(Bloomberg) — Canadian stocks hit a new all-time high despite tariff threats and a weakening economy.
The S&P/TSX Composite Index rose 0.3% to climb above the key psychological threshold of 30,000 for the first time on Tuesday. The gauge has posted 45 closing records this year, the most since the recovery from the Covid-19 pandemic in 2021. The rally is being driven by stronger than expected earnings, a flight to shelter in gold names and easing in borrowing costs. And a fresh round of Bank of Canada interest-rate cuts is expected to stoke gains.
“It’s a big milestone obviously because it’s a nice round number,” said Philip Petursson, chief investment strategist at IGM Wealth Management, a firm with $143 billion in assets under management. He added the strength of the benchmark’s performance this year and the milestone would “drive investors to take another look at the TSX.”
The Toronto Stock Exchange is on track to outperform the S&P 500 Index this year for the first time in an up year for both markets since 2016. During that period the TSX suffered a smaller loss than the S&P 500 during the downturn of 2022.
Corporate earnings in Canada have, so far, beat expectations this year at a time when U.S. President Donald Trump has slapped the country with tariffs and when unemployment has trended higher. Amid economic weakening and trade uncertainty, earnings by TSX stocks came in 7.5% ahead of expectations and marked a new high, according to Hugo Ste-Marie, director of portfolio and quantitative strategy at Scotiabank.
“If we had to describe it in one word, we would say: wow!” Ste-Marie wrote in a Sept. 15 note.
Gold miners have been the biggest driver of the TSX rally this year as bullion prices have hit all-time highs and demand for safe haven assets amid geopolitical, trade and interest-rate uncertainty intensify.
According to Fiera Capital Corp. portfolio manager Candice Bangsund, gold represents nearly 12% of the TSX.
The benchmark’s leading sector, materials, has gained 72% this year on the the back of triple-digit gains from the likes of Discovery Silver Corp., SSR Mining Inc. and Lundin Gold Inc.
More support ahead
Bangsund, who said the Canadian equity markets is more attractively valued than its global peers, sees the materials sectors continuing to prop up the Toronto Stock Exchange through 2026.
“Even if there’s decreased demand for oil products or materials products from the U.S. from Canada, if a product like gold is becoming more expensive on net, it creates a bit of a buffer, a bit of an offset” for stocks, said Bloomberg Intelligence strategist Gillian Wolff.
Gold, which strengthens when interest rates fall, is expected to fuel further gains following rate reductions in Canada and the U.S.
“The rate cut advantages everything,” said Brian Madden, chief investment officer at First Avenue Investment Counsel. In addition to gold stocks, he noted the TSX is heavily concentrated in rate-sensitive defensive sectors including utilities and telecommunications as well and financials, all of which are likely to continue performing well.
A handful of standout individual stocks have also lifted the index. Toronto-Dominion Bank and e-commerce provider Shopify Inc., in particular, have provided the two largest boosts to the gauge this year. Shares of TD Bank staged a sharp recovery this year after a series of scandals in 2024 led to restrictions on its expansion in the U.S. and executive changes.
Overall, Canada’s banks have held up better than expected in the face of tariffs and a macroeconomic slowdown. All but one of the Big Six banks came ahead of analyst expectations in the third quarter as the country’s largest lenders set less money aside for potentially bad loans.
Shopify, meanwhile, has climbed this year to briefly become the country’s most valuable stock on a combination of “blowout” quarterly results and general strength in the tech sector.
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Last modified: September 23, 2025