The Canadian market ended slightly down on Friday

Image Source : Krish Capital Pty Ltd

Index Update: After ending the previous session modestly lower, Canadian stocks saw some further downside during trading on Friday. The benchmark S&P/TSX Composite Index regained ground after an early slump but still closed down 91.75 points or 0.4 percent at 24,968.49.

Macro Update: Statistics Canada said core retail sales, which exclude gasoline stations and fuel vendors and motor vehicle and parts dealers, dipped by 0.2 percent in January.

Top Movers: Shopify Inc, Northland Power Inc, Tourmaline Oil Corp, Cenovus Energy Inc, ARC Resources gained 2.7 to 0.8%.

Our Stance: The index remains above its 21-period Simple Moving Average (SMA), supporting a bullish outlook. Currently, the index is testing a crucial support level around 24,700. Maintaining this level is essential to sustaining the upward trend, while a break below could lead to a pullback, with key support zones between 24,500 and 24,200. To continue its rally, the index must demonstrate resilience above these critical levels.

Commodity Update: The dollar dipped just below a three-week high against major currencies on Monday as traders awaited clarity on President Donald Trump’s upcoming tariff decisions. Greenback has struggled this year, with initial expectations of pro-growth policies shifting to concerns over Trump's aggressive trade stance, potentially sparking a recession. In commodities, gold rose 0.05% to $3,049.80, silver gained 0.59% to $33.67, and copper climbed 0.65% to $9,935.20. However, Brent crude slipped 0.40% to $71.88 as markets prepared for potential tariff announcements and kept an eye on ongoing Russia-Ukraine peace talks.

Technical Update: On Friday, the S&P/TSX Composite Index settled at 24,968.49, reflecting a slight decline of 0.37%. The basic materials sector led the downturn, slipping 1.04% and dampening overall market sentiment. Despite this, the index remains above its 21-period Simple Moving Average (SMA), reinforcing a bullish outlook. The Relative Strength Index (RSI) stands at 50.94, indicating market stability with room for potential gains. Currently, the index is testing a key support level near 24,700. Sustaining this level is essential for preserving upward momentum, while a break below could trigger a pullback, with notable support zones between 24,400 and 24,100. To sustain its rally, the index must demonstrate resilience above these crucial levels.