Canadian Stocks Soar Amid Rising Optimism

index Update:

Canadian stocks rallied again on Monday, extending last week’s three-session winning streak, as growing signs of a potential U.S.-Iran peace agreement boosted investor optimism.

After opening above previous week's close, today the benchmark S&P/TSX Composite Index initially gained momentum to hit a new intra-day record high of 34,846.50 and then gave ground but traded firmly positive throughout the rest of the session before settling at 34,830.89, up by 359.53 points (or 1.04%).

Macro Update:

On the economic front, there were no significant releases today except Statistics Canada's Wholesale Trade report which showed the month-on-month sales to have edged up 0.10% in April following a 1.90% increase in the previous month.

Elsewhere in the Middle East, despite a proclaimed ceasefire, Israel continued attacking Lebanon targeting Hezbollah militants.

Canadian investors are also focusing on the first round of formal negotiations between the U.S. and Mexico in Mexico City regarding the Canada-United States-Mexico Agreement which is up for renewal in a few weeks.

Top Movers:

Among the individual stocks, Hudbay Minerals Inc (8.94%), First Quantum Minerals Ltd (8.36%), Capstone Copper Corp (7.44%), Montage Gold Corp (6.98%), and Coveo Solutions Inc (7.88%) were the prominent gainers.

Our Stance:

The Immediate support is placed around the 34,700 level, and a sustained break below this zone may lead to short-term consolidation toward 34,400. On the upside, a decisive breakout above the 35,000 resistance area could strengthen bullish sentiment further and potentially open the door for a move toward the 35,200 level in the near term.

Commodity Update:  

The U.S. dollar remained under pressure on Tuesday as investors weighed hopes of a potential agreement to reopen the Strait of Hormuz and ease the three-month-long Iran conflict against fresh U.S. strikes on Iranian targets. Gold declined 0.74% to USD 4,570.90 per ounce, while silver dropped 1.77% to USD 77.01. Copper edged up 0.02% to USD 13,667.50 per tonne. Brent Crude oil advanced 1.10% to USD 97.32 per barrel as Middle East tensions continued to keep energy markets volatile.

Technical Update:

The S&P/TSX Composite Index gained 359.53 points, or 1.04%, on Friday to close at 34,830.89, reflecting renewed buying interest and improving overall market sentiment. Technically, the index continues to trade above its 50-day Simple Moving Average (SMA), which remains a key dynamic support level and reinforces the prevailing bullish trend structure. Momentum indicators also remain constructive, with the 14-day Relative Strength Index (RSI) near 64.31, signalling healthy bullish momentum while still leaving room for further upside before approaching overbought conditions. Immediate support is placed around the 34,700 level, and a sustained break below this zone may lead to short-term consolidation toward 34,400. On the upside, a decisive breakout above the 35,000-resistance area could strengthen bullish sentiment further and potentially open the door for a move toward the 35,200 level in the near term.