TSX gains while Canadian retail sales slips

Investing.com - Canada’s main stock index was trading higher on Friday after closing sharply lower in the previous session while Canada’s retail sector posted a modest retreat in September,

Toronto Stock Exchange’s S&P/TSX Composite gained 0.84% at 30,160.48.

Index closed Thursday 1.2%, or 371 points, lower at 29,906.55, with falling stocks outnumbered advancing ones by 713 to 209 and 62 ending unchanged.

Sentiment remains fragile

Sentiment has been hit by U.S. data showing stronger-than-expected job growth for September, meaning investors have further priced out the likelihood of a quarter-point rate cut by the U.S. Federal Reserve next month. 

This overturned the earlier confidence generated by strong third-quarter results and upbeat guidance from Nvidia (NASDAQ:NVDA), the most valuable company in the world and the poster child for the massive growth generated by artificial intelligence spending. 

Worries over the extreme spending on artificial intelligence capabilities, and the associated gains in market capitalization, by a number of tech giants have pressured stock markets across the globe for large parts of this month.

Canadian retail sales slips 

Canada’s retail sector posted a modest retreat in September, according to data released Friday by Statistics Canada, signaling a broader cooling in consumer activity heading into the final quarter of 2025. Retail sales declined 0.7% to $69.8 billion for the month, with volume sales down 0.8%, underscoring softness in real purchasing power as inflation-adjusted figures also turned negative.

Motor vehicle and parts dealers were the main drag, falling 2.9%, their first decline after two monthly gains, as new vehicle sales tumbled 3.6%. In contrast, gasoline stations and fuel vendors recorded a 1.9% sales uptick, though volumes still fell 1.0%, reflecting higher pump prices rather than increased consumption.

Core retail sales, which strip out volatile components such as autos and fuel, were largely flat after rising 1.1% in August. Gains in food and beverage retailers, including a 3.4% surge from beer, wine and liquor vendors, were outweighed by drops at building material and garden suppliers and general merchandise stores.

Regionally, six of ten provinces experienced sales downturns, with Ontario leading in both magnitude and impact. The province saw a 1.2% dip in September, driven chiefly by sagging auto sales, while Toronto’s retail activity shrank by 2.3%, continuing a sluggish trend in Canada’s largest metropolitan market.

Gold prices on track for losing week

Gold prices fell as easing bets on a December interest rate cut by the Federal Reserve buoyed the dollar and weighed on commodity prices across the board. 

Spot gold fell 1% to $4,036.70 an ounce, while gold futures for December fell 0.6% to $4,034.54/oz. 

Spot prices were trading down over 1% this week, reversing a 2% spike from the prior week.

Oil prices also fell Friday, adding to recent losses as traders digested a potential Russia-Ukraine peace deal that could swell global market supply.

Brent futures dropped 2.2% to $61.99 a barrel, and U.S. West Texas Intermediate crude futures fell 2.5% to $57.49 a barrel.

Both contracts are on track to post weekly losses of around 4%, erasing most of last week’s gains.

Market sentiment turned bearish as Washington pushed for a peace plan between Ukraine and Russia to end the three-year war, which, if accepted, would remove much of the war’s geopolitical risk premium baked into crude.