Canadian stocks advanced on Wednesday

Index Update:  After opening higher than yesterday's close, the benchmark S&P/TSX Composite Index remained volatile through the session before settling just shy of yesterday's record peak at 32,870.36, down by 4.34 points (or 0.01%).

Macro Update:  With no significant data releases for today, it was an unremarkable day for Canada. In the U.S., the (delayed) data from the Bureau of Labor Statistics revealed that the Producer Price Index rose by 0.2% in November. However, November's retail sales numbers exceeded expectations, climbing by 0.6%. U.S. Federal Reserve Chair Jerome Powell is set to undergo a criminal investigation from the U.S. Department of Justice in connection with the renovation project to the Fed's building, last year. With the available data so far revealing no dramatic job losses, traders have pruned their expectations for rate cuts in both Canada and the U.S.

Top Movers:  Among the individual stocks, Cenovus Energy Inc (4.54%), Canadian Natural Resources Ltd (4.44%), Ces Energy Solutions Corp (3.47%), Taseko Mines Ltd (12.07%), Nutrien Ltd (7.99%), and Energy Fuels Inc (7.50%) were the prominent gainers.

Our Stance:  While the RSI is elevated, it continues to signal strong momentum rather than an immediate reversal, suggesting the market may consolidate before attempting another leg higher. On the downside, immediate support is located near the 32,800 level. A decisive break below this zone could trigger a deeper corrective move toward the 32,600 area. 

Commodity Update:   The yen held onto overnight gains but remained pinned near 18-month lows, as caution over possible intervention persisted amid Japan’s election outlook and expectations of added fiscal stimulus. In commodities, gold slipped 0.85% to USD 4,596.70, silver fell 3.75% to USD 88.10, and copper eased 1.17% to USD 13,069.00. Brent crude dropped 2.40% to USD 64.94, retreating from multi-month highs after U.S. President Donald Trump eased concerns over potential U.S. military action against Iran.

 Technical Update:

On Wednesday, the S&P/TSX Composite Index advanced 46.11 points (+0.14%) to close at 32,916.47, supported by healthy trading volumes that reflect strong investor confidence and sustained bullish momentum across the broader market. From a technical perspective, the index continues to trade comfortably above its 21-period Simple Moving Average (SMA), reinforcing the strength of the prevailing short-term uptrend and highlighting continued buying interest on minor pullbacks. The 14-period Relative Strength Index (RSI) stands at 72.00, indicating robust upside momentum and strong demand, while edging closer to overbought territory, which may warrant some near-term caution. Price action is currently consolidating near the key 32,900 support zone, a level that is critical for maintaining positive market sentiment and trend stability. As long as the index holds above this support, the bullish bias remains intact. However, a decisive break below 32,900 could weaken momentum and open the door to a corrective move toward the 32,700–32,600 range.