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TSX Closer: Index Rises as Financials, Healthcare Gain; Oil Retreats Despite Geopolitical Risks

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The S&P/TSX Composite Index edged higher on Friday as gains in financial and healthcare stocks outweighed weakness in battery metals, while investors assessed corporate earnings, easing oil prices and ongoing geopolitical and trade risks.

The index closed up 176.44 points, or 0.50%, at 35,369.10, with sectors trading in mixed dealings. Healthcare led gainers up 1.3%, followed by the financial sector, up 0.8%. Battery Metals Index led decliners, down 2.4%.

In commodities, gold was mostly steady on Friday, sticking above the $4,000 mark even as the dollar nudged higher. The precious metal for August delivery was last seen up $5.1, or 0.1%, at $4,055.30 per ounce.

Meanwhile, oil prices retreated from six-week highs early on Friday even as Middle East fighting continues, with Iran and the US continuing attacks and Houthi militants threatening shipping in the Red Sea.

West Texas Intermediate crude oil for September delivery closed down $2.88, or 3.1%, to $89.31 per barrel, while September Brent oil was last seen down $3.02, or 3.00%, to $97.67.

The longer oil prices remain elevated, the greater the squeeze on household budgets, TD Economics said in a note on Friday, adding that mortgage rates have already climbed to nearly 6.9%, a one-year high that will further strain affordability in the near term.

"WTI crude climbed by $10 per barrel from the end of last week to briefly above $93 before easing below $90 Friday morning. Marking another potential escalation, President Trump warned that the US would attack critical infrastructure if Iran targeted vessels," TD Economist Admir Kolaj.

In economic news, Statistics Canada reported Friday that the Industrial Product Price Index fell 1.4% month over month in June as a tentative US-Iran deal boosted prospects for shipping through the Strait of Hormuz and lowered energy prices.

Prices for energy and petroleum prices dropped 9.1% in June after a run of monthly gains this year.

In another finding released on Friday, the Ottawa-based agency said Canada's new housing price index declined for a fourth straight month in June, sliding 0.1%. The index measures changes in the selling prices of new residential homes and covers new single homes, semi-detached home and townhouses.

Meanwhile, investors continued to assess the potential economic fallout from escalating US-Canada trade tensions.

Some analysts see the announcement of a possible 50% US tariff on Canadian goods this week mainly as a pressure tactic to get Canada to the negotiating table on US terms and soon, but BMO Economics wrote in a note that it isn't as confident on this.

Chief Economist Douglas Porter said a 50% tariff would hit British Columbia, Quebec and Ontario the hardest. If maintained, the taxes could shave off 0.5% of national GDP, he estimated.

In corporate news, Canadian National Railway Company (CNR.TO) reported second-quarter adjusted net income of C$1.26 billion, or C$2.08 per share, up from C$1.17 billion, or C$1.87 per share, in the year-ago quarter. Total revenues for the quarter were C$4.75 billion, up from C$4.27 billion.

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TSX Closer: Index Closes Lower as Tech Slides Despite Oil Rally, Strong Retail Sales

The S&P/TSX Composite Index edged lower on Thursday as weakness in technology stocks offset gains in energy shares, with investors assessing stronger Canadian retail sales data, escalating Middle East tensions and the latest US trade measures against Canada.The index closed down 292.45 points, or 0.8%, at 35,192.66, with mixed sectors. Energy led gainers, up 2.2%, while Information Technology led decliners, down 2.7%.In commodities, gold prices retreated on Thursday, falling off a two-week high as the dollar and yields rose after the US reported a sharp drop in initial jobless claims for the last week.The precious metal for August delivery was last seen down $100.10, or 2.41%, to $4,051.80 per ounce. The US Labor Department on Thursday reported 187,000 fresh jobless claims last week, down from a revised 209,000 claims a week earlier and under expectations for 212,000 new claims, according to MarketWatch.Meanwhile, West Texas Intermediate (WTI) crude oil closed sharply higher on Thursday, rising for a fifth straight day as fighting between the US and Iran continued and Yemen's Houthi militants widened the Middle East conflict by attacking two tankers carrying Saudi oil in the Red Sea.WTI crude oil for September delivery was last seen up $5.36, or 6.2%, to settle at $92.19 per barrel, its highest level since June 4, while September Brent crude was last seen up $7.16, or 7.6%, at $101.23.Canadian May retail sales advanced 1.0%, in line with its advance estimate, driven primarily by higher receipts at gas stations. The preliminary reading for June points to a 0.4% increase, Statistics Canada data showed Thursday.Beyond the gas price increase, retail sales were solid in May, and a decent flash for June adds to the encouraging news, said Shelly Kaushik, senior economist at BMO."The economy seemed to be building momentum in Q2, although additional challenges -- more tariffs, extreme weather, and the renewed energy price shock -- await in the second half of the year," Kaushik wrote.All nine sectors were higher, led by sporting goods and hobby stores (+1.8%), general merchandise (+1.0%) and building materials (+0.9%). Nine of the 10 provinces posted higher sales, led by Saskatchewan (+2.9%). Nova Scotia was the lone outlier with a 0.8% drop driven by weaker sales at motor vehicle and parts dealers.Looking ahead, expanded household benefits will support incomes and spending in the second half of the year, but the recent rebound in gasoline prices will limit the extent of any pick-up in retail sales volumes, noted CIBC's senior economist Andrew Grantham.In currencies, Scotiabank said it is maintaining a medium-term bullish view on the Canadian dollar with an outlook that central bank policy will narrow US-Canada policy rate differentials.The CAD entered Q3 slightly recovering its 2% decline in Q2 versus the US dollar, wrote Scotiabank in a note. "The forecasted Fed easing is paired with 75bps of tightening from the Bank of Canada, leaving the BoC at 3.25% by the end of our forecast horizon," the report said.The analysts acknowledged that "sentiment and positioning" continue to give a bearish leaning on CAD, which is a "major vulnerability." Scotiabank recently adjusted its USD/CAD forecast with a Q4 2026 target at $1.37 and a Q4 2027 target at $1.33.Additionally, small business confidence rose to 58.3 points in July, about 8 points above June, but confidence among manufacturers continued to lag at 53.7 index points, the Canadian Federation of Independent Business (CFIB) reported Thursday.The manufacturing sector's confidence, which hasn't recovered since 2023, has been hit harder by tariffs than by either the 2008-09 recession or the pandemic, the CFIB reported. The sector is contending with higher shipping and receiving costs.Meanwhile, responding to the latest US trade measures, Prime Minister Mark Carney said ahead of a meeting with Canada's premiers that the government would do "whatever it takes" to defend Canadian businesses, workers and families."We are in a stronger position than we were when this trade war started 18 months ago," Carney said Thursday, according to a video of his remarks in Charlottetown, P.E.I.On Monday, the White House said it will hit a host of goods including Canadian alcohol, hockey equipment, and electronics with a 50% tariff starting next month.

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