Energy Sector Drives Canadian Stock Market Higher Amid Trade Discussions

Canada’s primary stock index saw gains on Thursday, spearheaded by energy stocks, as investors monitored trade discussions between the U.S. and Japan. However, market sentiment remained cautious due to uncertainties surrounding tariffs.

The S&P/TSX Composite Index on the Toronto Stock Exchange increased by 0.16%, reaching 24,141.14 points. If the gains are sustained, it is on track for its most significant weekly increase since September 2024.

The energy sector was a primary driver of the day’s gains, surging by 1.8% as crude oil prices reached a two-week high.

The financial markets have been closely watching the evolving trade policies of the U.S. administration, with investors awaiting potential agreements between the United States and its trade allies.

U.S. President Donald Trump highlighted “big progress” in tariff discussions with Japan on Wednesday. Japanese representative Ryosei Akazawa confirmed a second meeting is scheduled for later this month, although he provided few details, noting Trump identified an agreement with Japan as a “top priority.”

David Ferreira, portfolio manager at Harbourfront Wealth Management, commented that “Markets tend to respond favorably when protectionist risks diminish.”

Resource stocks were instrumental in boosting the Toronto stock market’s weekly performance.

“A consistent trading relationship between two major global economies bolsters confidence in global supply chains and demand forecasts — both of which are vital for Canadian exporters and commodity producers,” Ferreira added.

Bond proxy utilities experienced a 1.3% increase, while Canada’s 10-year bond yield decreased to 3.090% after a sharp rise in the previous session. Heavily weighted financials rose by 0.3%.

Constraining the gains, the materials sector, which includes metal mining stocks, declined by over 1% as gold prices receded from a record peak due to profit-taking.

Healthcare stocks decreased by 0.3%, with cannabis company Tilray Brands falling by 5%, positioning it at the bottom of the benchmark index.

Canadian stock markets will be closed on Friday in observance of the Good Friday holiday.