Canadian Stocks Edge Marginally Lower Amid Profit Taking

(RTTNews) - Canadian stocks posted incremental losses on Monday as investors resorted to profit taking from last week's record high levels even as traders increased their bets on rate cuts by the Canadian central bank at its upcoming meeting.

After opening just above previous session's record close, the benchmark S&P/TSX Composite Index fell to an intraday low of 28,893.86 within an hour. The index remained in negative territory for the rest of the day before closing at 29,027.73, down by 22.90 points (or 0.08%).

Last Friday, crossing the 29,000 level for the first time, the index settled at 29,050.63, which was also the eighth consecutive all-time high.

Last week, data revealed by Statistics Canada showed that the unemployment rate has increased 0.2 percentage points to 7.1% in August, the highest level in four years and above market expectations of 7%.

The number of unemployed people increased to about 1.595 million. Youth unemployment remained elevated at 14.5%, largely due to slow hiring for seasonal summer jobs.

As Canada had two back-to-back months of job losses, expectations have increased of a rate cut by Bank of Canada in their upcoming September meeting next week. Of note, since March, the BoC has kept rates steady at 2.75% at its last three meetings.

Similarly, investors are anticipating a rate cut by the US Federal Reserve after last Friday's US nonfarm payrolls report confirmed that the labor market in the US was deteriorating.

Effective August 1, the 35% tariffs imposed by US President Donald Trump on all Canadian exports into the US have come into effect. The whopping levies are already hurting the Canadian economy, with the autos, steel and aluminum industries being the most squeezed resulting in severe job losses.

Weeks before, a US federal appeals court had decreed Trump's tariffs as an "overreach of job position" and "illegal." Contesting this judgment in the US Supreme Court, Trump administration has requested a speedy trial of the matter.

The lower court judgment has come at a time when high-level Canadian officials are engaged in diplomatic talks with their US counterparts to strike a trade deal. The verdict has added confusion to the already complex tariff scenario.

Today, US Treasury Secretary admitted that if lower court judgment is upheld by the SC, the world's major economy would have to refund billion in tariffs, damaging the US Treasury heavily.

Canadian Prime Minister Mark Carney is working hard to bring back the derailed economy by stopping the country's reliance on the US for its exports as well as committing to more spending on defense, infrastructure, energy, and port projects. The PM has described his upcoming budget as both an "austerity and investment budget" but promised no cuts to healthcare and education.

Major sectors that gained in today's trading were Materials (1.31%), Healthcare (0.60%), Real Estate (0.14%), and Energy (0.03%).

Among the individual stocks, G Mining Ventures Corp (4.07%), Hudbay Minerals Inc (3.35%), Pan American Silver Corp (3.11%), Allied Properties REIT (2.94%), and Sienna Senior Living Inc (1.55%) were the prominent gainers.

Major sectors that lost in today's trading were Utilities (0.29%), Communication Services (0.77%), Consumer Staples (1.05%), and Industrials (1.12%).

Among the individual stocks, Tfi International Inc (1.76%), Boralex Inc (1.07%), BCE Inc (1.64%), Telus Corp (1.18%), and Alimentation Couche-Tard Inc (2.51%) were the notable losers.