Canada’s stock market saw a positive close on Friday, marking a significant rise, with the S&P/TSX composite index gaining 103.68 points or 0.4%, ending at 25,357.74—the highest level since late February. This upward trend signals a robust performance throughout the week, with the index appreciating 1.3%, marking its fifth consecutive weekly increase.

Key Market Drivers: Energy and Materials Surge

The day’s gains were predominantly fueled by the energy and materials sectors, with mining stocks benefiting from rising gold and copper prices. The materials sector alone surged 2.8%, reflecting a strong market sentiment amidst easing trade tensions.

• Oil prices also saw an uptick, closing 3.2% higher at $59.91 per barrel.
• The energy sector recorded a 2% increase, while real estate stocks climbed 0.5%, benefiting from lower long-term borrowing costs.

Investor Sentiment Amid Trade Concerns

Despite these gains, concerns linger about the impact of U.S. tariffs on Canada’s export-driven economy, as evidenced by a rising unemployment rate of 6.9% in April—the highest since November. Investors are now pricing in a 67% likelihood that the Bank of Canada (BoC) will resume interest rate cuts next month, a notable increase from 46% prior to the latest employment figures. Portfolio manager Elvis Picardo from Luft Financial remarked, “While investors are hopeful for a resolution to trade disputes, such optimism may be misplaced.”

Air Canada and Tech Stocks Shine and Struggle

Air Canada emerged as a standout performer, with its shares soaring 14.6% following a quarterly loss that was smaller than anticipated. The airline also announced plans to buy back up to C$500 million (approximately $358.96 million) in shares by the end of next month, further boosting investor confidence.

On the flip side, the technology sector faced challenges, declining 1.5%. However, Telus Corp managed to defy the trend, with its stock rising 7.1% after reporting quarterly results that surpassed expectations.

Conclusion: A Resilient Market Outlook

As the Canadian market navigates through the complexities of trade uncertainties and economic indicators, the resilience shown by the TSX suggests a cautiously optimistic outlook. With investors keeping a close eye on potential rate cuts and ongoing trade discussions, the coming weeks could prove pivotal for market performance.

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