The TSX Index is expected to open on a higher note

The S&P/TSX Composite Index is expected to open on a positive note, supported by strength in the healthcare and technology sectors during the previous trading session.

From a technical perspective, the broader outlook remains constructive, with the index continuing to trade comfortably above its 21-day Simple Moving Average (SMA), a key indicator that reinforces the prevailing bullish trend and suggests buyers remain in control of the overall market direction. Momentum continues to favour the upside, with price action holding above important support levels and maintaining a positive medium-term bias. The index is now approaching a key resistance zone near 34,850, which represents an important test of bullish momentum. A decisive breakout above this level could enhance positive sentiment, attract fresh buying interest, and potentially pave the way for a move toward the psychologically significant 35,100 level. However, failure to overcome this resistance may result in near-term consolidation before the next directional move emerges.

Global Macro Backdrop

Global markets are trading with a moderately positive tone as investors continue to assess the outlook for growth and interest rates.

• U.S. equities closed mixed on Wednesday as investors rotated between growth and defensive sectors while evaluating the timing of potential Federal Reserve rate cuts.
• Recent economic data suggest the U.S. economy remains resilient, although signs of moderating inflation have strengthened expectations that monetary policy could gradually become less restrictive later in the year.
• European markets are trading slightly higher in early action, supported by improving manufacturing sentiment and easing concerns surrounding energy costs.
• Asian markets finished mostly positive overnight, led by gains in technology and industrial shares as investors responded to supportive economic measures and signs of stabilizing regional growth.

Global bond yields remain relatively contained, helping support equity valuations and broader risk appetite.

Canadian Market Focus

The TSX enters Thursday's session with commodity markets once again acting as a key source of support.

• Investors continue to monitor the outlook for the Bank of Canada, with inflation trends and labor-market conditions remaining central to policy expectations.
• Canada's financial sector remains a stabilizing force for the index, while energy and materials continue to drive much of the market's performance.
• Institutional investors remain focused on sectors tied to global infrastructure spending, electrification, and energy security themes.
• Market participants are also looking ahead to upcoming economic releases that could influence expectations for growth during the second half of 2026.

The combination of stable domestic fundamentals and firm commodity prices is helping underpin sentiment toward Canadian equities. 

Commodity view — what will move the TSX

• CrudeCrude oil fell below $70 a barrel on Thursday, extending losses for a fourth consecutive session and nearly wiping out all the gains made since the outbreak of the Middle East conflict, as progress in US-Iran peace efforts improved the supply outlook.
• Gold: Gold weakened below $4,000 an ounce on Thursday, sliding toward its lowest levels in almost eight months as a stronger dollar and growing expectations of Federal Reserve rate hikes continued to weigh on prices.
• Silver: Silver dropped below $57 an ounce on Thursday, hitting its lowest levels since November last year as a stronger dollar and growing expectations of Federal Reserve rate hikes continued to weigh on prices.
• Copper: Copper futures hovered around $6 per pound on Thursday, remaining near their lowest levels in seven weeks as a stronger US dollar and expectations of Federal Reserve interest rate hikes continued to weigh on sentiment.

Forex Watch

The Canadian dollar (CAD) is trading relatively stable against the U.S. dollar.

• Strength in commodity markets continues to support the currency.
• Foreign-exchange markets remain focused on the divergence, if any, between Bank of Canada and Federal Reserve policy paths.
• Stable currency conditions are helping reduce volatility for export-oriented sectors.

What to watch today

Investors will be closely watching:

• Crude oil and natural gas price movements
• Gold and copper market performance
• Federal Reserve and Bank of Canada policy expectations
• Global bond yield trends
• Economic growth indicators from North America and China
• Geopolitical developments affecting commodity markets

Market Outlook

The TSX Composite Index is expected to open with a modestly positive bias as commodity strength, stable bond yields, and improving global risk sentiment provide support. Energy and materials are likely to remain the primary leadership groups, while financials continue to offer stability to the broader market.

While market conditions have improved, investors remain highly sensitive to inflation developments and central-bank signals. Any significant shifts in commodity prices or interest-rate expectations could quickly influence sector leadership and overall market direction.

Final Takeaway

The TSX remains well-positioned to benefit from strength in commodities and infrastructure-related themes, but investors should continue monitoring inflation data, central-bank commentary, and geopolitical developments for clues about the market's next major move.