturing PMI edged down to 52.4 in February after surging to 52.6 in January, but a reading above 50 still indicates growth. Economists had expected the index to dip to 51.8. Additionally, the manufacturing sector of Canada showed resilience as the February PMI hit a 13-month high of 51.

Top Movers: Energy heavyweights like Suncor and Cenovus gained over 2.5% as crude prices remained elevated despite coming off session highs. Further support came from a late rebound in the financial sector, with RBC and TD Bank erasing early losses to finish in positive territory.

Our Stance: Price action is currently consolidating around the important 34,500 support zone. Maintaining levels above this threshold will be critical to preserve bullish sentiment. However, a decisive break below 34,500 could weaken near-term momentum and trigger a corrective pullback toward the 34,300 and 34,100 support areas.

Commodity Update: Gold extended its advance in Asian trade, marking a fourth consecutive gain as escalating Middle East tensions supported safe-haven demand, though a firmer U.S. dollar limited sharper upside. Gold climbed 1.32% to USD 5,382.40, silver rose 1.68% to USD 90.35, and copper added 1.01% to USD 13,242.00. Brent crude advanced 2.00% to USD 79.28, following a prior 7% surge amid Strait of Hormuz supply concerns.

Technical Update:

The S&P/TSX Composite Index climbed 201.28 points, or 0.59%, to close at 34,541.27 on Monday, supported by strong trading volumes that underscored solid investor participation. Technically, the index continues to display a constructive structure, holding comfortably above its 50-period Simple Moving Average (SMA), which remains a key dynamic support within the prevailing uptrend. The 14-period RSI stands at 67.58, signaling sustained buying momentum while approaching overbought territory. Price action is currently consolidating around the important 34,500 support zone. Maintaining levels above this threshold will be critical to preserve bullish sentiment. However, a decisive break below 34,500 could weaken near-term momentum and trigger a corrective pullback toward the 34,300 and 34,100 support areas.