Canadian Stocks Slide Amid Profit Taking

Index Update:  After opening below yesterday's close, the benchmark S&P/TSX Composite Index traded firmly negative throughout the session before settling at 32,135.49, down by 271.53 points (or 0.84%).

Macro Update:  Yesterday, Trump announced that Venezuela would transfer 30 million to 50 million barrels of "extra-heavy crude" to the U.S. and that the U.S. can sell up to $3 billion worth of Venezuelan crude presently in tankers and reserve facilities. Reportedly, Venezuela will continue to supply even beyond the initial 50 million barrels.  A boost in Venezuelan oil exports could immensely hurt Canadian companies selling similar oil to U.S. refiners. Of note, in 2025 alone, Canada exported around 90% of its crude to the U.S. The Prime Minister's Office has confirmed that Carney will visit China from January 13 through 17 to discuss bilateral cooperation in trade, energy, agriculture, and international security. Relations between both countries have been strained over several disputes and Carney's visit could reset the association. The Employment Index climbed to 53 from 48, indicating improved labor conditions.

Top Movers:  Among the individual stocks, Bausch Health Companies Inc (3.60%), Curaleaf Holdings Inc (1.78%), H&R Real Estate Inv Trust (2.37%), Primaris REIT (2.29%), and Northwest Healthcare Prop REIT (2.26%) were the prominent gainers.

Our Stance:  Momentum indicators remain supportive, with the Relative Strength Index (RSI) holding at 61.87, indicating sustained strength within a neutral-to-positive range. On the downside, immediate support is seen near the 32,100 level. A decisive break below this zone could trigger further corrective pressure toward 31,900, with the next major support positioned around 31,800.

Commodity Update:  The U.S. dollar traded steadily on Thursday as investors assessed fresh economic data pointing to a fragile U.S. growth outlook ahead of Friday’s key jobs report, while elevated geopolitical tensions capped risk appetite. In commodities, gold slipped 0.25% to USD 4,452.20, silver gained 0.22% to USD 77.77, and copper eased 0.02% to USD 12,889.00. Brent crude rose 0.60% to USD 60.34, rebounding on a larger-than-expected U.S. crude inventory draw and ongoing focus on Venezuela developments.

Technical Update:

The S&P/TSX Composite Index fell 271.53 points (−0.84%) on Wednesday to close at 32,135.49, as short-term profit-taking cooled the recent upside momentum. Despite the pullback, the broader technical structure remains constructive. The index continues to trade comfortably above its 21-period Simple Moving Average (SMA), which serves as a key short-term trend support and reinforces the prevailing bullish bias. Momentum indicators remain supportive, with the Relative Strength Index (RSI) holding at 61.87, indicating sustained strength within a neutral-to-positive range. On the downside, immediate support is seen near the 32,100 level. A decisive break below this zone could trigger further corrective pressure toward 31,900, with the next major support positioned around 31,800.