Canadian Stocks Slip As Investors Parse Canada, US Data Releases

(RTTNews) - Canadian stocks ticked lower on Monday as investors analyzed the domestic Purchasing Managers' Index indicating a shrinkage in the services sector, surveys on business outlook and consumer expectations, and the U.S. nonfarm payrolls data.

After opening below yesterday's close, today the benchmark S&P/TSX Composite Index soon lost the momentum and traded negatively throughout the rest of the session before settling at 35,212.32, down by 62.52 points (or 0.18%).

Only three of the 11 sectors posted gains today, with the financials sector leading the pack.

Last week, Canada's TSX Composite Index posted gains from Tuesday through Friday with the market remaining closed on Wednesday on account of Canada Day Holiday.

Today, some of the traders opted to book profits from the gains made over these sessions.

On the economic data front, Canada's S&P Global Services Purchasing Managers' Index fell to 47.10 in June from 50.60 in May, signalling a contraction (i.e., a reading below 50.00) in the services sector.

Due to the geopolitical uncertainty, new orders fell for the second straight month signalling weak business activity.

The Business Outlook Survey conducted in May by the Bank of Canada for Q2 2026 reflected the expected rising price expectations but stable longer-run (5-year) inflation expectations among businesses.

The separate Canadian Survey on Consumer Expectations showed energy prices cutting into household spending plans in Q2 2026, more significantly.

On the trade front, investors are awaiting the Canadian government's response following the refusal of the U.S. government to renew the high-stakes Canada-United States-Mexico Agreement for free trade.

The U.S. decision has mandated a renewable annual review of the agreement for over a 10-year period. However, how these annual reviews will be conducted exactly is yet to be determined.

On Friday, the Canada-U.S. Trade Minister Dominic LeBlanc stated that significant uncertainty remains over the next steps in the Canada-U.S. trade negotiations.

After announcing the interest rates in June, the economic projections by the U.S. Federal Reserve revealed that many of the policymakers were speculating a rate hike sometime this year while a few forecasted an interest hike in the next meeting.

However, the U.S. nonfarm payrolls data released on Thursday showing an easing labor market, lowered the expectations of an immediate rate hike.

The economy added 57,000 jobs in June, far below a downwardly revised 129,000 in May and forecasts of 110,000.

In the Middle East, the reopening of the Strait of Hormuz led to a steady improvement in the shipping traffic.

Sailors are cautiously moving to their respective destinations after two separate incidents of unknown projectile hits involving a a Singapore-flagged vessel and a Panama-flagged ship.

While Iran continues to assert its leadership over the strait, the U.S. leaders repeated that the waterway would be free for all international ships after a deal is reached.

Over this weekend, Al Jazeera quoted Iran's Ambassador to China Abdolreza Rahmani Fazil as stating that since the Strait of Hormuz is a part of Iran's territorial waters, Iran intends to charge a fee in some form though not necessarily as tolls.

Yesterday, U.S. President Donald Trump warned Iran to strike a deal soon or face military action.

The prevailing uncertainty on how the U.S.-Iran conflict would end refrained investors from making big moves.

Major sectors that gained in today's trading were Financials (1.08%), Industrials (0.51%), and IT (0.11%).

Among the individual stocks, Power Corporation of Canada (2.05%), Onex Corporation (1.86%), Bombardier Inc (6.07%), Brookfield Business Corporation (4.14%), Hammond Power Solutions Inc (4.05%), and Linamar Corp (3.74%) were the prominent gainers.

Major sectors that lost in today's trading were Consumer Staples (0.70%), Utilities (0.82%), Energy (1.18%), Healthcare (2.21%), and Materials (2.22%).

Among the individual stocks, I 80 Gold Corp (7.14%), Pan American Silver Corp (5.76%), Discovery Silver Corp (5.72%), Curaleaf Holdings Inc (9.08%), and Headwater Exploration Inc (3.69%) were the notable losers.