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Investing.com -- Canada’s main stock exchange gained on Friday, touching a fresh record high.
The S&P/TSX Composite index ended 314 or 1.07% higher at 29,768.36.
On Thursday, index rose by 0.5% to end at 29,453.53, surpassing a previous all-time peak logged on Monday.
The uptick came as investors digested interest rate reductions from the Bank of Canada and U.S. Federal Reserve on Wednesday, with analysts also predicting that more cuts could be on the way from both by the end of 2025.
Financials stocks, which account for roughly a third of the TSX’s weighting, increased by 0.5%, offsetting a decline in energy shares which was driven by a dip in oil prices.
U.S. stocks at highs
U.S. stocks were trading high close to record levels in the wake of the Federal Reserve’s first rate cut since December.
At 4.01 ET, The blue-chip Dow Jones Industrial Average was up 172 or 0.37%, S&P 500 was up 0.44% and tech-heavy Nasdaq Composite moved up 0.72%.
The blue-chip Dow Jones Industrial Average, the benchmark S&P 500 and tech-heavy Nasdaq Composite all posted fresh all-time closing highs on Thursday, as investors continued to digest the Fed’s rate reduction.
With those gains, the Dow and S&P 500 are both on track to finish the week 0.7% higher. The Nasdaq Composite has climbed 1.5%.
Fed cut boosts sentiment
Wall Street has drawn support from the Fed’s decision on Wednesday to cut its benchmark rate by 25 basis points to a range of 4.00% to 4.25%.
The policy shift, aimed at cushioning a cooling labor market, was accompanied by projections for two more quarter-point reductions this year and another in 2026.
Fed Chair Jerome Powell said the move was a “risk-management cut” and stressed that future easing would depend on incoming data.
He pointed to persistent inflation pressures and uneven economic signals, underscoring that the central bank would proceed cautiously rather than committing to an aggressive cutting cycle.
"[B]ulls [are] celebrating the fact that both fiscal and monetary policy are now in stimulus mode while the AI mania continues," analysts at Vital Knowledge said in a note.
Trump and Xi set to talk
On the political front, President Donald Trump and his Chinese counterpart Xi Jinping are set to talk over the phone later Friday, with a potential agreement to keep short-form video app TikTok operating in the U.S. likely to be discussed.
U.S. officials have said the deal will be at the top of the agenda when Trump and Xi hold their first known call in three months, according to Reuters. It could reportedly serve as a precursor to a possible in-person meeting between the two at a summit in South Korea later this year, which would come after months of heated negotiations over trade since Trump’s return to power in January.
For TikTok, which is owned by China’s ByteDance, an accord over the fate of its U.S. arm would settle what has been a continued source of uncertainty for the mega-popular platform.
FedEx impresses with quarterly results
In the corporate sector, shipping giant FedEx (NYSE:FDX) posted better-than-anticipated quarterly revenue and profit after the close Thursday, with its results bolstered by a drive to bring down costs, which helped to counterbalance soft international volumes following the end of a tariff exemption for certain low-value products sent directly to consumers.
Executives flagged that the end of the so-called "de minimis" exemption took a $150 million bite out of fiscal first-quarter revenue -- but a top-line figure of $22.24 billion was still above estimates of $21.66 billion. Adjusted profit of $912 million also surpassed projections.
Homebuilder Lennar, on the other hand, reported a 46% drop in fiscal third-quarter profit.
U.S. housing demand has been dented by inflation fears and it remains somewhat uncertain if the restart of a Fed policy easing cycle will put short-term downward pressure on mortgage costs.
Lennar has rolled out incentives like cost adjustments and mortgage rate buydowns to try to boost home demand, but these have also served to dent profit margins.
Crude slips
Oil prices dipped, but were on track for marginal weekly gains after the interest rate cut from the Federal Reserve, despite growing concerns over slowing U.S. demand.
At 06:51 ET, Brent futures dropped 0.1% to $67.39 a barrel, and U.S. West Texas Intermediate crude futures fell 0.3% to $63.36 a barrel.
Both benchmarks were on track to post small gains for a second straight week, with lower borrowing costs typically boosting demand for oil and push prices higher.
That said, this optimism has been partially offset by fears of cooling U.S. demand, especially as inventory data showed a sharp increase in distillate stockpiles.
Gold climbs
Gold prices advanced, remaining on track for their fifth consecutive weekly rise.
Spot gold moved 0.3% higher to $3,655.88 an ounce by 06:53 ET, after hitting an all-time peak of $3,707.40 on Wednesday. U.S. gold futures for December also gained 0.3% to $3,688.60.
The yellow metal fell in the previous two sessions as the U.S. dollar rebounded from over-three-year lows after Fed Chair Jerome Powell struck a cautious tone regarding future easing.
But the prospect of further Fed rate drawdowns in the coming months has lifted some of the appeal of bullion, a non-yielding asset that tends to perform well in a low interest rate environment.