Canadian Stocks Tick Higher

index Update:

Canadian equities edged higher on Monday as investors weighed U.S. President Donald Trump’s comments regarding U.S.-Iran peace negotiations alongside reports suggesting Iran is preparing for an extended conflict with Israel.

After opening higher than Friday's session, today the benchmark S&P/TSX Composite  Index gained momentum early in the session but gave ground later. The index still managed to trade positive throughout the session before settling at 34,478.52, up by 65.07 points (or 0.19%).

Macro Update:

The Bank of Canada is expected to announce its interest rates on June 10 after its Monetary Policy meeting. In its April month's meeting, the Central Bank held the policy rate at 2.25%.

Last month, the Gross Domestic Product numbers revealed by Statistics Canada indicated that the country is in a "technical Recession", meeting the definition of two quarterly contractions in a row.

On Friday, the national Unemployment rate fell to 6.60% for the month of May, down from 6.90% in April.

Employment in Canada rose by 88,000 in May, a 0.40% increase from April, well above market expectations for a gain of 10,000.

Economists currently expect the BoC to hold its benchmark Interest Rate steady for the fifth straight time.

Top Movers:

Among the individual stocks, Birchcliff Energy Ltd (6.97%), Headwater Exploration Inc (4.25%), Tamarack Valley Energy Ltd (4.06%), Tecsys Inc (4.78%), and Celestica Inc (3.80%) were the prominent gainers.

Our Stance:

The key support is positioned near the 34,300 level, and a sustained break below this area could trigger a period of consolidation and potentially expose the 34,000 region. On the upside, a decisive move above the 34,600 resistance zone would strengthen bullish sentiment and may pave the way for a test of the 34,800 level in the near term.

Commodity Update:

The U.S. dollar remained slightly weaker as investors assessed easing tensions between Iran and Israel after both sides paused hostilities following diplomatic efforts led by U.S. President Donald Trump. The softer dollar provided some support to commodity markets, although price action remained mixed. Gold slipped 0.08% to USD 4,359.80 per ounce, while silver declined 1.21% to USD 67.75 and copper eased 0.22% to USD 13,585.30 per tonne. Brent Crude fell 0.68% to USD 93.62 per barrel as concerns over immediate Supply disruptions in the Middle East moderated.

Technical Update:

The S&P/TSX Composite Index advanced 65.29 points, or 0.19%, on Friday to close at 34,478.74, extending its recent positive momentum. Technically, the index remains above its 21-day Simple Moving Average (SMA), which continues to act as an important dynamic support level and reinforces the broader bullish market structure. Momentum indicators also remain constructive, with the 14-day Relative Strength Index (RSI) holding around 51.63, indicating steady buying interest while leaving scope for additional gains before overbought conditions develop. Key support is positioned near the 34,300 level, and a sustained break below this area could trigger a period of consolidation and potentially expose the 34,000 region. On the upside, a decisive move above the 34,600 resistance zone would strengthen bullish sentiment and may pave the way for a test of the 34,800 level in the near term.