Canadian equities start positive at 2026, as a resurgence in the precious metals complex provides a tailwind for the resource-heavy Toronto market. Following a brief year-end retreat, investors are returning to the "safe-haven" trade amid a weakening U.S. dollar and escalating geopolitical friction.
Index on Friday is up 170 points or 0.54% at 31,883.37. This follows a somber final session of 2025, where the S&P/TSX Composite fell 153.50 points to close at 31,712.76. Despite that late-December softness, the benchmark ended 2025 with a 28.2% annual gain, its strongest performance since 2009, outpacing the S&P 500’s 17% return.
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Metals Higher to Kick Off 2026
The primary catalyst for Friday’s pre-market bounce is a broad recovery in the materials sector. After a sharp "flush out" in the final week of December, gold and silver have resumed their upward trajectory.
XAU/USD: Spot gold jumped 1.4% to $4,370.41/oz, while U.S. Gold Futures rose 0.9% to $4,380.30. Bullion remains supported by expectations of further Federal Reserve rate cuts in 2026 and robust buying from emerging market central banks.
Silver Futures: Climbed 4.46% to $73.75, building on a 2025 rally that saw the metal surge nearly 150% due to data center and solar energy demand.
Platinum Futures: Skyrocketed 5.07% to $2,147.85, as supply constraints continue to pinch the market.
Analysts suggest that while profit-taking characterized the end of December, the fundamental drivers, geopolitical uncertainty and a dovish Fed tilt, remain firmly in place for the new year.
U.S. stocks mixed S&P 500 was up about 0.2% at 3:02 p.m. ET (20:02 GMT) in New York, while Nasdaq 100 fell 0.1%. Dow Jones Industrial Average added 0.7%, or 323 points.
Historically, the S&P 500 has often started the year with modest losses before rallying to double-digit gains, but the 2026 opening indicates a "risk-on" appetite as traders bet on a soft landing for the global economy.
Oil Under Pressure Amid Oversupply Fears In a stark contrast to the metals rally, the energy sector is starting 2026 on the defensive.
Brent Oil Futures: Slipped 0.95% to $60.28.
Crude Oil WTI Futures: Fell 1% to $56.84.
Bearish sentiment is being driven by a projected market surplus and a deepening rift within OPEC+. Tensions between Saudi Arabia and the UAE over operations in Yemen have cast a shadow over the upcoming OPEC+ virtual meeting on January 4. While geopolitical risks, including fresh drone strikes on Russian energy infrastructure and U.S. sanctions on Venezuelan tankers, provide intermittent support, they have so far failed to offset the reality of rising global inventories.
Looking Ahead As the TSX opens its first session of 2026, the focus will remain on the "tug-of-war" between a resurgent mining sector and a struggling energy complex. Market participants are also keeping a close eye on the U.S. dollar’s trajectory, as its continued weakness remains the secret sauce for the Canadian benchmark’s commodity-led outperformance.
