TSX scales record high as Trump taps Bessent as Treasury Secretary

11:43 am Monday, November 25th, 2024

By Nikhil Sharma

(Reuters) -Canada’s main stock index hit a record high on Monday, helped by real estate stocks, after President-elect Donald Trump’s nomination of hedge fund manager Scott Bessent as U.S. Treasury Secretary buoyed investor sentiment globally.

The S&P/TSX composite index was up 60 points, or 0.24%, at 25,504.28, and was set for its third straight session of record-high closing.

The biggest driver for overall gains was Wall Street, where the benchmark S&P 500 gained 0.7%. [.N]

Markets cheered Bessent’s nomination as investors expect the fiscal hawk to control U.S. debt levels, while also delivering on Trump’s pledges of tax and spending cuts.

“Generally, I think that people are seeing him as favorable towards equity markets,” said Colin Cieszynski, chief market strategist at SIA Wealth Management.

Investors also expect Bessent to adopt a lighter approach towards tariffs, unlike Trump’s aggressive proposed measures that include 10% tariffs on goods imported from all other countries.

Cieszynski noted the United States is Canada’s biggest trading partner and “if there’s any sense that they may not be as tough on tariffs as people think, then that’s a positive for Canada.”

Canadian 10-year benchmark yield fell as much as 11 basis points, mimicking a decline in its U.S. counterpart, which lifted rate-sensitive real estate sector 1.6%.

Yields on Treasury bonds had surged after Trump’s victory on expectations that his policies, seen as favorable to corporates, could fuel inflationary pressures and obstruct the Federal Reserve’s path to lower interest rates.

The materials sector was the biggest drag, losing 3.2% as gold prices fell more than 2% on profit-booking after the previous week’s rally. Bessent’s nomination also tempered safe-haven buying. [GOL/]

Among individual stocks, CI Financial climbed 30% after Abu Dhabi’s Mubadala Capital announced it would take the Canadian asset and wealth manager private in a C$12.1 billion ($8.66 billion) all-cash deal, including debt.

(Reporting by Nikhil Sharma in Bengaluru; Editing by Shreya Biswas)