TORONTO – Strength in the energy sector helped Canada’s main stock index finish slightly higher on Tuesday, while U.S. stock markets hit new records on hopes of lower borrowing costs.
Kevin Burkett, portfolio manager at Victoria-based Burkett Asset Management, said Canadian markets were reacting to headlines about potential deals in the energy sector.
“Here in Canada, our economy is so resource-focused. Having a bit of M&A drama is interesting in terms of starting to set a course for what commodities look like in the coming decade,” he said.
Teck Resources Ltd. shares finished 11.53 per cent higher after it agreed to a tie-up with London-headquartered Anglo American PLC to create a copper-focused giant worth about $70 billion.
However, Burkett added it will be interesting to see how Prime Minister Mark Carney directs his cabinet to evaluate the deal, since it will be subject to a review under the Investment Canada Act, which can be used to block deals deemed not in the national interest.
Burkett also noted Canadian investors were digesting news from the previous day of Strathcona Resources Ltd. revising its takeover bid for MEG Energy Corp.
He said the benefits of scale are becoming a key theme in the resources sector as “these large companies want to combine and get larger to be more efficient.”
The S&P/TSX composite index was up 35.28 points at 29,063.01.
In New York, the Dow Jones industrial average was up 196.39 points at 45,711.34. The S&P 500 index was up 17.46 points at 6,512.61, while the Nasdaq composite was up 80.79 points at 21,879.49. They all set new highs.
U.S. stocks rose to more records on Tuesday after the latest update on the U.S. job market bolstered Wall Street’s hopes for a slowdown that’s deep enough to get the U.S. Federal Reserve to cut interest rates, but not so overwhelming that it causes a recession.
Traders have become convinced that the Fed will cut its main interest rate for the first time this year at its next meeting in a week to prop up the slowing job market.
A report on Tuesday offered the latest signal of weakness, when the U.S. government said its prior count of jobs across the country through March may have been too high by 911,000, or 0.6 per cent.
“In the U.S., rates had been stubbornly high. This was part of what was drawing Trump’s ire. So Trump is looking at the labour statistics revision and saying, ‘Well, the economy is weaker than all the economists had been telling us. So I’m right, we should have been cutting rates,’” Burkett said.
“In the short term, that’s a good news story for markets because rates move lower and that tends to send equity prices higher.”
The Canadian dollar traded for 72.29 cents US compared with 72.38 cents US on Monday.
The October crude oil contract was up 37 cents US at US$62.63 per barrel.
The December gold contract was up US$4.80 at US$3,682.20 an ounce.
This report by The Canadian Press was first published Sept. 9, 2025.
— With files from The Associated Press.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD)
