Canadian Stocks Rise Sharply Amid Robust Bank Earnings, Fed Rate Cut Expectations

(RTTNews) - Canadian stocks gained sharply on Thursday after Canadian lenders posted strong quarterly results, signaling underlying resilience in the economy despite the damage due to U.S. tariffs, along with reinforced expectations of a Federal Reserve rate cut next week.

After opening above yesterday's close, the benchmark S&P/TSX Composite Index gained momentum to trade firmly positive throughout the session before settling at 31,477.57, up by 317.03 points (or 1.02%).

Eight of the 11 sectors posted gains today, with the healthcare sector leading the pack.

Today, data from Ivey Business School revealed that the Purchasing Managers' Index (PMI) tumbled to 48.4 in November from 52.4 in October, indicating the first contraction after five consecutive months of expanding economic activity.

Canadian Prime Minister Mark Carney is travelling to Washington, D.C. tomorrow for the Final Draw ceremony of the FIFA World Cup 2026 where he will represent Canada.

The draw will finalize matchups for the next year's tournament which will be hosted by Canada, the United States, and Mexico and will feature 48 teams for a total of 104 matches out of which 13 matches are to be hosted in Canadian sports fields and is expected to generate around 25,000 jobs and add around $2 billion to the economy.

Reports indicate that possibility for the resumption of trade talks between the U.S. and Canada, which Trump halted abruptly, during Carney's November 5 visit is low.

Carney is facing pressure from the opposition and domestic business houses as the U.S. levies are denting revenues considerably.

Currently, Canadian exports to the U.S. suffer a 35% tariff although products falling under the Canada-United States-Mexico Agreement (CUSMA) pass into the U.S. freely.

The tripartite free-trade agreement between Canada, United States, and Mexico is up for renewal.

U.S. President Donald Trump hinted yesterday that the U.S. may want to rework the tenets before drawing a new agreement or even withdraw from the deal altogether. Trump's remarks have raised concerns in Canada that the U.S. may attempt to squeeze more from the two nations.

Expectations of a rate cut by the U.S. Federal Reserve based on recent employment data have increased in the U.S.

In Canada, analysts feel that the Bank of Canada would keep its policy rate on hold despite the weakness in domestic demand as inflationary pressures remain.

On the business front, Toronto-Dominion (TD) Bank hiked its dividend (to $1.08 per share) after reporting that its fourth-quarter profit fell in comparison to last year. TD stated that its profit amounted to $3.28 billion for the quarter ending October 31. Revenue for the quarter totalled $15.49 billion.

The Canadian Imperial Bank of Commerce (CIBC) reported solid financial results for the fourth quarter of 2025. While the bank's revenue reached C$7.58 billion and net earnings stood at C$8.5 billion, earnings per share came at C$2.21. The bank has increased its quarterly dividend by 10%.

Bank of Montreal (BMO) reported an adjusted EPS of $3.28 beating forecasts. The bank's revenue stood at $9.34 billion. While the company achieved a record net income of $9.2 billion for the full year, it increased its dividend by 5% to $1.67 per share.

Major sectors that gained in today's trading were Healthcare (3.03%), IT (2.73%), Financials (1.43%), and Consumer Staples (1.29%).

Among the individual stocks, Curaleaf Holdings Inc (9.73%), Bausch Health Companies Inc (4.77%), Descartes Sys (14.37%), Celestica Inc (4.64%), Eqb Inc (12.85%), and Mda Ltd (9.79%) were the prominent gainers.

Major sectors that lost in today's trading were Communication Services (0.06%), Real Estate (0.24%), and Utilities (0.43%).

Among the individual stocks, Rogers Communications (0.70%), Dream Industrial REIT (1.71%), Northwest Healthcare (0.93%), and Superior Plus Corp (1.78%) were the notable losers.