Canadian stocks moved sharply higher on Thursday

Image Source : Krish Capital Pty Ltd

Index Update:  After opening well above yesterday's close, the benchmark S&P/TSX Composite Index moved further into positive territory and reached an intra-day high of 27,422.42 before finally settling at 27,386.93, up by 233.96 (or 0.86%). This is a fresh record for the index.

Macro Update:  Yesterday, PM Carney assured he plans to crack down on cheap, foreign steel entering Canada by the end of the month as the domestic industry is under duress due to Trump's tariff.  On the data front, the Canadian Federation of Independent Business Barometer long-term index rose 3.4 points to 50.9. The yield on the two-year bond eased to 2.81% today, marking a 0% decrease from the previous session.  In the US, jobs data revealed a positive trend, indicating a strong labor market. This has drawn up expectations for an interest rate cut by the US Federal Reserve, anytime sooner.

Top Movers:  Shopify Inc (6.15%), Sylogist Ltd (4.43%), Coveo Solutions Inc (4.39%), and Gildan Activewear Inc (5.65%) were the prominent gainers.

Our Stance:  From a technical perspective, the index is currently testing a key support level of around 27,100. Holding above this threshold is essential to preserve the current bullish trend. A breakdown below could lead to a pullback toward the next support zones near 26,800 and 26,600. Sustained movement above these levels will be crucial for maintaining upward momentum in the sessions ahead.

Commodity Update:  The dollar was poised for a second consecutive weekly gain, supported by strong U.S. economic data, suggesting the Federal Reserve may delay further rate cuts. Gold dipped 0.05% to $3343.60, while silver rose 0.62% to $38.54 and copper advanced 0.51% to $9,723.65. Brent crude inched up 0.04% to $69.48 amid concerns over potential Iraqi oil supply disruptions and uncertainty surrounding U.S. tariff policy, which is impacting demand.

Technical Update: 

On Thursday, the S&P/TSX Composite Index advanced by 233.96 points, closing at 27,386.93, a gain of 0.86%. The upward move reflects continued investor confidence, supported by strong trading activity, particularly in the technology sector, which outperformed with a 2.98% surge. From a technical perspective, the index remains comfortably above its 21-period Simple Moving Average (SMA), reinforcing a bullish short-term outlook. The Relative Strength Index (RSI) stands at 71.36, indicating strong momentum while overbought conditions. The index is currently testing a key support level of around 27,100. Holding above this threshold is essential to preserve the current bullish trend. A breakdown below could lead to a pullback toward the next support zones near 26,800 and 26,600. Sustained movement above these levels will be crucial for maintaining upward momentum in the sessions ahead.