Canadian stocks pulled back on Monday

Index Update: After opening below the previous week's close, the benchmark S&P/TSX Composite Index, after remaining volatile until noon, turned lower to trade firmly negative and close at 30,076.21, down by 250.25 points (or 0.83%).

Macro Update: Data released by Statistics Canada today revealed that the headline inflation rate in Canada fell to 2.20% in October from 2.40% in the previous month, within the ballpark of Bank of Canada's expected baseline.

The trimmed-mean core inflation rate which is closely tracked by the BoC, inched down to 3.00% from 3.10% in September.

Annual core inflation inched up to 2.90% from 2.80% in September.

The Consumer Price Index (CPI) month-on-month in Canada increased 0.20% in October over the previous month and core inflation month-on-month increased 0.60%.

Top Movers: Among the individual stocks, Empire Company Ltd (1.82%), Maple Leaf Foods (1.45%), Loblaw CO (1.34%), and Quebecor Inc (2.17%) were the prominent gainers.

Our Stance: Momentum conditions also appear stable, with the 14-period RSI hovering near 48.85, reflecting steady, neutral-to-positive momentum. On the downside, immediate support lies near 29,900, a level bulls must defend to avoid deeper downside risk. A clear break below this support could open the door for a correction toward 29,700 and 29,500. Conversely, sustained closes above 29,900 would help maintain the prevailing bullish bias and keep the near-term outlook favorable.

Commodity Update: The yen weakened to a nine-month low in early Asian trade on Tuesday as fading expectations of a Fed rate cut next month boosted the dollar. Precious metals retreated, with gold down 1.32% to USD 4,020.40, silver slipping 2% to USD 49.68, and copper easing 0.43% to USD 10,733.10. Brent crude dipped 0.40% to USD 63.92 as supply concerns eased after Russian export loadings resumed.

Technical Update:

The S&P/TSX Composite Index fell 250.25 points (−0.83%) on Monday to settle at 30,076.21, as light profit-taking pressured sentiment. Despite the pullback, the broader technical structure remains constructive, with the index holding comfortably above its 50-period Simple Moving Average (SMA) a key dynamic support that continues to underpin the short-term uptrend and signal buyer control. Momentum conditions also appear stable, with the 14-period RSI hovering near 48.85, reflecting steady, neutral-to-positive momentum. On the downside, immediate support lies near 29,900, a level bulls must defend to avoid deeper downside risk. A clear break below this support could open the door for a correction toward 29,700 and 29,500. Conversely, sustained closes above 29,900 would help maintain the prevailing bullish bias and keep the near-term outlook favorable.