CANADA STOCKS-TSX kicks off 2026 with gains, though weekly losses loom

By Avinash P

Jan 2 (Reuters) - Canada's main equity index began 2026 on a positive note on Friday, supported by rebounding technology stocks, even as mining-linked shares declined in thin trading despite a recovery in precious metal prices.

The S&P/TSX Composite index .GSPTSE was up 0.2% at 31,768.73 points as of 10:21 a.m. ET.

A year-end pullback in precious metal prices and falling miners' shares have set up the Canadian benchmark for its worst weekly performance since mid-November. The index has fallen for four straight sessions and is down 0.6% this week.

However, the resource-heavy TSX ended 2025 with its best annual performance since 2009, closing almost 29% higher and beating major U.S. stock indexes. The materials sub-index doubled in value over the previous year, while the heavyweight financial sector provided additional support following robust earnings reports from Canada's "Big Six" banks.

On Friday, the technology sub-index .SPTTTK rose 1%, tracking a bounce-back in global tech stocks. But materials .GSPTTMT and gold stocks .SPTTGD fell 0.2% and 0.5%, respectively, limiting gains. GOL/

"As we think about global market drivers, AI will remain a dominant theme, but we see solid reasons why markets are going to broaden both within tech and beyond tech," said Angelo Kourkafas, senior global investment strategist at Edward Jones.

Fundamental drivers that propelled markets in 2025 remain intact for 2026, suggesting continued positive sentiment despite the absence of a typical year-end "Santa Clause rally," Kourkafas added.

The "Santa Claus rally" refers to historically strong stock-market gains in the last five trading days of the year and the first two in January.

On the macro front, S&P's global manufacturing PMI data showed Canada's manufacturing sector contracted for an 11th straight month in December.

In notable share moves, Capstone Copper CS.TO fell 3% after the miner said a union representing about half its workers at the Mantoverde copper and gold mine in Chile will launch a strike on Friday.

Denison Mines DML.TO shares jumped 11.4% after the uranium miner reported readiness to launch its flagship Phoenix ISR project.