Equities Rally as U.S. Cancels Planned Tariffs on Eight European Nations
The Canadian Vanguard Stock Market Report – Thursday January 22, 2026 Edition.
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The Toronto Market
The S&P/TSX Composite Index advanced 151.17 points, or 0.46%, to close at 33,002.70. The index has now finished higher in eight of the past nine trading sessions. As the TSX is heavily weighted toward mining and resource companies, it tends to outperform during periods of strong demand for precious and industrial metals.
Thursday’s TSX Market Statistics
Market breadth on the TSX was notably strong, with advancing issues significantly outpacing decliners. A total of 1,464 stocks advanced compared to 707 that declined, producing a healthy advancer-to-decliner ratio of 2.07:1. An additional 140 issues finished unchanged, underscoring broad-based participation in the rally.
Momentum also strengthened, as the TSX posted 301 new 52-week highs versus just 19 new 52-week lows. This marked a meaningful improvement from the prior session, which recorded 183 new highs and 54 new lows, signaling improving investor confidence and upside leadership.
Trading activity remained solid despite a pullback in volume. Total TSX volume reached 462.5 million shares, down 15% from the previous day’s 542.0 million shares, suggesting continued accumulation rather than distribution.
Toronto Market Wrap-Up Report
The TSX extended its rebound on Thursday, following through on Wednesday’s sharp recovery and reinforcing short-term bullish momentum. Strong market breadth supported the move, with advancers outpacing decliners by more than 2-to-1, suggesting institutional participation rather than a purely short-covering rally. The sharp expansion in new 52-week highs further confirmed upside momentum across multiple groups.
From a price-action standpoint, the index remains firmly in an uptrend after successfully absorbing Tuesday’s pullback. Near-term momentum favors buyers as long as the TSX holds above the recent breakout zone, with upside continuation likely if volume stabilizes and breadth remains supportive.
Sector rotation continues to favor cyclicals. Basic Materials led for a second straight session, confirming relative strength and keeping the group in a leadership role. Traders continue to rotate into resource-linked names, benefiting from improving commodity demand and trend alignment. Telecommunications Services and Healthcare provided secondary strength, offering defensive balance alongside the cyclical bid.
Technology was the notable laggard and failed to participate in the rebound, reinforcing a short-term risk-off rotation within growth. Celestica Inc. underperformed sharply, dropping 6.55% to close at $400.29. The stock lost momentum after recent gains, and traders may view the $390–$400 zone as a near-term support area. A failure to hold this range could invite further consolidation or downside pressure.
Within Financials, performance was mixed, but Bank of Montreal (TSX: BMO) remained a leadership name. BMO broke to a fresh 52-week high, closing at $191.15 on above-average volume. The breakout above the prior $191 resistance level keeps momentum firmly positive, with traders likely watching the $188–$190 area as first support. As long as price holds above that zone, pullbacks may continue to attract buyers.
Bottom Line (Trader Takeaway):
Momentum remains constructive, with strong breadth and expanding leadership supporting the upside. Traders may continue to favor long setups in materials and select financials while remaining cautious toward technology until relative strength improves. A sustained hold above recent TSX support levels would keep the short-term trend biased higher, while any deterioration in breadth could signal consolidation ahead.
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The US Markets
U.S. equity markets posted broad-based gains, extending the rally that began in the previous session. The Dow Jones Industrial Average advanced 306.78 points, or 0.63%, to close at 49,384.01. The S&P 500 added 37.73 points, or 0.55%, finishing at 6,913.35, while the Nasdaq Composite outperformed, surging 211.20 points, or 0.91%, to end the session at 23,436.02.
The Russell 2000 rose 20.59 points, or 0.76%, closing at 2,718.77, marking another strong showing for small-cap stocks. All major U.S. indexes finished higher on the day, reflecting improving risk appetite across market capitalizations.
The advance represents a continuation of the upside momentum that began yesterday, following reports that President Trump indicated he would withdraw plans to impose tariffs on European partners that do not support his proposal regarding Greenland. The easing of tariff-related concerns helped support equities, particularly growth- and risk-sensitive segments of the market.
From a relative performance standpoint, the Russell 2000 had been the strongest performer among the major indexes during last week’s sessions, highlighting renewed interest in small-cap exposure. However, in today’s session, the Nasdaq slightly outpaced the Russell, reclaiming leadership as traders rotated back into growth-oriented names.
Takeaway:
Momentum remains constructive across U.S. equities, with leadership rotating between small caps and technology. Continued follow-through would support a bullish short-term bias, while traders will be watching for confirmation through volume and sustained relative strength in growth stocks.
U.S. Market Wrap-Up Report
The U.S. equity market extended its broad-based rally on Thursday, with all major indexes finishing higher. Telecommunications Services, Basic Materials, and Technology led the gains, while Financials and retail-related sectors also performed relatively well.
Market Internals
Market breadth remained constructive across both exchanges. On the NYSE, advancing issues outnumbered decliners by 1.65:1, with 1,724 advancers, 1,045 decliners, and 68 unchanged. The NYSE recorded 302 new 52-week highs versus 14 new lows, with total volume at 5.39 billion shares, slightly lower than yesterday’s 5.95 billion, suggesting steady accumulation rather than aggressive profit-taking.
On the NASDAQ, advancing stocks outpaced decliners by 2.17:1, with 3,278 advancers, 1,513 decliners, and 284 unchanged. The exchange posted 568 new 52-week highs and 82 new lows, while total volume was 9.29 billion shares, down just 1.4% from the previous session. Overall, these internals confirm that the market rally is supported by broad participation and momentum, with no signs of immediate internal weakness.
Commodities & Sector Notes
Gold prices remain elevated, reflecting ongoing strength across precious metals and industrial metals such as silver, copper, palladium, and platinum. This trending asset class presents an attractive opportunity for investors to participate in the momentum, while monitoring for potential reversals.
Mining Stocks
Leading mining names such as AEM, FNV, and WPM continued to rally, as highlighted in yesterday’s report. Investors should also watch Coeur Mining (CDE) and Hycroft Mining (HYMC) for follow-through potential.
Technology Highlights
- Tesla Inc. bullishly reclaimed its 50-day moving average for the first time since January 13. Shares are approaching an early buy trigger at $454.30.
- Oracle Corporation (ORCL) shows tentative recovery attempts but remains below its 200-day moving average. The stock requires substantial chart repair, and investors should exercise patience until it clears the 50-day line.
Investor Takeaway
Strong market breadth and an expanding number of new highs confirm the ongoing momentum in U.S. equities. Trend-following investors may consider riding the upside in leading sectors such as materials, telecommunications, and select technology, while maintaining discipline around lagging or under-repair names. The current market environment rewards participation in trending assets and sectors, but caution is warranted for stocks below key technical support.
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(c) This article is published by The Canadian Vanguard on January 22, 2026
