Canadian Equities Rebound as Energy Sector Leads Rally Despite Mixed Economic Signals

The Canadian market shook off early weakness to close higher on Wednesday, with energy stocks leading the charge despite emerging negative energy quotes from the broader economic data landscape. The S&P/TSX Composite Index gained 102.40 points, or 0.33%, settling at 31,151.68 around midday, recovering from an earlier dip that nearly pushed the benchmark into negative territory.

Energy Stocks Drive Market Recovery

The energy sector proved to be the standout performer, with the Energy Capped Index climbing close to 2%. A roster of oil and gas producers posted notable advances, including Tamarack Valley Energy, International Petroleum Corp., Kelt Exploration, Headwater Exploration, Paramount Resources, Arc Resources, Cenovus Energy, Athabasca Oil Corporation, Peyto Exploration, and Prairiesky Royalty, each gaining between 2% and 6%.

Healthcare and Industrials Follow Suit

Beyond energy, healthcare and industrials sectors demonstrated resilience. Curaleaf Holdings jumped more than 4% in healthcare trading, while industrial names including Finning International, Tfi International, AtkinsRealis, Canadian National Railway, Canadian Pacific Railway, Russel Metals, and Stantec advanced between 1.3% and 3%.

Banking Sector Mixed on Earnings

Financial stocks showed divergent movement tied to quarterly results. Royal Bank of Canada gained approximately 1.2%, buoyed by stronger-than-expected earnings with adjusted net income of $5.6 billion and EPS of $3.85, both representing 25% year-over-year growth. National Bank of Canada, however, drifted 1.4% lower despite reporting net income of $1,059 million for Q4—an 11% increase from the prior year—though diluted EPS declined slightly to $2.57 from $2.66.

Corporate Developments Support Select Stocks

CGI Inc. edged higher following its announcement to acquire Online Business Systems, an IT consulting operation headquartered in Winnipeg. Enbridge gained 0.3% after guiding toward the upper half of its $19.4 billion to $20.0 billion EBITDA range for the full year. TELUS Corporation climbed 2.3%, supported by updated medium-term guidance and enhanced capital allocation details, including fresh free cash flow growth targets.

Economic Data Strikes a Cautious Note

Underlying the market’s recovery lies a cautionary tale from the economic data front. S&P Global’s Canada Composite PMI slumped to 44.9 in November from 50.3 in October—the weakest reading in five months—signaling contraction across the services sector. Manufacturing slipped to 48.4 from 49.6, while services deteriorated more sharply, falling to 44.3 from 50.5. These negative energy quotes from the economy underscore the pressure surrounding monetary policy expectations, with investors now attuned to upcoming announcements from both the Bank of Canada and the Federal Reserve.