TORONTO – Canadian and U.S. stock markets moved in opposite directions on Tuesday as large banks began to report earnings north of the border.
Brianne Gardner, senior wealth manager at Velocity Investment Partners at Raymond James Ltd., said the TSX’s decline was a “natural pause after we saw last week’s strong run.”
Gardner added that most sectors on Canada’s benchmark index moved lower, with basic materials leading the pullback while technology was a standout performer on the day.
Canadian investors also geared up for the start of bank earnings season with Scotiabank reporting a rise in profits that beat analyst expectations, gaining 2.8 per cent on the day.
“I think we’re seeing an uptick on capital market spending and investment banking from Scotia earnings as well, which is important to see … But I think all eyes will be certainly on the banks and what their outlook is going to be,” Gardner said.
Royal Bank of Canada and National Bank will report earnings on Wednesday, with Bank of Montreal, CIBC and Toronto-Dominion Bank expected to report Thursday.
The S&P/TSX composite index was down 52.50 points at 31,049.28.
In New York, the Dow Jones industrial average was up 185.13 points at 47,474.46. The S&P 500 index was up 16.74 points at 6,829.37, while the Nasdaq composite was up 137.75 points at 23,413.67.
The U.S. stock market held steady on Tuesday as both bond yields and bitcoin stabilized.
“I think rate markets are calmer after Monday’s jumping global yields. And with the Fed now in its quiet period, markets are largely settled on a high likelihood of that December rate cut,” Gardner said.
In the bond market, Treasury yields calmed following their jumps the day before. The 10-year yield edged down to 4.08 per cent from 4.09 per cent late Monday, while the two-year yield eased to 3.51 per cent from 3.54 per cent.
Higher yields can drag prices lower for all kinds of investments, and those seen as the most expensive can take the biggest hit.
Monday’s climb in Treasury yields came after the Bank of Japan hinted that it may raise interest rates there soon. But hopes are still high that the U.S. Federal Reserve will cut its main interest rate when it meets in Washington next week.
Going forward, Gardner said she is optimistic about the direction of the stock market.
“The big picture I see is really resilience … resilience is still the theme. As long as earnings and economic data co-operate, I think the market appears comfortable grinding higher into year-end,” she said.
However, Gardner added that she wouldn’t be surprised to see some short-term volatility “from a technical standpoint.”
The Canadian dollar traded for 71.50 cents US compared with 71.54 cents US on Monday.
The January crude oil contract was down 68 cents US at US$58.64 per barrel. The February gold contract was down US$54.00 at US$4,220.80 an ounce.
This report by The Canadian Press was first published Dec. 2, 2025.
— With files from The Associated Press.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD, TSX: BNS)
