Nasdaq Leads Market Rally as Investors Rotate Back Into AI and Growth Stocks
The Canadian Vanguard Stock Market Report – Thursday December 18, 2025 Edition
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The Toronto Market
The S&P/TSX Composite Index gained 190.83 points, or 0.61%, to close at 31,440.85. As of today, the TSX snapped a four-session losing streak, posting a solid advance. The index remained positive throughout the trading session and stayed well above the previous session’s close.
Today’s Toronto Market Statistics
On the TSX, advancing issues outnumbered declining issues by approximately two to one. There were 1,402 advancers and 621 decliners, resulting in an advancer-to-decliner ratio of about 2.25 to 1, with 135 issues unchanged.
There were 106 new 52-week highs and 33 new 52-week lows, compared with 86 new 52-week highs and 30 new 52-week lows recorded yesterday.
Total trading volume on the TSX reached 471,487,823 shares, down 6% from 502,071,845 shares traded in the previous session.
Toronto Market Wrap-Up Report
Canadian equities staged a broad-based rebound today, with the S&P/TSX Composite Index gaining 190.83 points, or 0.61%, to close at 31,440.85. The advance snapped a four-session losing streak, as the index remained firmly positive throughout the trading session and held well above the previous day’s close, signaling improving near-term sentiment.
Market leadership was driven by a strong recovery in the Technology sector, which rose 2.15% after four consecutive sessions of sharp declines fueled by concerns over elevated AI-related valuations. Technology emerged as the top-performing sector on the day, alongside Financials, which also posted solid gains. Basic Materials finished near the middle of the performance spectrum, while Telecommunications Services and Healthcare lagged. Notably, Healthcare saw a meaningful decline, suggesting investors may have rotated capital out of defensive positions and into higher-beta, growth-oriented sectors.
Market breadth was decisively constructive. Advancing issues outnumbered decliners by roughly two to one, with 1,402 stocks advancing versus 621 declining, producing an advancer-to-decliner ratio of approximately 2.25 to 1. An additional 135 issues finished unchanged, underscoring the broad participation behind the market’s rebound.
Momentum indicators also strengthened. The number of stocks reaching new 52-week highs increased to 106, while new 52-week lows remained relatively contained at 33. This compares with 86 new highs and 30 new lows recorded in the previous session, reflecting expanding upside leadership and improving investor confidence. Notably, two of Canada’s Big Six banks—Royal Bank of Canada (TSX: RY) and Toronto-Dominion Bank (TSX: TD)—reached new 52-week highs, reinforcing the constructive tone in the Financials sector.
Trading activity eased modestly, with total TSX volume declining 6% to approximately 471.5 million shares from 502.1 million shares in the prior session. Despite lighter turnover, the strength and breadth of the advance suggest the move was supported by genuine buying interest rather than short-covering alone.
On the individual stock front, Aritzia Inc. (TSX: ATZ) was among the day’s standout performers, rising 4.3%, or $4.71, to close at $114.96 on volume of approximately 789,000 shares. The stock benefited from a price target increase by a CIBC analyst, who maintained an Outperform rating. Aritzia operates within the Consumer Discretionary sector and continues to attract investor attention amid improving sentiment toward retail-related names. Other notable gainers included ATS Corp. (TSX: ATS), Shopify Inc. (TSX: SHOP), Cameco Corp. (TSX: CCO), and CAE Inc. (TSX: CAE), reflecting strength across industrial, technology, and energy-related segments.
Overall, today’s session marked a constructive shift in market tone, characterized by broad participation, sector rotation toward growth, and renewed leadership from both Technology and Financials—factors that may support further upside in the near term if momentum persists.
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The US Markets
U.S. equity markets closed higher across the board, with risk appetite returning after recent volatility. The Dow Jones Industrial Average added 65.88 points, or 0.14%, to finish at 47,951.85. The S&P 500 posted a stronger gain, rising 53.33 points, or 0.79%, to close at 6,774.76.
The technology-heavy Nasdaq Composite led the major indexes, advancing 313.04 points, or 1.38%, to end the session at 23,006.36. The Nasdaq’s outperformance suggests investors moved past near-term AI valuation concerns, with renewed buying interest in large-cap growth names.
Small-cap stocks also delivered a solid performance. The Russell 2000 index gained 15.57 points, or 0.62%, closing at 2,507.87. The index traded consistently above the prior session’s close throughout the day, indicating sustained demand for smaller-cap equities and improving risk sentiment.
U.S. Daily Market Wrap Report
U.S. equity markets finished the session higher, as investor sentiment improved and risk appetite returned following recent volatility. All major indexes closed in positive territory, led by a strong rebound in technology shares.
The Dow Jones Industrial Average added 65.88 points, or 0.14%, to close at 47,951.85. The S&P 500 posted a more robust advance, gaining 53.33 points, or 0.79%, to end the session at 6,774.76. The technology-heavy Nasdaq Composite outperformed, climbing 313.04 points, or 1.38%, to finish at 23,006.36, as investors moved past near-term AI valuation concerns.
Small-cap stocks also participated in the rally. The Russell 2000 rose 15.57 points, or 0.62%, to close at 2,507.87. The index traded consistently above the prior session’s close throughout the day, reflecting sustained buying interest and improving confidence in economically sensitive names.
Market internals supported the headline gains. On the New York Stock Exchange, advancing issues outnumbered decliners by a wide margin, with 2,900 advancers versus 1,530 decliners and 353 unchanged issues. This produced an advancer-to-decliner ratio of approximately 1.89 to 1, signaling broad-based participation. Momentum strengthened notably, as 216 stocks reached new 52-week highs, compared with 105 new lows, a sharp increase in highs from the prior session.
NASDAQ breadth was similarly constructive. Advancers exceeded decliners by roughly eight to five, with 2,951 advancing stocks and 1,793 declining, yielding an advancer-to-decliner ratio of approximately 1.64 to 1. Internal momentum showed signs of improvement, as new 52-week highs increased to 139 while new lows declined to 232, indicating a gradual stabilization in growth-oriented names.
Sector leadership was concentrated in Technology, where semiconductor manufacturers and data-driven infrastructure stocks dominated the list of top performers. Strength across chipmakers and hardware-related names reinforced confidence in longer-term AI and digital transformation themes. The Nasdaq’s outperformance reflected renewed institutional demand for large-cap growth stocks.
Trading activity was mixed. NYSE volume remained steady at approximately 5.29 billion shares, largely unchanged from the prior session, while NASDAQ volume declined 7.5% to 8.32 billion shares. The combination of lighter turnover and strong price performance suggests gains were driven by selective accumulation rather than speculative excess.
Overall, the session marked a constructive shift in market tone, characterized by broad participation, improving internal momentum, and renewed leadership from technology shares—factors that may support continued upside if macro and earnings conditions remain favorable.
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(c) This article is published by The Canadian Vanguard on December 18, 2025
