Canadian stocks rose incrementally on Monday

Image Source : Krish Capital Pty Ltd

Index Update: After opening much higher than the previous week's close, the benchmark S&P/TSX Composite Index fell early in the session but managed to climb again and trade positively to finally close at 30,531.88, up by 60.20 points (or 0.20%).

Macro Update: In the U.S., the government shutdown entered its sixth day today. Despite the absence of official macroeconomic numbers to rely upon, markets are pricing in a 94.6% chance of 25-basis-point rate cut by the U.S. Federal Reserve at its upcoming October 28-29 meeting. Canadian Prime Minister Mark Carney is visiting Washington tomorrow to meet U.S. President Donald Trump on a "working visit”. Pressure is building for Carney to negotiate some tariff relief as none of the conciliatory efforts by Canada to have smooth bilateral relations with the U.S. are showing positive results as Trump is showing no sign of flexibility. Traders are focused now on the job numbers to be released in Canada later this week which could hint on the likelihood of further rate cuts by the Canadian central bank.

Top Movers: Among the individual stocks, Baytex Energy Corp (4.55%), International Petroleum Corp (3.44%), Orla Mining Ltd (12.44%), G Mining Ventures Corp (8.42%), Perpetua Resources Corp (7.91%), and Brookfield Renewable Partners LP (3.10%) were the prominent gainers.

Our Stance: The index is currently consolidating near a key support area around 30,300. Sustaining this level will be crucial for maintaining market confidence and preserving the broader uptrend. However, a decisive break below this support could signal bullish exhaustion, potentially triggering a pullback toward 30,100 and 29,900.

Commodity Update: The yen fell to a two-month low against the dollar as the focus in Japan shifted to the potential cabinet lineup under fiscal dove Sanae Takaichi following her party leadership win. Gold rose 0.31% to $3,988.00, while silver slipped 0.12% to $48.38 and copper gained 0.38% to $10,686.80. Brent crude inched up 0.02% to $65.48 amid concerns about weak demand and expectations of limited OPEC+ output increases.

Technical Update:

On Monday, the S&P/TSX Composite Index advanced 60.20 points (0.20%) to close at 30,531.88. The gain was supported by strong trading volumes, reflecting sustained investor confidence and reinforcing the prevailing bullish momentum. Technically, the index remains in a firm uptrend, trading well above its 21-period Simple Moving Average (SMA), which continues to act as dynamic support. Momentum indicators also remain robust, with the RSI at 83.32, highlighting persistent buying pressure—though the indicator now hovers near the overbought zone, warranting short-term caution. The index is currently consolidating near a key support area around 30,300. Sustaining this level will be crucial for maintaining market confidence and preserving the broader uptrend. However, a decisive break below this support could signal bullish exhaustion, potentially triggering a pullback toward 30,100 and 29,900.