Boosted by a robust rally in mining stocks, the Canadian equity market closed higher overall today. Among all eleven sectors, six posted gains, with the materials sector particularly standing out and leading the advance.
Recent international geopolitical events have captured market attention. After months of airstrikes and a maritime blockade, U.S. authorities arrested Venezuelan President Nicolás Maduro and his spouse over the weekend, extraditing them to the United States to face multiple charges, all of which they deny. U.S. President Donald Trump declared the operation a success, stating that the U.S. would take control of Venezuela’s oil industry and encouraging American oil companies to rebuild the country’s aging oil infrastructure. Analysts note that this process is expected to take approximately a decade, require massive investment, and will not be straightforward. Given that Venezuela holds about 303 billion barrels of proven oil reserves, nearly 17% of the global total, the U.S. gaining access to its heavy crude resources has raised market concerns about the potential erosion of future U.S. market share for Canadian oil exporters. In response, the Canadian side has emphasized its commitment to making its oil both “low-carbon” and “competitive.”
Meanwhile, the latest economic data shows that the S&P Global Composite Purchasing Managers’ Index (PMI) for December 2025 came in at 46.7. Although this marks an improvement from the previous month, it remains below the 50 threshold that separates expansion from contraction for the second consecutive month, indicating a further slowdown in business activity due to persistently shrinking new orders, with weakness in new export business being particularly pronounced.
On the monetary policy front, the market currently sees a low probability of the Federal Reserve cutting interest rates at its meeting later this month. After four consecutive 25-basis-point rate cuts, the Bank of Canada has lowered its policy rate to 2.25% and has signaled that the current level is “roughly appropriate,” which is largely seen as having met the anticipated goal of policy easing.
Investor attention is also focused on the upcoming review of the Canada-United States-Mexico Agreement (CUSMA). The agreement provides crucial trade access for Canadian exporters to circumvent potential tariff threats. Previously, President Trump’s remarks about possibly revising or even withdrawing from the pact had caused widespread concern among Canadian market participants.
During today’s session, the materials sector rose by 3.12%, the information technology sector gained 2.14%, while the consumer discretionary and industrial sectors increased by 1.62% and 1.02%, respectively. Among individual stocks, First Majestic Silver Corp. surged 10.06%, Endeavour Silver Corp. advanced 8.38%, and shares of companies such as Perpetua Resources Corp., Aya Gold & Silver Inc., Celestica Inc., and Aritzia Inc. also posted significant gains.
