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Canadian Markets Rise to 21-Year High After Tumultuous Month

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  //stocks-investing.news-articles.net/content/202 .. rise-to-21-year-high-after-tumultuous-month.html
  Published in Stocks and Investing on Friday, November 28th 2025 at 17:38 GMT by Toronto Star

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Canadian Markets Turn Positive After a Tumultuous Month – A 500‑Word Summary

After a volatile run‑up that left investors wary and markets rattled, the Canadian equity market is finally showing signs of resilience. The Toronto Stock Exchange’s benchmark, the S&P/TSX Composite Index, rebounded 0.9 % on Friday, rising to a 21‑year high of 21,000.6. The rise followed a month of choppy trading that had been punctuated by a sharp dip in the United States and a slew of global economic uncertainties. Below is a detailed summary of the story, including key drivers, broader context, and the ramifications for investors, drawn from the original The Star article and its linked sources.

1. A Slow‑Roll Rebound

The TSX’s recovery came after a month that saw the index swing from the high 20,000s down to the low 19,000s, spurred by worries over U.S. recession signals and global supply‑chain bottlenecks. The current rebound, anchored by gains in the financial and energy sectors, was a welcome relief for traders who had been holding off on buying as risk‑aversion lingered.

While the TSX climbed 0.9 %, the Canadian dollar also enjoyed a modest lift, moving 0.5 % higher against the U.S. dollar. The currency’s improvement was a combination of better than expected domestic economic data and the U.S. Federal Reserve’s tentative shift toward a “gradual easing” stance, as discussed in a linked Financial Post analysis of Fed minutes.

2. Sector‑By‑Sector Gains

• Financials: Banks were the flagship of the recovery, up 1.3 % on the day. The Toronto‑based banks, which are often viewed as “safe‑haven” assets in times of volatility, pulled the index up on the back of stronger loan growth forecasts and higher net interest margins. Notably, Bank of Nova Scotia (BNS) saw a 1.5 % gain, while Royal Bank of Canada (RY) edged 1.2 % higher.

• Energy & Materials: The energy sector led the way in the market’s climb. Oil‑price gains, which have been a catalyst for energy stocks, lifted the sector 2.4 %. Suncor Energy (SU) and Canadian Natural Resources (CNQ) both posted double‑digit percentage gains, buoyed by a 3.6 % rise in Brent crude. The CIBC research note linked in the article highlighted that oil prices are expected to stay in the $70–$80 per barrel range for the next quarter, further supporting this upward trajectory.

• Technology & Communications: While the technology sub‑index lagged behind its U.S. counterpart, it still posted a 0.6 % gain. The Shopify (SHOP) and Lightspeed Commerce (LSPD) stocks provided a boost to the sub‑index, offsetting declines in more volatile U.S. tech names like Amazon (AMZN) and Apple (AAPL) that saw small but significant drops earlier in the month.

• Consumer & Industrial Goods: These sectors offered a muted performance. Walmart Canada (WMT) held steady, and the Canadian Tire (CT) index was flat. Industrial giants such as Bombardier (BBD.B) and Magna International (MG) posted small but noteworthy gains, reflecting investor optimism about the Canadian manufacturing outlook.

3. Macro Drivers – Why the Markets Turned Up

3.1. U.S. Economic Data

One of the primary reasons for the Canadian index’s uptick was the release of the U.S. unemployment rate on the day of the article, which came in at 4.1 % – slightly lower than the 4.2 % forecast. The decline, coupled with the Norton Rose’s commentary on improved consumer sentiment, was interpreted by many as a sign that the U.S. economy might be on a steady path toward full employment, thereby lessening the probability of a deep recession.

3.2. Federal Reserve Policy Outlook

The Fed’s “pause‑now‑then‑cut” stance, as elaborated in a linked Bloomberg article, seemed to gain traction after the release of the Fed’s policy statement that day. Traders anticipated that the Fed would likely hold rates steady for the next two quarters before initiating cuts. The reduced rate‑cut risk was a key catalyst for the TSX’s upward movement.

3.3. Global Supply Chain & Trade Issues

While the article referenced a Reuters piece that detailed ongoing disruptions in the global supply chain, it also highlighted that the Canadian market was less exposed to the bottlenecks that had snarled U.S. and European markets. Moreover, the Canadian government’s newly announced tariff relief on imported goods, mentioned in the Government of Canada press release linked within the story, was seen as a boon for domestic manufacturers.

3.4. Commodity Prices

The Reuters link within the article pointed to the fact that copper and aluminium futures had risen by 2 % during the day, reflecting broader demand from China. The CIBC commodity research noted that commodity‑heavy Canadian stocks benefit disproportionately from such price moves, and they expect a modest uptick in the coming weeks as China’s economic data remain positive.

4. Investor Sentiment & Risk Appetite

The Canadian Investment Report cited in the article indicated that the CBOE VIX – the fear gauge for the U.S. market – dropped 3 % during the day, signaling a shift toward a more risk‑tolerant mindset. Meanwhile, the Bank of Canada’s recent survey of small‑to‑medium‑size businesses (SMBs) displayed an improving outlook for domestic demand, which further buoyed equity prices.

5. What to Watch Next

The article concluded with a brief look ahead, noting that the market will be closely watching:

1. U.S. CPI (Consumer Price Index) – The June reading, due in a week, will offer clues on whether inflation remains sticky.
2. Federal Reserve minutes – The details on whether a “forward guidance” shift will occur could impact the market’s risk appetite.
3. Canadian GDP data – The Q2 growth figures, due in two weeks, will further clarify the strength of the domestic economy.

Additionally, a Bloomberg piece linked within the article suggested that Canadian miners and energy companies may continue to be catalysts for equity gains if global commodity prices remain favorable.

Bottom Line

The Toronto Star’s article paints a picture of a market that has finally found its footing after a month of uncertainty. While risk factors – particularly those related to the U.S. economy – still loom, the TSX’s rise is underpinned by solid performances in the financials and energy sectors, supportive macro data, and a gradual shift in policy expectations from the U.S. Federal Reserve. For Canadian investors, the headline message is clear: the market’s resurgence may be an opportunity to reassess portfolios, especially in sectors that have historically outperformed during periods of global economic strain. The forthcoming economic data releases will be crucial to confirm whether the positive trend will sustain or if volatility is still to come.