Canadian stocks gained traction on Tuesday

Index Update:  Extending yesterday's gains, Canadian stocks climbed on Tuesday after U.S. President Donald Trump's comments on the Middle East conflict yesterday propelled gold prices. Gains in metal-linked stocks pushed the market higher. The benchmark S&P/TSX Composite Index gave ground initially but soon regained momentum to trade positively through the rest of the session before settling at 33,270.65, up by 81.33 points (or 0.25%).

Macro Update:  Inflation concerns left investors to wind up their expectations of any near-term interest rate cuts, both by the U.S. Federal Reserve as well as major central banks of other nations, leading to gains in U.S. dollar value. In a significant development yesterday, in an interview with reporter Weijia Jiang of CBS News, Trump commented that the war with Iran would end "very soon." Trump added that Iran now has no navy, communications, or air force and that their missiles are scattering and drones were being blown up all over. The Canadian index carried the momentum after gold prices gained more than 2.50% today leading to an uptrend in metal-linked stocks that pushed the index higher.

Top Movers:  Among the individual stocks, G Mining Ventures Corp (7.98%), Silvercorp Metals Inc (6.70%), Denison Mines Corp (5.78%), Eldorado Gold Corporation (4.79%), and Definity Financial Corporation (2.31%) were the prominent gainers.

Our Stance: Momentum indicators reinforce this neutral stance, with the 14-period Relative Strength Index (RSI) hovering near its midpoint. At present, the benchmark is confined between key technical boundaries, resistance at the prior peak of 34,544.46 and support at the previous trough of 31,726.75, a range that could encourage a period of consolidation in the near term.

Commodity Update:  The U.S. dollar remained steady on Wednesday as investors stayed cautious, waiting for clearer developments in the ongoing U.S.–Israel conflict with Iran. Uncertainty around a potential resolution kept overall market sentiment fragile. In commodities, gold slipped 0.40% to USD 5,221.40, silver declined 0.88% to USD 88.78, and copper eased 0.31% to USD 13,129. Meanwhile, Brent crude edged up 0.13% to USD 87.91 after reports that the IEA may release record oil reserves to ease supply concerns.

Technical Update:

The S&P/TSX Composite Index extended its rebound in the latest session, gaining 81.33 points, or 0.25%, to finish at 33,270.65. The index remains positioned above its 50-period Simple Moving Average (SMA), signaling that the medium-term trend is still positive. However, it continues to trade below the 21-period SMA, which is currently functioning as a dynamic resistance level and suggests a more cautious short-term technical outlook. Momentum indicators reinforce this neutral stance, with the 14-period Relative Strength Index (RSI) hovering near its midpoint. At present, the benchmark is confined between key technical boundaries, resistance at the prior peak of 34,544.46 and support at the previous trough of 31,726.75, a range that could encourage a period of consolidation in the near term.