Canada's primary stock market, the S&P/TSX Composite Index, opened the trading year 2026 on a positive note this Friday, January 2. The index closed higher, shrugging off disappointing domestic manufacturing figures, as a significant rally in uranium and energy stocks provided the necessary thrust.
Market Performance and Key Drivers
The TSX composite index concluded the session at 31,883.37, marking a solid gain of 170.61 points or 0.5%. This upward move helped the index rebound after it had recorded losses in the previous four consecutive trading sessions. For the first week of the new year, however, the index registered a minor weekly decline of 0.4%.
This positive start follows an exceptionally strong performance in 2025, where the TSX posted an impressive annual gain of 28.25%. This was its most substantial yearly advance in 16 years, fueled by soaring gold prices, reduced borrowing costs, and widespread optimism in the technology sector, which collectively counterbalanced economic challenges.
Sectoral Movement: Energy Soars, Tech Stumbles
The day's trading was marked by clear sectoral divergences. The energy sector led the gainers, climbing 1.8%. This rise occurred even as the global oil benchmark, crude oil, settled marginally lower by 0.2% at $57.32 per barrel. The real spark within the energy complex came from uranium miners.
Shares of Denison Mines skyrocketed by 13.7% after the company announced it was prepared to launch its flagship Phoenix ISR uranium project. Peer company Energy Fuels also saw a massive surge of 15.4%. Other sectors that contributed to the gains included industrials, which added 0.7%, and the heavyweight financials sector, which rose 0.6%. The materials group, which encompasses precious and base metal miners, edged up 0.2%, supported by firmer gold prices.
On the losing side, the technology sector was a notable laggard, falling 1%. It was one of only two major sectors to end the day in negative territory. This pullback occurred despite long-term bullish sentiments around artificial intelligence (AI) as a dominant market theme. Angelo Kourkafas, senior global investment strategist at Edward Jones, noted, "AI will remain a dominant theme, but we see solid reasons why markets are going to broaden both within tech and beyond tech."
Economic Backdrop and Global Factors
The market's resilience was tested by weak economic data. A report showed that Canada's manufacturing sector remained in contraction territory for the 11th straight month in December. The decline was attributed to heightened trade uncertainty, which led to a steeper fall in both production output and new orders.
Globally, supply-side concerns emerged in the mining sector. Hundreds of workers initiated a strike at Capstone Copper's Mantoverde copper and gold mine in Chile after labour contract negotiations collapsed. This development weighed on Capstone's shares, which fell 1.5% on the TSX.
In summary, the TSX's first trading day of 2026 demonstrated a market selectively focusing on commodity-driven narratives, particularly uranium, while digesting mixed signals from the broader economy and the technology sector.
