Canadian stocks pulled back on Tuesday

                                                           Source: Krish Capital Pty Ltd

Index Update: After opening a little above yesterday's close, the benchmark S&P/TSX Composite Index turned lower and conceding gains from the previous sessions finally closed at 30.351.72, down by 180.16 points (or 0.59%).

Macro Update: Data released by Statistics Canada today revealed that Canada's trade deficit widened to C$6.3 billion in August. Canada's exports fell 3.0% month-on-month to C$60.6 billion in August. Eight of the 11 product categories posted declines. Imports rose 0.9% month-over-month to C$66.91 billion in August, led by a 24.2% jump in imports of metal and non-metallic mineral products.

Canada's Ivey Purchasing Managers Index - released by Ivey Business School - showed that the index jumped to 59.8 in September from 50.1 in August.

Despite the unemployment rate hitting 7.1%, the highest in nine years, Canadian TSX index has been on a rally in recent days, hitting and breaking record high values consistently.

Top Movers: Among the individual stocks, Baytex Energy Corp (2.61%), Transalta Corp (2.25%), Rogers Communications Inc (2.42%), Curaleaf Holdings Inc (2.74%), and Loblaw CO (1.36%) were the prominent gainers.

Our Stance: The elevated reading underscores robust bullish momentum but also indicates overbought conditions, suggesting scope for short-term consolidation or corrective pullbacks. On the downside, immediate support is placed at 30,100, a key level for bulls to defend. A decisive break below this base could pave the way for deeper retracements toward 29,900 and 29,800.

Commodity Update: The U.S. dollar strengthened to a two-month high in early Asian trade Wednesday amid renewed concerns over a potential U.S. government shutdown, driving safe-haven demand. Gold rose 0.72% to $4,033.50, silver gained 1.47% to $48.21, while copper slipped 0.16% to $10,712.40. Brent crude advanced 0.70% to $65.91 as traders weighed mixed U.S. inventory data and an upcoming modest OPEC+ output hike in November.

Technical Update:

The S&P/TSX Composite Index closed Tuesday’s session with a decline of 180.16 points (−0.59%), settling at 30,351.72. The pullback reflected mild profit-taking, though the broader technical backdrop remains constructive. From a trend perspective, the index continues to trade comfortably above its 21-period Simple Moving Average (SMA), which is acting as dynamic support and reinforcing the prevailing short-term uptrend. Sustained closes above this level suggests that buyers remain in control despite near-term volatility. Momentum indicators also highlight underlying strength, with the Relative Strength Index (RSI) standing at 74.63. This elevated reading underscores robust bullish momentum but also indicates overbought conditions, suggesting scope for short-term consolidation or corrective pullbacks. On the downside, immediate support is placed at 30,100, a key level for bulls to defend. A decisive break below this base could pave the way for deeper retracements toward 29,900 and 29,800.