S&P/TSX Composite Index would open on a softer note

The S&P/TSX Composite Index is expected to open on a softer note, despite sector-led gains in the previous session, particularly in basic materials and technology, which offered only limited support to the broader market.

From a technical perspective, the index remains below a key rising trendline resistance near 33,900, signalling continued fragility in the near-term structure. As long as this barrier holds, the overall bias is likely to remain cautious, with potential for further consolidation or corrective movement. On the downside, immediate support is seen around 33,300, and a sustained break below this level could weaken sentiment and reinforce a softer short-term outlook.

Global Macro Backdrop

Global markets are starting the session with a mixed and slightly defensive tone:

• U.S. equities closed modestly lower in the prior session as investors reacted to stronger-than-expected services data, reinforcing concerns that inflation pressures may remain sticky.
• Federal Reserve commentary continues to emphasize a restrictive stance, with policymakers indicating that rate cuts remain contingent on sustained inflation improvement.
• European markets are mostly flat, with gains in defensive sectors offset by weakness in cyclicals and industrial exporters.
• Asian equities are mixed, as optimism around Chinese policy support is balanced against uneven trade and manufacturing data.

Global bond yields remain elevated, keeping pressure on growth-sensitive equities while supporting demand for defensive assets.

Macro News Impacting the TSX

The TSX Composite is expected to open in a narrow range as investors wait for clearer macro direction:

• Markets are focused on upcoming Canadian inflation and labor market indicators, which will shape expectations for Bank of Canada policy in the coming months.
• Early April trading continues to show reduced volatility as quarter-end repositioning effects fully fade.
• Commodity-linked sectors remain the dominant influence on index performance due to Canada’s resource-heavy market structure.

Commodity view — what to watch

• Crude oil: WTI crude futures jumped more than 3% toward $98 per barrel on Thursday, recovering part of the prior session’s losses as renewed Israeli strikes on Lebanon raised doubts about the durability of a fragile Middle East ceasefire, while the Strait of Hormuz remains largely obstructed.
• Gold: Gold steadied near $4,700 per ounce on Thursday following sharp swings in the previous session, as investors assessed a fragile ceasefire in the Middle East amid sporadic fighting and lingering uncertainty over the reopening of the Strait of Hormuz.
• Silver: Silver slipped to around $73.5 per ounce on Thursday following sharp swings in the previous session, as investors weighed a fragile Middle East ceasefire amid sporadic clashes and ongoing uncertainty over the reopening of the Strait of Hormuz.
• Copper: Copper futures dropped 1% to around $5.7 per pound on Thursday, giving back gains from the previous session as a fragile US-Iran ceasefire weighed on risk sentiment. 

Sector highlights

• Energy: Expected to trade high to slightly lower on softer oil tone.
• Materials: Mixed, with gold strength offset by weaker base metals.
• Financials: Likely range-bound ahead of inflation and growth data releases.
• Technology & Industrials: Expected to track global risk sentiment with limited catalysts. 

Forex watch

• The Canadian dollar (CAD) is trading slightly weaker against the U.S. dollar, reflecting firm U.S. economic data and steady global bond yields.
• A softer CAD may provide modest support to Canadian exporters, particularly in energy and materials sectors.

Bottom line:

The TSX Composite is expected to open with a cautious, range-bound tone as investors await stronger macro signals to guide positioning. Gold continues to provide a key stabilizing force, while energy and base metals remain sensitive to shifting global demand expectations.

Overall sentiment remains balanced, with traders prioritizing macro data releases and central bank guidance as the primary catalysts for near-term direction in Canadian equities.