Canadian Stocks Move Lower As Traders Exercise Caution Ahead Of New Year

(RTTNews) - Canadian stocks edged lower on Monday as markets reopen after Christmas and weekend holidays amid several geopolitical conflicts, forcing investors to take measured steps on the last week of this year.

After opening below the previous week's close, today the benchmark S&P/TSX Composite Index traded firmly negative throughout the session before settling at 31,896.59, down by 103.17 points (or 0.32%).

Seven of the 11 sectors posted gains today, with the communication services sector leading the pack.

In his ongoing efforts to end the Russia-Ukraine war, U.S. President Donald Trump had a lengthy telephonic conversation with Russian President Vladimir Putin which he termed was "productive".

Following the call, Trump hosted Ukrainian President Volodymyr Zelenskyy at his Mar-a-Lago residence in Florida to understand Ukraine's concerns and demands.

After the discussion, Trump hinted that they are getting close to a peace deal and Zelenskyy too commented that the talks were "progressive".

However, the ceasefire optimism was eclipsed by intense mutual attacks between Russia and Ukraine on each other's energy infrastructures.

Prior to the meeting with Trump, Zelenskyy had a telephone call with Prime Minister Mark Carney on Friday and visited Canada on Saturday.

The Canadian PMO later announced that Carney's government will provide $2.5 billion in economic assistance for Ukraine. Of note, since 2022, Canada has provided around $22 billion to aid Ukraine.

Reportedly, Carney's gesture has not been welcomed by Canadians, who are already facing the effects of Trump's tariffs.

Since August, Canadian exports to the U.S. have been slapped with 35% levies by Trump.

Even as Canada was negotiating with their U.S. counterparts to arrive at a mutually favorable deal, Trump abruptly halted all trade talks with Canada.

Now, business houses are expecting Carney to influence Trump to favor Canada during the upcoming negotiations for the Canada-United States-Mexico Agreement (CUSMA), a free-trade pact, which is up for renewal next year.

A majority of Canadian exports to the U.S. are now shipped through CUSMA and escape the 35% tariff though steel, aluminum, automobile, and softwood lumber industries are still feeling the heat.

Two-thirds of Canada's economy constitutes trade and roughly three-quarters of its exports are to the U.S.

The summary of Bank of Canada's council deliberations released last week showed that policymakers of the central bank have unilaterally agreed that uncertainty surrounding the CUSMA review could impact business investments and is a major source of risk to the economic outlook.

With no reports released today on the economic data front, investors are anticipating the minutes of the U.S. Federal Reserve's December meeting, scheduled to be released tomorrow, to get a glimpse of the Fed's policy outlook and clues on its interest rate trajectory.

With gold prices falling on profit-taking from recent record highs, mining stocks came under pressure, weighing down on the index.

Major sectors that gained in today's trading were Communication Services (1.13%), Energy (1.01%), Consumer Staples (0.54%), and Real Estate (0.39%).

Among the individual stocks, BCE Inc (1.84%), Telus Corp (1.54%), Terravest Capital Inc (3.35%), and Jamieson Wellness Inc (1.71%) were the prominent gainers.

Major sectors that lost in today's trading were Consumer Discretionary (0.19%), IT (0.46%), Healthcare (1.50%), and Materials (2.88%).

Among the individual stocks, Perpetua Resources Corp (6.88%), Orla Mining Ltd (5.64%), Agnico Eagle Mines Ltd (5.25%), and Curaleaf Holdings Inc (6.38%) were the notable losers.

Teck Resources Ltd (2.56%) and Peyto Exploration and Development Corp (1.89%) were among the prime market-moving stocks today.