Broader TSX gains, led by miners and banks and backed by a growing IPO pipeline, hint at a new phase for Canada’s market
Canada’s stock market is quietly setting the stage for a potentially powerful late‑cycle rally – and this time, it may not be all about Big Tech.
Canada’s main stock index has been breaking record highs, supported by a broadening rally that is pulling in sectors beyond the usual handful of megacap technology names, Reuters reported.
At the same time, TMX Group, which operates the Toronto Stock Exchange, is preparing for a meaningful pickup in new listings as equity markets regain their footing and deal activity accelerates heading into 2026, executives told Reuters.
The S&P/TSX composite index recently climbed to another record close, helped by gains in metal mining names and renewed optimism that equities can finish the year on a strong note.
Market breadth – a key signal for many technical and macro‑oriented investors – has been improving after a period when performance was dominated by a small cluster of high‑flying US tech stocks.
Sid Mokhtari, chief market technician for CIBC Capital Markets, told Reuters that a previously “challenging breadth environment” in the US is reversing, with wider participation in gains that could particularly benefit the TSX, given its tilt toward value‑oriented sectors such as energy and financials.
He said this broadening of returns is helping to support the case for a year‑end rally.
Looking ahead, a Reuters poll found the TSX is expected to reach further all‑time highs next year as trade uncertainty potentially eases and resource names benefit from booming AI‑related investment.
That backdrop aligns with the index’s structural tilt to cyclicals and commodities, particularly materials, energy and financials.
On the primary market side, TMX executives told Reuters they see a robust pipeline of companies preparing to tap public markets in the coming months, with the real acceleration expected into 2026.
Canadian IPO activity has lagged the US this year even as Wall Street enjoys its strongest issuance environment since 2021, but sentiment is starting to shift.
According to Reuters, a key catalyst has been the roughly $704m Toronto listing of Brookfield‑backed Rockpoint Gas Storage, which has lifted confidence that larger new issues can be priced and absorbed.
IPOs in the US have raised about US$30bn so far this year, up nearly 13 percent from 2023, based on LSEG data cited by Reuters, and that rebound south of the border is beginning to spill over into Canada.
TMX CEO John McKenzie told Reuters that “the US generally always leads the IPO market in terms of liquidity,” and that successful, well‑priced US deals are helping create similar conditions in Canada.
He said TMX is seeing transactions come to market and a “deep pipeline” of prospective listings building for later.
Sector‑wise, the latest leg of the rally has underscored the TSX’s long‑standing tilts.
Materials, including metal miners, have benefited as stronger expectations for US Federal Reserve rate cuts supported gold and copper prices, Reuters reported.
Technology and financials have also contributed to recent gains, while consumer discretionary has lagged.
