Canada’s stock market continued its record‑setting run on Thursday, with the S&P/TSX Composite Index trading just above the 31,500 mark as investors weighed surging metal prices, a fresh trade surplus, and this week’s back‑to‑back interest‑rate decisions from the Bank of Canada and the U.S. Federal Reserve. [1]
By late morning in Toronto, the S&P/TSX was up about 0.3% around 31,546, a new intraday high, after briefly opening in the red. [2] Gains in gold and base‑metal miners offset a sharp pullback in technology shares and another weak session for energy stocks, leaving the Canada stock market today looking more like a sector‑rotation story than a broad rally.
TSX Today: Index Hovers Near Record Territory
On Wednesday, the S&P/TSX Composite closed at a record high of 31,490.85, up 0.8% on the day, after interest‑rate announcements from both the Bank of Canada (BoC) and the Federal Reserve came in largely as expected. [3]
Thursday’s session has extended that momentum:
- Intraday high: Around 31,546 points by 10:10 a.m. ET, roughly 0.3% higher on the day. [4]
- Open: The index initially dipped about 0.07% at the open to 31,470 before reversing higher. [5]
- Leadership: Metals & mining, precious metals, and consumer discretionary shares. [6]
- Laggards: Information technology and energy stocks, both moving lower despite the broader index gain. [7]
The intraday move caps what has already been an exceptional year for Canadian equities. Royal Bank of Canada’s 2026 outlook notes that the S&P/TSX Composite is on track to be one of the best‑performing developed‑market indices in 2025, with total returns near 25% year‑to‑date as of late November, driven heavily by surging gold prices and stronger sentiment toward domestic lenders. [8]
Edward Jones’ latest weekly market wrap, published December 5, puts TSX year‑to‑date gains even higher at roughly 27% in local‑currency terms, and about 39% from the April lows, underscoring just how persistent this rally has been. [9]
Central Banks in Focus: BoC Pauses as Fed Cuts Again
Bank of Canada holds at 2.25%
On Wednesday, the Bank of Canada left its policy rate unchanged at 2.25%, marking a pause after a series of cuts that began in mid‑2024. [10]
Key points from the BoC’s December 10 decision:
- The overnight rate stays at 2.25%, with the Bank Rate at 2.50% and the deposit rate at 2.20%. [11]
- Q3 GDP grew at an annualised 2.6%, stronger than expected, though the Bank noted much of that was driven by volatile trade flows. [12]
- The unemployment rate fell to 6.5% in November, and recent job gains have been solid, but trade‑exposed sectors remain under pressure. [13]
- Headline inflation slowed to 2.2% in October, with core measures in the 2.5–3.0% range; the Bank judges underlying inflation to be about 2.5%. [14]
The BoC explicitly said it sees the current rate as “about the right level” to keep inflation near 2% while the economy adjusts to trade disruptions — a signal that the cutting cycle is likely over unless the outlook deteriorates. [15]
Fed cuts rates again – and hints at a pause
South of the border, the U.S. Federal Reserve cut its benchmark rate by 25 basis points on December 10, bringing the federal funds target range down to 3.50–3.75%, its third quarter‑point cut of 2025. [16]
In contrast to earlier in the year:
- The Fed is now signalling a pause, with policymakers projecting only one additional rate cut in 2026, even as markets price in more easing. [17]
- The decision was deeply divisive, with multiple dissenting votes and a wide range of views on the future path of rates. [18]
For Canadian investors, the combination of a steady BoC and a cautiously easing Fed keeps the policy gap relatively narrow, supporting the Canadian dollar and helping sustain demand for risk assets like equities and high‑yielding dividend stocks.
Commodities Drive Sector Rotation: Metals vs. Oil
Precious metals and copper support resource stocks
One of the defining features of Canada’s stock market today is the interplay between record‑high metals prices and weak oil.
On Thursday:
- Gold prices eased modestly after the Fed decision but remain elevated, with futures trading above US$4,200 per ounce. [19]
- Silver hit yet another record, briefly touching around US$62–63 per ounce, more than doubling year‑to‑date. [20]
- Copper prices remain near historic highs after repeatedly breaking records above US$11,000 per tonne in recent weeks, driven by tight supply and resilient demand. [21]
These moves are feeding directly into the TSX:
- Gold and mining sub‑indices jumped nearly 2% in early Toronto trading, making materials one of the best‑performing sectors on the day. [22]
- Traders cite ongoing strength in gold and industrial metals, alongside year‑end portfolio rebalancing, as catalysts for the rotation back into resource names. [23]
Over a longer horizon, RBC’s 2026 outlook notes that materials and financials together account for a large share of the TSX’s 2025 total return, highlighting how the index has benefitted from both precious‑metal strength and improving prospects for domestic banks. [24]
Oil slides, weighing on energy stocks
Energy is the other side of the story. Crude prices are under renewed pressure:
- WTI crude is trading near US$57–58 per barrel, down roughly 1.5–2% on the day. [25]
- Brent crude sits around US$61, also lower by nearly 2% and well below its January highs above US$80. [26]
- The International Energy Agency’s latest oil market report still sees demand rising into 2026, but notes that high supply and structural changes in consumption are capping prices. [27]
The TSX energy index is down about 1% today, reflecting this “super‑glut” narrative in crude, even as natural gas has been relatively firmer. [28]
For the Canada stock market today, that means a tug‑of‑war: metals pushing the index up, oil dragging it down.
Sector and Stock Movers on the TSX Today
According to early‑session data and Reuters reporting, Thursday’s key movers on the Toronto Stock Exchange include: [29]
Winners
- Mining & materials:
- Consumer discretionary – Dollarama:
- Dollarama shares are up about 2.3% after the discount retailer raised its full‑year sales forecast, beating quarterly revenue and earnings expectations as inflation‑weary consumers continue to trade down to cheaper household goods and groceries. [32]
Losers
- Technology:
- Energy:
- The energy index is off about 1%, reflecting the slide in WTI and Brent prices and ongoing concerns about a multi‑year oil oversupply. [35]
The result is a classic sector‑rotation day: investors are trimming high‑flying tech names and under‑pressure oil producers and redeploying capital into defensive growth plays like Dollarama and commodity‑linked miners that benefit from the metal upcycle.
Macro Backdrop: Trade Surplus and Stronger Household Balance Sheets
Canada returns to trade surplus
Fresh data released Thursday show that Canada’s external position is improving just as the Canada stock market todaypushes deeper into record territory.
Statistics Canada reported that in September 2025, Canada recorded a C$153 million merchandise trade surplus, its first surplus since January and a sharp reversal from a C$6.43 billion deficit in August. [36]
Highlights from the trade report:
- Exports rose 6.3% to C$64.23 billion, the largest monthly percentage increase since early 2024. [37]
- Gains were broad‑based across 9 of 11 product groups, led by metals, non‑metallic mineral products, aircraft and transportation equipment, and unwrought gold. [38]
- Imports fell 4.1% to C$64.08 billion, with declines from both U.S. and non‑U.S. sources. [39]
- Canada’s surplus with the United States jumped 44%, reaching its highest level since February and helping offset deficits with the rest of the world. [40]
Economists interviewed by Reuters described the report as evidence that Canada’s trade flows are finally starting to normalise after months of disruption related to U.S. tariffs and a lengthy federal government shutdown in Washington that delayed data releases. [41]
The Canadian dollar firmed slightly on the news, trading around C$1.38 per U.S. dollar (roughly 72.6 U.S. cents), while short‑term bond yields ticked lower — a combination that generally supports equity valuations by signalling less macro stress. [42]
Household net worth surges alongside the TSX
On the domestic front, new numbers from Statistics Canada’s National Balance Sheet Accounts show how much the stock‑market rally has boosted Canadian household wealth: [43]
- Household net worth rose 2.6% in Q3 2025 to C$18.4 trillion, the largest gain since early 2024.
- Financial assets jumped 4.8% (about C$532 billion), reflecting strong appreciation in equities and investment funds as markets rallied.
- The S&P/TSX Composite climbed 11.8% in Q3 and 20.5% across Q2 and Q3 combined, making equities a major driver of wealth gains.
- Household debt continued to grow, but debt‑service ratios edged lower thanks to lower interest rates and easing mortgage costs.
The report underscores why consumer spending has held up even in the face of tariffs and elevated price levels: wealth effects from rising portfolios are offsetting pressure from higher debt and still‑high living costs, particularly for higher‑income households that hold most of the financial assets. [44]
Valuations and Outlook: How Expensive Is the Canada Stock Market Today?
With the TSX hovering around record highs, the obvious question for investors is whether the Canada stock market today is getting too expensive.
RBC Wealth Management’s “Global Insight 2026 Outlook: Canada” offers a useful lens: [45]
- The S&P/TSX trades at about 15.9× forward earnings, above its long‑term average of 14.7×, but still at a meaningful discount to the S&P 500’s 21.3× multiple.
- That valuation premium versus history implies higher expectations for earnings and growth, but the discount to U.S. equities suggests Canada may still offer relative value, especially in sectors like financials and materials.
- RBC sees recent federal budget measures — roughly C$280 billion in additional spending and investment commitments over five years — as a potential tailwind for Canadian corporates, particularly in infrastructure, productivity, and housing‑related industries.
- On the fixed‑income side, RBC argues that a steeper Canadian yield curve makes it more attractive to add duration via longer‑term government bonds, while corporate credit spreads look tight and less compelling.
Edward Jones, in its December 5 weekly wrap, summarises the equity picture this way: after double‑digit gains for U.S. and Canadian stocks in 2025, investors should rebalance portfolios and lean into diversification, rather than assume the recent rally will continue unchecked. The firm remains overweight Canadian materials, industrials, and energy into 2026, reflecting the multi‑year commodity and infrastructure themes. [46]
What Today’s Moves Mean for Canadian Investors
Putting it all together, here’s how Canada’s stock market today looks from a practical, medium‑term perspective:
- Macro backdrop is supportive but not risk‑free
- Growth is positive but uneven; Q3 GDP surprised to the upside at 2.6%, yet the BoC still expects a softer patch in coming quarters as trade swings normalise. [47]
- Inflation is close to target, giving the BoC flexibility to stay on hold—especially now that the Fed has also shifted into “pause” mode after three cuts. [48]
- Metals boom vs. oil glut is reshaping the TSX
- Valuations are rich but not extreme
- TSX multiples sit above long‑run averages but below the U.S., implying less room for disappointment but also a margin of safety versus Wall Street if global risk sentiment sours. [51]
- Household and corporate balance sheets are healthier than headlines imply
- Rising financial‑asset values, falling debt‑service ratios, and a stabilising trade picture all temper concerns about a near‑term downturn, even with elevated household debt. [52]
For individual investors, that mix argues less for dramatic market timing and more for disciplined positioning:
- Avoid over‑concentration in a single theme (for example, AI‑heavy tech or a single commodity).
- Use the current strength in Canadian equities to rebalance toward long‑term target allocations if stocks have drifted to an outsized share of your portfolio. [53]
- Focus on companies — and funds — with strong balance sheets, sustainable earnings, and solid cash‑flow generation, which are better placed to weather any volatility from tariffs, Fed uncertainty, or commodity swings. [54]
Key Takeaways on the Canada Stock Market Today (December 11, 2025)
- The S&P/TSX Composite is trading around 31,500, near a fresh intraday record, after closing at a record 31,490.85 on Wednesday. [55]
- Mining and materials stocks are leading thanks to record or near‑record prices in gold, silver, and copper, while tech and energy shares lag. [56]
- The Bank of Canada has paused rate cuts at 2.25%, and the Fed just delivered its third 25‑bp cut of 2025, now signalling a pause with only limited easing expected in 2026. [57]
- Canada has posted its first trade surplus since January, while household net worth has surged on the back of strong equity markets. [58]
- Strategists from major institutions see Canada’s stock market as one of 2025’s standout performers, but stress the importance of diversification and quality as valuations move above historical norms. [59]
As always, this article is for information only and is not personal investment advice. If you’re thinking about repositioning your portfolio in light of today’s moves on the TSX, it’s worth considering your own risk tolerance, time horizon, and the role Canadian equities should play in your long‑term plan.
References
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