Canadian Stocks Hit Fresh Record High

Canada's S&P/TSX Composite Index rose 1.2% to a record closing high of 35,217 on Thursday, supported by improving global risk sentiment following reports of a conditional ceasefire between Israel and Lebanon, which fueled hopes that a broader agreement involving Iran could be reached. Healthcare, industrial, and financial stocks led the advance, while battery metals and telecommunications shares underperformed. Among the top gainers were Royal Bank of Canada (+1.9%), Toronto-Dominion Bank (+1.2%), Agnico Eagle Mines (+2.9%), and Barrick Mining Corporation (+2.1%). In contrast, TransAlta Corporation and Transcontinental were the session's weakest performers, falling 10.4% and 9.8%, respectively.

Canada's S&P/TSX Composite index rose nearly 1% to over 35,000, approaching the record high from Monday and outperforming US counterparts due to strong support from miners and heavyweight banks. Energy costs pulled back as markets assessed the validity of a ceasefire between Lebanon and Israel, which could lead to a an agreement between Iran and the US. The development lowered yields and lifted gold prices, supporting miners traded in Toronto. Agnico Eagle and Barrick both jumped more than 3%. In turn, the drop in yields drove banks to enjoy some respite as high credit costs have driven lenders to set more capital aside for provisions. RBC, TD, and BMO added close to 1%. The domestic labor market data due tomorrow is expected to be muted and consolidate bets of no rate changes by the Bank of Canada this year.

Canadian equity futures were flat on Thursday amid the lack of progress in the conflict between Iran and the US and fresh weakness in US counterparts. Reports of repeated clashes between Lebanon and Israel strained the ceasefire between both parties as Tehran and Washington were not any closer to lifting their blockade on tankers that would bring relief to pro-inflationary pressures globally. Data to be released tomorrow is expected to extend the current fragility in the Canadian labor market, with net employment and the unemployment rate set to remain unchanged after the stall in the GDP last quarter. Shopify was due to open lower premarket after poor earnings by US tech companies. Also, oil companies were due to ease on lower oil prices. Still, the rebound in gold prices aided miners traded in Toronto.