Canadian stocks move lower on Tuesday

Index Update:  After opening below yesterday's close, the benchmark S&P/TSX Composite Index reached ground early in the session and only regained momentum later post noon to finally close at 30,036.46, down by 39.75 points (or 0.13%).

Macro Update:  Canada-U.S. high-level talks in an effort to strike a favorable trade deal suffered a jolt when Trump halted the negotiations apparently angered over an anti-tariff advertisement created in Canada mocking U.S. tariffs. Canada's Mortgage and Housing Corporation today revealed that housing starts in Canada sank by 17% from the previous year to a seasonally adjusted rate of 232,765 units in October, marking the lowest rate of starts in seven months. In Canada, yesterday, data released by Statistics Canada revealed that the headline inflation rate in Canada fell to 2.20% in October from 2.40% in September. The trimmed-mean core inflation rate (closely tracked by the central bank), inched down to 3.00% from 3.10% in September. The CPI-median slipped to 2.9%.

Top Movers:  Among the individual stocks, Birchcliff Energy Ltd (5.37%), Peyto Exploration and Development Corp (5.26%), Ces Energy Solutions Corp (4.66%), and Chartwell Retirement Residences (2.91%) were the prominent gainers.

Our Stance:  Momentum readings also remain steady, with the 14-period RSI at 48.22, signaling neutral-to-positive momentum. On the downside, immediate support is located near 29,900, a level bulls need to defend to prevent deeper weakness. A decisive break below this zone could pave the way for a correction toward 29,700 and 29,500. Conversely, if the index can maintain sustained closes above 29,900, the prevailing bullish bias is likely to remain intact, keeping the near-term outlook favorable.

Commodity Update:  The yen steadied and the U.S. dollar held firm in early Asian trade on Wednesday as investors shifted to safe havens after a global stock selloff. Gold rose 0.26% to USD 4,077.20 per ounce, while silver gained 0.81% to USD 50.96 and copper added 0.57% to USD 10,758.50. Brent crude slipped 0.40% to USD 64.61 amid rising U.S. inventories and anticipation over upcoming U.S. sanctions on Russian oil firms.

Technical Update: 

The S&P/TSX Composite Index slipped 39.75 points (−0.13%) on Tuesday, closing at 30,036.46, as light profit-taking weighed on sentiment. Despite the modest pullback, the broader technical outlook remains constructive, with the index holding well above its 50-period Simple Moving Average (SMA) a key dynamic support that continues to reinforce the short-term uptrend and reflect underlying buyer control. Momentum readings also remain steady, with the 14-period RSI at 48.22, signaling neutral-to-positive momentum. On the downside, immediate support is located near 29,900, a level bulls need to defend to prevent deeper weakness. A decisive break below this zone could pave the way for a correction toward 29,700 and 29,500. Conversely, if the index can maintain sustained closes above 29,900, the prevailing bullish bias is likely to remain intact, keeping the near-term outlook favorable.