TSX Hits Record as Gold Miners Rally

The S&P/TSX Composite Index rose 0.7% to a record close of 36,381 on Friday, led by a rally in mining stocks. Gold prices surged after weaker-than-expected US labor data and lower energy prices reduced expectations of a Federal Reserve rate hike this year. The US economy unexpectedly lost jobs in July, easing concerns that labor market strength could fuel inflation. Agnico Eagle climbed 5.9%, Barrick gained 5%, and WPM jumped 6.6%, while other gold miners advanced between 2.6% and 14%. Tech stocks also benefited from the positive sentiment on Wall Street, with Shopify rising 2.4%. In contrast, financials underperformed after stronger-than-expected Canadian jobs data increased the likelihood that the Bank of Canada could resume tightening if inflation pressures persist. RBC fell 0.7% and TD Bank lost 0.4%.

The S&P/TSX Composite Index rose over 0.5% to trade above 36,000 on Friday, reaching a fresh record as mining stocks rallied. Gold prices surged as weaker US labor data and lower energy prices reduced expectations of a Federal Reserve rate hike this year. The US economy unexpectedly shed jobs in July, while oil prices wavered amid uncertainty over a potential US-Iran deal to restore exports through the Strait of Hormuz. Agnico Eagle and WPM jumped over 7%, while Barrick gained 5.5% and other gold miners rose between 4% and 10%. In contrast, banking and broader sectors weakened as strong Canadian employment data raised the prospect of a BoC rate hike if energy prices remain elevated. Canada's unemployment rate fell 0.1 percentage point to 6.4%, slightly below forecasts of 6.5%, while employment increased by 75,000, well above expectations for a 15,000 gain. RBC and TD Bank both shed about 0.5%.

Futures tracking the S&P/TSX Composite Index moved higher on Friday after the release of Canadian employment data and a key US jobs report. Canada's unemployment rate edged down 0.1 percentage point to 6.4%, slightly below forecasts of 6.5%, while employment increased by 75,000, well above expectations for a 15,000 gain. In the US, the economy unexpectedly shed 23,000 jobs, compared with forecasts for an 80,000 increase. The strong Canadian labor backdrop and softer US employment conditions limited risks of a hawkish Fed while strengthening the case for a potential hike by the BoC, should energy prices remain higher. Meanwhile, oil prices were volatile as markets assessed Iran-Oman negotiations, easing energy inflation concerns and supporting financial stocks and the broader index. Gold prices also rose as expectations of US rate hikes receded, boosting mining stocks.