04:23 PM EST, 12/23/2024 (MT Newswires) -- The Toronto Stock Exchange has built on the 185 points that had been regained on Friday, following a week of losses, in rising another 149.5 points on Monday to close out at 24,748.98, buoyed by confirmation that the Bank of Canada is headed down a gradual rate cut path and more 'outsize' moves are unlikely.

There was broad based buying today, with most sectors higher, led by Health Care and the Battery Metals Index both up by more than 3%. Both Energy and Base Metals were higher too, despite lower commodity prices.

Telecoms, down near 7%, was the sole decliner. On that sector, Canada's antitrust regulator said on Monday it was suing Rogers Communications Inc (RCI-A.TO, RCI-B.TO), for allegedly misleading consumers about offering unlimited data under some phone plans.

On the economics front here, Tiago Figueiredo over at Desjardins in a 'Quick Take' on the Bank of Canada's Summary of Deliberations released early on Monday afternoon noted Canadian central bankers agreed to cut rates by 50 basis points in December, but that decision was a close one.

Figueiredo noted with Canadian economic data mixed during the inter-meeting period, governing council "saw some scope" for a 25 basis point rate cut on account of a rebound in per capita spending and housing activity. But, he said, many factors led policymakers to ultimately reduce the overnight rate by 50 basis points. The key drivers being weak business investment, the threat of tariffs and growing slack in the labour market, he added.

Going forward, Figueiredo noted, central bankers agreed the pace of easing would be more gradual. Officials pointed to the depreciation in the Canadian dollar, noting that although most of the move had been driven by a stronger US dollar, the divergence between U.S. and Canadian monetary policy likely had an impact. Going forward, Desjardins continues to expect Canadian central bankers to cut rates by another 25 basis points in January and then pause in March to assess how the economy responds to lower interest rates.

But Canadian GDP data published earlier today was symbolic of sentiment here, showing a gain in October, but momentum fading in November.

Canadian GDP expanded 0.3% in October following a revised 0.2% increase in September (upgraded from an initial reading of 0.08% to 0.24%). October's growth exceeded Statistics Canada's preliminary estimate of 0.1%. The advance estimate pointed to a 0.1% contraction in November. RBC said these preliminary figures are typically subject to significant revision, but the pullback in November is consistent with softer looking wholesale and manufacturing sale advance estimates for the month, and a pullback in consumer spending in RBC's own tracking of card transactions. At current trajectory, RBC added, Q4 GDP growth appears to be tracking closer to, but still slightly below, the Bank of Canada's 2% forecast.

For RBC, the bottom line is that today's GDP report shows Canadian economic growth accelerated in October from September. However, the early estimate points to a contraction (-0.1%) in November, consistent with preliminary reports showing softer wholesale sales, declining manufacturing volumes, and flat retail sales. RBC noted the Bank of Canada's December messaging pointed to a more gradual approach on rate cuts going forward than the 50 bp reductions in each of October and December, but RBC continues to expect that interest rate cuts down to a net stimulative 2% overnight rate (below the BoC's estimated neutral range of 2.25% to 3.25%) will be warranted to allow economic growth to strengthen and prevent inflation from falling significantly below the central bank's 2% target.

Monday's gains on the resources heavy TSX may have been capped on weak commodity prices, although there were winners like Vermilion Energy ( VET ) , which rose 0.3% and kept an Outperform rating and had its target raised to C$18 from $17.50 at National Bank after announcing the acquisition of Westbrick Energy Ltd., a privately held oil and gas company operating in the Deep Basin, for total proceeds of near $1.1 billion.

MarketWatch noted oil futures ended modestly lower Monday, "extending a decline seen the previous week in response to a surging U.S. dollar and worries about the outlook for demand -- particularly from China, the world's largest crude importer".

It noted West Texas Intermediate crude for February delivery fell 22 cents, or 0.3%, to end at $69.24 a barrel on the New York Mercantile Exchange. February Brent crude, the global benchmark, settled at $72.63 a barrel on ICE Futures Europe, down 31 cents, or 0.4%.

Elsewhere, Comex gold settled 0.6% lower at US$2,612.30 and is down in all but one of the last eight sessions. Silver was up 0.8%, a second straight gain.

RBC Capital Markets noted for the week ending December 20, gold decreased 1.0% to $2,622/oz and physical gold ETFs recorded outflows of 293koz. It also noted silver decreased 3.4% to $29.52/oz, and physical silver ETFs recorded outflows of 11moz. CFTC net long gold positions decreased by 16k contracts to 261k, and net long silver positions decreased by 2k contracts to 36k contracts.

Gold equities, RBC also noted, decreased by 4.5% while gold equity ETFs recorded weekly outflows of $18m. Larger weekly equity price changes for companies under coverage relative to the index included Australia's Bellevue Gold (-15.3%), Seabridge Gold ( SA ) (-10.8%), Coeur Mining (-10.4%), and Silvercrest Resources (SIL.TO) (-10.3%). Short position data was reported for Canada, with a notable fall in Wesdome Gold (WDO.TO).

Meanwhile, The Wall Street Journal noted U.S. natural-gas futures snapped a four-session winning streak in volatile trade after hitting a two-year high $3.944/mmBtu overnight.

MarketWatch noted January gasoline declined 0.2% to finish at $1.9383 a gallon, while January heating oil lost 0.2% to $2.2263 a gallon. January natural gas dropped 2.5% to end at $3.656 per million British thermal units.