Canada’s main stock index rose to another record high on Friday as gold mining shares climbed and investors cheered this week’s rate cuts by the country’s central bank and the U.S. Federal Reserve.
Wall Street’s three major stock indexes also closed higher.
The S&P/TSX composite index ended up 314.83 points, or 1.1%, at 29,768.36, surpassing Thursday’s record closing high. For the week, the index was up 1.7%, its seventh straight weekly gain. That is the longest such streak since February 2024.
“The Bank of Canada’s recent rate cut was a shot in the arm that the market was looking for,” said Victor Kuntzevitsky, a portfolio manager at Stonehaven, Wellington-Altus Private Counsel. “It’s a clear signal that the bank is confident in the inflation trajectory and is now pivoting to support economic expansion. And in our view, this has fundamentally repriced risk for investors and provided a clear tailwind for Canadian equities.”
Canadian retail sales fell 0.8% in July but an advanced indicator pointed to sales rebounding by 1% in August. On Wednesday, the BoC reduced its key policy rate to a three-year low of 2.5% and said it was prepared to cut further if risks to the economy rose.
The materials sector, which includes fertilizer companies and metal mining shares, jumped 3.9%, as the price of gold moved closer to another record high.
Gold and copper producer Barrick Mining Corporation was the top-performing stock, with its shares climbing 9.7%.
“The surge in gold stocks reflects a disciplined focus on cost management among Canadian producers,” Kuntzevitsky said. “We really feel that investors are rewarding companies with strong operational efficiencies that can turn higher gold prices directly into shareholder value.”
The TSX consumer staples sector gained 1.3% and heavily weighted financials were up 0.9%.
Just two of 10 major TSX sectors ended lower, including energy . Energy lost 2.2% as the price of oil settled 1.4% lower at US$62.68 a barrel on worries about large supplies and declining demand.
Wall Street’s main indexes also posted weekly gains. In Friday trading, FedEx rose after positive earnings. The parcel delivery company popped 2.1% after it reported quarterly profit and revenue above analyst estimates on Thursday, as cost-cutting and strength in domestic deliveries helped offset weaker international volumes.
Apple rose 3.2% following a price target raise from J.P. Morgan, while gains in Palantir Technologies and Oracle also drove the S&P 500 technology sector up 1.19%.
Seven of the 11 S&P sector indexes rose, while energy stocks were the biggest drag. The S&P 500 and the Nasdaq notched their third straight week of gains, boosted by the Fed’s first rate cut of 2025 and indications of further monetary policy easing. Revived optimism around AI-linked stock trading also added to the rise.
Wall Street wavered earlier in the day as investors continued to digest the Fed’s outlook and get a read on Stephen Miran, its newest governor and White House economic adviser, who spoke on CNBC on Friday morning.
“Certainly if the idea is the Fed is moving in a direction to relax the inflation target, that is definitely a recipe for running hot, and that’s good for stocks,” said Scott Ladner, chief investment officer at Horizon Investments.
The Dow Jones Industrial Average rose 172.85 points, or 0.37%, to 46,315.27, the S&P 500 gained 32.40 points, or 0.49%, to 6,664.36 and the Nasdaq Composite gained 160.75 points, or 0.72%, to 22,631.48.
For the week, the S&P 500 rose 1.2%, the Nasdaq climbed 2.2% and the Dow added 1.05%. The small-cap Russell 2000 index dropped 0.71% after briefly hitting an intraday record high. It notched a record close on Thursday, its first since November 2021.
“Small caps have been trading inversely with rates, and it’s just the idea of small caps benefiting disproportionately from lower interest rates,” Ladner said.
Meanwhile, U.S. President Donald Trump and Chinese counterpart Xi Jinping spoke by phone, after which Trump said that the two leaders made progress on a TikTok deal and agreed to a face-to-face meeting as soon as next month in South Korea. Also on Friday, the Senate blocked a short-term funding bill, increasing the likelihood of a U.S. government shutdown.
Wall Street’s three main indexes are in positive territory so far in September - a month traditionally deemed bad for U.S. equities. The benchmark S&P 500 has shed 1.4% on average in the month since 2000, according to data compiled by LSEG.
In other stock news, Lennar fell 4.2% after the homebuilder reported a lower third-quarter profit and forecast fourth-quarter home deliveries below estimates.
Paramount Skydance jumped 5.9% after a CNBC report laid out more details about the media company’s potential bid for Warner Bros Discovery, which rose 3.4%. An offer could come later than previously expected, according to CNBC.
Declining issues outnumbered advancers by a 1.43-to-1 ratio on the NYSE, and by a 1.42-to-1 ratio on the Nasdaq. The S&P 500 posted 30 new 52-week highs and 17 new lows while the Nasdaq Composite recorded 151 new highs and 54 new lows. Volume on U.S. exchanges was 26.33 billion shares, compared with the 17.41 billion average for the full session over the last 20 trading days.
Reuters, Globe staff