Canada’s main stock index rose to a record high on Tuesday, led by gains for metal mining shares, as investors shrugged off hotter-than-expected Canadian core inflation data and looked for further progress in the easing of global trade tensions.
The S&P/TSX composite index ended up 83.7 points, or 0.3%, at 26,055.63, eclipsing its record closing high on Friday. The market was closed on Monday for the Victoria Day holiday.
It was the 10th straight day of gains for the index, the longest daily winning streak since October 2021.
Finance leaders from the Group of Seven industrialized democracies will strive for unity on non-tariff issues when they meet in Canada this week, but may have trouble reaching consensus with a Trump administration intent on pushing allies to serve U.S. interests.
“All eyes are on the G7 this week,” said Michael Constantino, CEO of online investment platform Webull Canada. “Obviously we saw the U.S.-China deal easing some global tensions. I think that the framework might be in place this week when the G7 meets for some favourable results to ease all the trade fears.”
Canada’s annual inflation rate eased to 1.7% in April as energy prices dropped sharply after the removal of a federal consumer carbon tax but two key measures of underlying inflation rose above 3%, reducing expectations for a Bank of Canada interest rate cut next month.
The materials group climbed 3.5% as the price of gold rallied. The consumer staples sector was another standout, adding 1.5%, while technology was a drag, ending 1.4% lower.
On Wall Street, the major indexes posted modest losses, with the benchmark S&P 500 ending six straight sessions of gains, under pressure from rising Treasury yields
U.S. President Donald Trump traveled to Capitol Hill, seeking to persuade Republican lawmakers to pass a sweeping tax-cut bill, which analysts estimate will possibly add US$3 trillion-US$5 trillion to the federal government’s US$36.2 trillion in debt.
The Dow snapped three consecutive sessions of gains and the Nasdaq fell after a two-session winning streak.
Eight out of 11 of the S&P 500’s sectors fell, led by losses in energy, communication services, consumer discretionary stocks. Utilities, healthcare and consumer staples equities made gains.
“It’s a little bit of an excuse just after the run that we’ve had to hit the pause button and see markets consolidate a little bit and a little bit of churn under the surface ... that’s what we’re seeing right now,” said Garrett Melson, portfolio strategist at Natixis Investment Managers in Boston.
“But obviously when you look across to the fixed-income world, you’re seeing a huge bid that came back into the market yesterday. ... now we’re back to the races with yields pushing higher.”
The Dow Jones Industrial Average fell 114.83 points, or 0.27%, to 42,677.24, the S&P 500 lost 23.14 points, or 0.39%, to 5,940.46 and the Nasdaq Composite lost 72.75 points, or 0.38%, to 19,142.71.
Investors were also eyeing commentary on the monetary policy outlook from several Federal Reserve officials, including St. Louis Fed President Alberto Musalem.
Moody’s and the other big ratings agencies Fitch and S&P Global Ratings have downgraded the U.S. sovereign credit, citing the government’s debt profile.
Traders currently expect at least two 25-basis-point Fed rate cuts by the end of 2025, with the first expected in September, according to data compiled by LSEG. The yield on benchmark U.S. 10-year notes rose 0.4 basis points to 4.481%.
Home Depot fell 0.6%, reversing early gains, after the home improvement retailer reported first-quarter sales that beat Wall Street estimates.
Tesla rose 0.5% after Chief Executive Elon Musk said at an economic forum in Qatar that he was still committed to being CEO in five years.
Other technology heavyweight stocks fell, including Nvidia . The chipmaker is scheduled to report quarterly earnings on May 28.
Declining issues outnumbered advancers by a 1.37-to-1 ratio on the NYSE. There were 219 new highs and 33 new lows on the NYSE. The S&P 500 posted 19 new 52-week highs and no new lows while the Nasdaq Composite recorded 59 new highs and 46 new lows. Volume on U.S. exchanges was 16.14 billion shares, compared with the 17.38 billion average for the full session over the last 20 trading days.
Reuters, Globe staff