Canadian Stocks Advance As Gains In Mining Stocks Pushes Index Up

(RTTNews) - Canadian stocks edged higher on Thursday as gains in gold jacked up mining stocks which pushed the index higher while traders assessed the economic outlook and the Bank of Canada's decision yesterday to keep rates unchanged.

After opening just a little lower than yesterday's close, the benchmark S&P/TSX Composite Index soon gained momentum to trade firmly positive throughout the rest of the session before settling at 31,660.73, up by 169.88 points (or 0.54%). Notably, this is a new record high for the index.

Six of the 11 sectors posted gains today, with the materials sector leading the pack.

Yesterday, the U.S. Federal Reserve instituted a quarter-point rate cut, bringing rates down to the 3.50% to 3.75% range.

The Fed's projections hinted that one rate cut will take place next year although new data could change this. The bankers wish to see how the three rate cuts implemented this year work their way through the economy.

The rate cut pressured the U.S. dollar downwards. Front month Comex gold for December delivery climbed sharply by $89.10 (or 2.12%) to $4,285.50 per troy ounce.

Recent data indicated that the Canadian economy posted a 2.6% annualized jump in the third quarter, while the unemployment rate dropped 0.4% points to 6.5% in November.

Hence yesterday as expected, the Bank of Canada decided to hold its target for the overnight rate at 2.25%, with the Bank Rate at 2.50% and the Deposit Rate at 2.20%.

BoC stated that though "uncertainty remains elevated" it is prepared to respond if the economic outlook changes.

A substantial portion of Canadian exports to the U.S. escape the 35% tariffs by transiting through the Canada-United States-Mexico Agreement which is up for renewal in 2026.

U.S. President Donald Trump earlier indicated that the U.S. may consider withdrawing from the pact. Trump's comments increased concerns among the domestic exporters. Experts warned that as Trump has the calling cards, he could tilt the agreement in his favor, threatening to pull out if other two countries reject his suggestions.

Dominic LeBlanc, the minister in charge of Canada-U.S. trade, has now reassured that that is not the objective the Americans have in mind.

On Wednesday, Prime Minister Mark Carney noted that Canada finished its consultations on renewing the agreement on trade and added that the review process will gather force in the new year.

Data released by Statistics Canada today revealed that Canada's trade balance swung to a surplus of C$0.15 billion in September from a C$6.3 billion deficit in August, much higher than expectations for a C$4.5 billion deficit.

While exports rose 6.3% month-on-month to C$64.2 billion in September, imports of goods and services edged up 0.6% to $342.1 billion.

In the U.S., tech major Oracle reported lower-than-expected quarterly revenue and provided downbeat guidance yesterday after which Oracle's shares tanked around 15%. Analysts attributed over-spending on AI as the reason for the climbdown.

Today, the tremors were felt in Canada too, where the IT sector performed weakly.

On the business front, discount retailer Dollarama announced its results for the third quarter ending November 2. The company reported a profit of $321.7 million. Its sales totalled $1.91 billion. Net earnings increased 16.6% to $321.7 million. The gross margin was 44.8% of sales. Diluted net earnings per common share rose 19.4% to $1.17.

Major sectors that gained in today's trading were Materials (3.14%), Industrials (0.61%), Financials (0.36%), and Consumer Discretionary (0.31%).

Among the individual stocks, Terravest Capital Inc (22.33%). Perpetua Resources Corp (13.52%), New Gold Inc (9.09%), First Majestic Silver Corp (6.93%), Bombardier Inc (4.19%), and Bank of Montreal (1.76%) were the prominent gainers.

Major sectors that lost in today's trading were Real Estate (0.01%), Consumer Staples (0.28%), Communication Services (0.38%), Energy (0.72%), and IT (1.01%).

Among the individual stocks, Dye & Durham Ltd (3.05%), Coveo Solutions Inc (1.81%), Parex Resources Inc (3.67%), International Petroleum Corp (3.49%), and Telus Corp (1.58%) were the notable losers.