Canada’s main stock index closed at a record high on Monday, fueled by positive sentiment from Wall Street and gains in mining and tech stocks.
Toronto’s S&P/TSX composite index climbed 60.20 points, or 0.20%, to 30,531.88, closing its seventh consecutive session of gains and building on its 2.4% gain from the previous week.
The bullish momentum mirrored Wall Street, where markets rallied after AMD announced a chip-supply partnership with OpenAI, becoming the latest in a series of artificial intelligence deals that have driven markets higher recently.
“The market just keeps climbing higher and it feels like commodities are definitely leading. Gold is on US$4,000 watch... It’s putting more emphasis on the materials sector,” said Greg Taylor, chief investment officer at PenderFund Capital Management.
Materials stocks added 1.3%, bolstered by gold prices reaching historic highs. The precious metal benefited from safe-haven demand and growing expectations for an interest rate cut at the U.S. Federal Reserve’s October meeting.
TSX’s information and technology sector gained 0.3%, led by cryptocurrency miner Bitfarms, which soared 14.8% as bitcoin rose to an all-time high above US$125,000.
The energy sector contributed to the positive momentum, rising 1.6%, after oil prices increased about 1% on the day as OPEC+’s planned production increase for November was more modest than expected.
On Tuesday, Canadian Prime Minister Mark Carney will meet U.S. President Donald Trump in Washington to discuss economic and security issues as the two nations review a North American trade pact.
“Hopefully there is some good news to come. It does feel like the switch is flipped and Trump is trying to become more market-friendly,” Taylor said.
While a U.S. government shutdown entering its sixth day has paused economic data releases south of the border, Canadian investors are turning their attention to domestic employment figures expected later this week.
On Wall Street, both the Nasdaq and the S&P 500 reached record closing highs, while the blue-chip Dow inched lower.
Chips took the lead after AMD said it would supply AI chips to OpenAI in a deal that could generate tens of billions of dollars in yearly revenue and would allow the ChatGPT creator to buy a stake of up to 10% in the chipmaker. AMD surged 23.7%, while the broader Philadelphia Semiconductor Index rose 2.9%.
“The market is seeing some strength in areas like technology and consumer discretionary and it’s flying in the face of the government shutdown,” said Robert Pavlik, senior portfolio manager at Dakota Wealth in Fairfield, Connecticut. “The market is still interested in the AI trade and the companies that support and use it.”
“It’s a wave and waves don’t go on forever; it will eventually crest and decline,” Pavlik added. “But where are we this cycle of the wave? It’s impossible to know.”
Without new U.S. government data this week, market participants are monitoring reports on outstanding consumer credit, mortgage demand and the University of Michigan’s preliminary take on October consumer sentiment.
Next week, third-quarter earnings will provide market catalysts as the reporting season gets underway with results from large U.S. banks.
Analysts estimate aggregate year-on-year S&P 500 earnings growth of 8.8% for the July-to-September period, up 0.8 percentage points from projections at the beginning of the third quarter, according to LSEG data.
Tesla advanced 5.5% after the electric carmaker teased an event scheduled for Tuesday on social media platform X over the weekend.
TD Cowen cut its Starbucks price target, citing a weakening labor market affecting Generation Z, sending the coffee chain’s shares down 5.0%.
The Dow Jones Industrial Average fell 63.31 points, or 0.14%, to 46,694.97, the S&P 500 gained 24.49 points, or 0.36%, to 6,740.28 and the Nasdaq Composite gained 161.16 points, or 0.71%, to 22,941.67.
Among the 11 major sectors of the S&P 500, consumer discretionary led the gainers, while real estate suffered the steepest percentage decline.
Among other U.S. stocks, Regional bank Comerica gained 13.7% after Fifth Third said it will buy the company in an all-stock deal valued at $10.9 billion. Verizon shares dipped 5.1% after the telecommunications company named former PayPal boss Dan Schulman as its new chief executive officer.
Advancing issues outnumbered decliners by a 1.05-to-1 ratio on the NYSE. There were 665 new highs and 75 new lows on the NYSE. On the Nasdaq, 2,602 stocks rose and 2,062 fell as advancing issues outnumbered decliners by a 1.26-to-1 ratio. The S&P 500 posted 46 new 52-week highs and nine new lows while the Nasdaq Composite recorded 187 new highs and 58 new lows.
Volume on U.S. exchanges was 19.69 billion shares, compared with the 19.17 billion average for the full session over the last 20 trading days.
Reuters, Globe staff