Taylor explains that the vast majority of positive performance on the TSX can be ascribed to the financials sector, gold stocks, and Shopify. Gold companies were buoyed by both an incredibly positive run up in the price of gold and the subsequent influx of investor interest towards gold mining names on the TSX. Financials have also benefitted from the rate cutting cycle and steepening yield curve with respect to net interest margins. The overhang that banks might be too exposed to a weakening consumer was also lifted with banks reporting lower loan loss provisions than analysts anticipated.
Outside of those sectors, as well as the company-specific factors driving Shopify higher, Taylor notes that most of the TSX has underperformed. Transportation companies, especially the railways, did quite poorly so far this year. Many Canadian software names have been impacted by the expectation that generative…
