Canadian Stocks Close Moderately Higher

Image Source : Krish Capital Pty Ltd

Index Update:  After ending yesterday's volatile session mostly higher, Canadian stocks saw further upside over the course of the trading day on Wednesday. The benchmark S&P/TSX Composite Index moved to the downside early in the session but showed a significant turnaround to end the day up 273.90 points or 1.1 percent at 25,307.18.

Macro Update: The yield on the Canadian 10-year government bond fell past 2.95%, nearing the two-year low of 2.83% seen in early March, as weak economic data and escalating trade tensions heightened expectations of further monetary easing.

Top Movers: The tech sector enjoyed a respite, with Shopify (+3.2%), Constellation Software (+3%), CGI (+1.3%), and Celestica (+4.3%) posting strong gains, while financial heavyweights such as RBC, TD Bank, Brookfield, BMO, and Scotiabank added around 1% each.

Our Stance: Currently, the index is testing a key support level of around 25,000. Holding above this threshold is crucial to sustaining upward momentum, while a drop below could trigger a pullback toward support zones between 24,800 and 24,500. Maintaining these levels will be vital for continued growth.

Commodity Update: The dollar weakened broadly on Thursday, and the euro gained strength after President Donald Trump announced aggressive tariffs, including a 10% baseline on all U.S. imports, effective April 9, targeting around 60 countries. This move raised concerns about a global trade war, potentially reducing demand for crude oil. In commodities, gold rose 0.05% to $3,167.55, silver fell 2.22% to $33.88, and copper decreased 1.33% to $9,565.50. Brent oil dropped 2.63% to $72.98 per barrel, reflecting fears of economic slowdown due to escalating trade tensions. The market reacted sharply to the unexpected trade policy shift.

Technical Update: On Wednesday, the S&P/TSX Composite Index climbed 273.90 points, closing at 25,307.18, marking a 1.09% increase. This rise reflects sustained investor confidence, particularly in the technology sector, which advanced by 2.50%. From a technical perspective, the index remains above its 21-period Simple Moving Average (SMA), reinforcing a bullish trend. The Relative Strength Index (RSI) sits at 56.03, indicating a healthy market with room for further gains. Currently, the index is testing a key support level of around 25,000. Holding above this threshold is crucial to sustaining upward momentum, while a drop below could trigger a pullback toward support zones between 24,800 and 24,500. Maintaining these levels will be vital for continued growth.