Canadian Stocks End 2025 on a Lower Note

Index Update:  After opening a little lower than yesterday's close, today the benchmark S&P/TSX Composite Index shed the gains made early in the session to trade negative through the rest of the day before settling at 31,712.76, down by 153.50 points (or 0.48%).

Macro Update:  However, concerns are rising as CUSMA is coming up for renewal in the coming year, because Trump has hinted that the U.S. would want to amend the deal to benefit U.S. manufacturing industries or even may walk out of the deal. In his customary New Year's Eve address to the nation, Prime Minister Mark Carney stated that Canada did face challenges in 2025 but the country is strongest when united. Despite heavy tariff pressures, the TSX composite index jumped nearly 30% in 2025, outshining global peers. In the U.S., the minutes of the U.S. Federal Reserve's December meeting revealed that, as widely expected, officials remain divided over future rate cuts. In Canada, the Bank of Canada held its benchmark interest rate at 2.25% in December as the inflation numbers were around the central bank's target range as well as due to decent employment data. During the announcement, repeating what he said in October, BoC Governor Tiff Macklem stated that the policy rate was at about the right level.

Top Movers:  Among the individual stocks, BCE Inc (1.36%), Telus Corp (1.23%), Northland Power Inc (1.42%), Superior Plus Corp (1.22%), and Canada Packers Inc (0.69%) were the prominent gainers.

Our Stance:  Momentum conditions remain firm, with the 14-period RSI holding near 58.17, reflecting neutral-to-positive momentum without any signs of overextension. On the downside, immediate support is located near the 31,700 level—a critical zone that bulls must defend to avoid deeper corrective pressure. A decisive break below this area could open the door for further downside toward 31,500, followed by 31,300.

Commodity Update:  The U.S. dollar began 2026 on a weak footing after underperforming most major currencies last year, while the yen steadied near 10-month lows as markets awaited key economic data to assess interest-rate trajectories. Gold rose 0.71% to USD 4,371.90, silver gained 2.22% to USD 72.165, and copper increased 0.51% to USD 12,528.75. Brent crude edged up 0.26% to USD 61.07, as investors balanced fresh geopolitical risks against expectations that OPEC+ will maintain its current supply policy.

Technical Update:

The S&P/TSX Composite Index slipped 153.50 points (−0.48%) on Wednesday to close at 31,712.76, as mild profit-taking weighed on market sentiment. Despite the modest pullback, the broader technical structure remains constructive. The index continues to trade comfortably above its 50-period Simple Moving Average (SMA), a key dynamic support that reinforces the prevailing short-term uptrend and signals sustained buyer control. Momentum conditions also remain firm, with the 14-period RSI holding near 58.17, reflecting neutral-to-positive momentum without any signs of overextension. On the downside, immediate support is located near the 31,700 level—a critical zone that bulls must defend to avoid deeper corrective pressure. A decisive break below this area could open the door for further downside toward 31,500, followed by 31,300.