Strong Earnings Propel Major Indexes to Record Highs as Semiconductor Stocks Roar Back
The Canadian Vanguard Stock Market Report Tuesday August 4, 2026 Edition
.
The Toronto Market
Tuesday’s Toronto Market Index
The S&P/TSX Composite Index staged a powerful rebound on Tuesday, advancing 575.45 points (1.63%) to close at 35,801.59. The market opened with a strong upside gap above Friday’s close and sustained buying interest throughout the session. Unlike Friday’s broad-based weakness, when the index remained under pressure for the entire trading day, Tuesday’s session was characterized by steady and persistent gains with very limited intraday retracement. The market closed near its session high, reflecting continued institutional buying and strong investor confidence into the close.
Tuesday’s price action significantly strengthened the TSX’s technical outlook. The successful upside gap at the open, followed by a steady advance throughout the day, signals strong bullish momentum and confirms that buyers have regained control of the market. The index is now trading decisively above its 25-day, 50-day, and 200-day moving averages, reinforcing the positive short-, intermediate-, and long-term trend structure. Moreover, the ability to sustain gains throughout the session without meaningful selling pressure suggests that market breadth and buying participation were broadly supportive of the advance. The close near the day’s high is another constructive technical signal, indicating that demand remained strong through the final hour of trading.
The intermediate-term outlook for the TSX remains favourable. Tuesday’s strong recovery has restored bullish momentum and increases the likelihood of further upside in the near term, provided the index continues to hold above its key moving averages. While the magnitude of the rally may invite some short-term profit-taking or consolidation over the next few sessions, any pullback that remains above key technical support levels would likely be viewed as a healthy pause within the broader uptrend rather than the beginning of a reversal. Overall, the technical landscape continues to favour the bulls, with momentum indicators suggesting that the path of least resistance remains to the upside.
Tuesday’s TSX Market Statistics
Market Breadth
Market breadth improved significantly on Tuesday, reflecting broad-based buying across the TSX. Advancing issues outnumbered declining issues by a wide margin, with 1,751 advancers versus 566 decliners, while 91 issues closed unchanged. This produced a robust advancer-to-decliner ratio of 3.09:1, meaning that approximately three stocks advanced for every one that declined. Such a strong breadth reading confirms that Tuesday’s rally was broad-based rather than being driven by only a handful of large-cap stocks.
New Highs and New Lows
The internal strength of the market improved markedly. The TSX recorded 264 new 52-week highs compared with just 33 new 52-week lows, a dramatic improvement from Friday’s figures of 44 new highs and 87 new lows. As a result, the new high-to-new low ratio strengthened from 1:2 on Friday to approximately 8:1 on Tuesday. This sharp expansion in new highs, coupled with the significant contraction in new lows, is a constructive technical development that points to improving market participation and confirms the strength of the current advance.
Trading Activity
Trading activity also increased, reflecting stronger investor participation. Total TSX volume reached 571.1 million shares, representing an increase of approximately 10% from Friday’s volume of 520.0 million shares. The combination of rising prices, expanding market breadth, and higher trading volume provides additional confirmation that Tuesday’s rally was supported by genuine buying interest rather than light-volume trading. From a technical perspective, this represents a healthy accumulation day and reinforces the positive near-term outlook for the Canadian equity market.
.
Tuesday’s Toronto TSX Market Wrap-Up Report
Market Summary
The S&P/TSX Composite Index delivered a strong rebound on Tuesday, rising 575.45 points (1.63%) to close at 35,801.59. The market opened with a bullish gap above Friday’s close and maintained steady buying momentum throughout the session, finishing near the day’s high. The orderly advance, with only minor intraday pullbacks, reflected broad-based institutional buying and renewed investor confidence following Friday’s weakness.
The rally was supported by improving market internals. Advancing issues outnumbered declining issues by 1,751 to 566, producing a healthy 3.09-to-1 advancer-to-decliner ratio. Market leadership also broadened considerably, with 264 new 52-week highs against only 33 new lows, an impressive 8-to-1 ratio, compared with 1-to-2 in the previous session. Trading volume reached 571.1 million shares, approximately 10% above Friday’s level, providing further confirmation that the rally was supported by strong investor participation rather than light-volume trading.
Technically, the TSX strengthened its bullish profile by closing comfortably above its 25-day, 50-day and 200-day moving averages, reinforcing the positive short-, intermediate-, and long-term trend.
Sector Performance
Sector performance was mixed but decisively positive, with six of the ten major sectors closing higher. The magnitude of the gains in several cyclical sectors underscored the strength of the session.
Basic Materials led the advance, surging 5.45% as higher gold prices boosted precious metals producers. Technology followed with a 5.23% gain, while Industrials climbed 4.30%, reflecting broad investor demand for growth and economically sensitive stocks. The Financials sector added a modest 0.75%, providing additional support to the benchmark despite mixed performance among Canada’s major banks.
At the other end of the market, Energy declined 1.97%, making it the weakest-performing sector, followed by Healthcare, which fell 0.97%. According to market reports, optimism surrounding progress in U.S.–Iran negotiations raised expectations that commercial shipping through the Strait of Hormuz could normalize, weighing on crude oil prices. Lower oil prices pressured energy producers while easing inflation concerns. Meanwhile, gold prices edged higher, providing strong support for mining stocks and helping lift the broader Materials sector.
Notable Stock Movers
Within the Financials sector, the major banks generally underperformed the broader market. Bank of Montreal was the notable exception, advancing 0.63%. Investment services and insurance companies provided much of the sector’s positive contribution.
Technology shares were among the session’s strongest performers. Shopify Inc., one of the largest constituents of the TSX Technology Index, gained 5.62% to close at $173.41 on volume of 2.9 million shares. Celestica Inc. (CLS) delivered another standout performance, surging 13.0% to close at $523.74 on 655,000 shares traded, extending its strong upward momentum.
Company News
Hut 8 Corp. (HUT) reversed sharply after Friday’s strong rally. The company reported a second-quarter net loss of $1.27 per diluted share, compared with earnings of $1.18 per share in the same quarter last year. Quarterly revenue increased to $74.9 million from $41.3 million a year earlier, but investors focused on the earnings disappointment. The stock fell 9.74%, erasing part of Friday’s 22.39% gain.
Economic Developments
Economic data released Tuesday provided additional support for investor sentiment. Statistics Canada reported that the country’s trade surplus widened to $3.9 billion in June, up from $3.7 billion in May, as exports increased while import growth moderated. Separately, Canada’s manufacturing sector recorded its strongest improvement in more than four years during July, suggesting that industrial activity is gaining momentum despite ongoing global economic uncertainties.
Technical Outlook
Tuesday’s session represented more than just a rebound—it reinforced the TSX’s prevailing bullish trend. The strong upside gap at the open, steady buying throughout the day, improving market breadth, expanding new highs, and higher trading volume all point to strengthening market participation and positive momentum. The close near the session high further suggests that institutional investors remained active buyers into the end of the trading day.
As long as the TSX continues to trade above its key moving averages, the intermediate-term outlook remains constructive. While some short-term consolidation or profit-taking would not be surprising following such a strong advance, any pullback that holds above key technical support levels would likely be viewed as a healthy pause within the broader uptrend rather than a change in trend.
Key Takeaways for Traders and Investors
- The rally was broad-based. Strong market breadth, an 8-to-1 new highs-to-new lows ratio, and higher trading volume indicate widespread buying rather than a narrow advance led by a few large-cap stocks.
- Technical momentum remains positive. The TSX continues to trade above its 25-day, 50-day, and 200-day moving averages, reinforcing the prevailing bullish trend.
- Market leadership rotated toward cyclical and growth sectors. Materials, Technology, and Industrials led the advance, while Energy lagged due to weaker crude oil prices.
- Watch for healthy consolidation. After a near 600-point gain, short-term profit-taking is possible, but a pullback accompanied by light selling volume could present opportunities for investors to add positions in fundamentally strong stocks.
- Maintain focus on sector leadership. Continued strength in market breadth and leadership from Technology, Materials, and Industrials would provide further confirmation that the current rally has room to extend.
.
The US Markets
Tuesday’s U.S. Market Indexes
Market Action
U.S. equities extended their recent rally on Tuesday, with all four major benchmark indexes posting strong gains for a fourth consecutive session. The advance was broad-based, reflecting renewed investor confidence and strong buying across growth and cyclical sectors.
The Dow Jones Industrial Average climbed 907.47 points (1.71%) to close at 54,085.88. The S&P 500 gained 136.02 points (1.79%) to finish at 7,736.52, while the Nasdaq Composite led the major indexes with a 671.10-point (2.59%) surge, ending the session at 26,584.99. The Russell 2000 also participated in the rally, advancing 55.07 points (1.85%) to close at 3,036.98.
The session reflected a classic “rising tide lifts all boats” environment, with buying interest extending across large-cap, technology, and small-cap stocks. The broad participation suggests that investors are becoming increasingly confident in the sustainability of the current market advance rather than concentrating purchases in only a few mega-cap names.
Technical Analysis
Tuesday’s rally further strengthened the technical outlook for U.S. equities. The Nasdaq Composite, which experienced significant selling pressure throughout much of July—particularly among semiconductor and high-growth technology stocks—has staged an impressive recovery. Many technology stocks that suffered technical breakdowns during July are now rebuilding bullish chart patterns as institutional investors return to the sector.
The Nasdaq has regained decisive positions above its 25-day, 50-day, and 200-day moving averages, signaling that both short-term and long-term momentum have turned positive once again. The speed of the recovery suggests that the market is attempting to reclaim much of July’s losses, with the potential to complete that recovery during the early part of August if buying momentum remains intact.
The S&P 500 continues to demonstrate exceptional technical strength. The index remains comfortably above its key moving averages and has recently outperformed the other major benchmarks, highlighting continued leadership from large-cap U.S. equities. Meanwhile, the Russell 2000 has also reclaimed its 25-day, 50-day, and 200-day moving averages, indicating that investor appetite is expanding beyond mega-cap stocks into the broader market—a constructive sign for the overall health of the rally.
Outlook
The technical picture for U.S. equities remains increasingly bullish. Four consecutive sessions of gains, combined with broad participation across all major indexes, suggest that market momentum continues to strengthen. The recovery in technology and semiconductor shares, together with improving participation from small-cap stocks, indicates that market leadership is broadening rather than narrowing—a characteristic often associated with durable advances.
Although the market may experience periods of short-term consolidation following such a strong four-day rally, the prevailing trend remains positive as long as the major indexes continue to hold above their key moving averages. Continued leadership from technology stocks, coupled with improving participation from cyclicals and small-cap companies, would provide additional confirmation that the current advance has further room to extend.
Key Takeaways for Traders and Investors
- The rally remains broad-based. All four major U.S. indexes posted gains of nearly 2% or more, reflecting widespread buying across sectors and market capitalizations.
- Technology has regained leadership. The Nasdaq’s strong rebound suggests institutional investors are returning to growth stocks after July’s correction, particularly within the semiconductor and technology sectors.
- Technical trends have improved significantly. The Nasdaq, S&P 500, and Russell 2000 are all trading above their 25-day, 50-day, and 200-day moving averages, reinforcing bullish momentum across multiple time frames.
- Market participation continues to broaden. Strength in both large-cap and small-cap stocks is a constructive signal, suggesting that the current rally is becoming more sustainable.
- Watch for consolidation, not reversal. Following four consecutive strong sessions, some profit-taking would be normal. As long as key technical support levels hold, any pullback would likely represent a healthy consolidation within the broader uptrend rather than a change in market direction
Tuesday’s U.S. Market Statistics
New York Stock Exchange (NYSE): Market breadth on the New York Stock Exchange was decisively positive, confirming that Tuesday’s rally was broad-based rather than concentrated in a handful of large-cap stocks. Advancing issues significantly outnumbered declining issues, with 3,405 advancers versus 1,207 decliners, while 437 issues closed unchanged. This produced a healthy advancer-to-decliner ratio of 2.83-to-1, or nearly three advancing stocks for every one declining stock.
The market’s internal strength improved considerably as the session progressed. The NYSE recorded 558 new 52-week highs compared with just 91 new 52-week lows, a marked improvement from the previous session’s 339 new highs and 177 new lows. The new highs-to-new lows ratio strengthened to approximately 6-to-1, compared with roughly 2-to-1 in the previous session, signaling a significant expansion in market leadership and confirming that the rally extended across a wide range of industries.
NYSE trading volume reached 6.09 billion shares, representing an increase of approximately 14% from the previous session’s 5.34 billion shares. Rising prices accompanied by higher trading volume provide an important technical confirmation that buying interest was supported by meaningful institutional participation. The combination of expanding market breadth, a sharp increase in new 52-week highs, and stronger volume represents a constructive accumulation signal for the broader market.
NASDAQ: Market internals on the Nasdaq were equally impressive. Advancing issues outnumbered declining issues by exactly 3-to-1, with 3,681 advancing stocks, 1,230 declining stocks, and 374 issues unchanged. The positive breadth confirms that Tuesday’s strong advance was not driven solely by the largest technology companies but was supported across the broader Nasdaq market.
Internal momentum continued to improve. The exchange recorded 337 new 52-week highs against only 88 new 52-week lows, compared with 187 new highs and 172 new lows in the previous session. The sharp increase in new highs alongside the decline in new lows reflects strengthening participation and improving technical conditions across the technology and growth sectors. Such an expansion in new highs is often viewed as an early confirmation that market leadership is broadening and that the underlying uptrend is becoming more sustainable.
Nasdaq trading volume totalled 10.20 billion shares, approximately 13% lower than the previous session’s 11.68 billion shares. Although declining volume during a rising market is generally viewed as a less favourable technical development, one isolated session of lighter volume does not materially weaken the bullish outlook. The previous two sessions were accompanied by exceptionally strong trading activity, suggesting that institutional investors had already established significant buying positions.
If lighter volume persists over several advancing sessions, it would warrant closer monitoring, as sustained rallies are generally healthier when accompanied by expanding volume. For now, however, the decline in trading activity appears to represent normal consolidation in buying intensity rather than a deterioration in market demand.
Overall Technical Assessment
Tuesday’s market internals strongly support the bullish price action seen across the major U.S. indexes. Both the NYSE and Nasdaq recorded robust advancer-to-decliner ratios, a substantial expansion in new 52-week highs, and a notable reduction in new lows. These are classic characteristics of a healthy and broad-based market advance.
The four consecutive sessions of gains in the major indexes are now being confirmed by improving internal market statistics rather than narrowing participation. This alignment between price action and market breadth strengthens confidence that the current rally has a solid technical foundation. While traders should remain alert for normal short-term profit-taking following the recent advance, the underlying market internals continue to favour the bulls.
Key Takeaways for Traders and Investors
- Market breadth remains exceptionally strong. Nearly three stocks advanced for every decliner on both the NYSE and Nasdaq, confirming widespread buying across the market.
- New highs continue to expand. The sharp increase in 52-week highs and decline in new lows indicate that more stocks are participating in the rally, reinforcing its underlying strength.
- Institutional participation remains supportive. Higher NYSE trading volume confirms accumulation, while the lighter Nasdaq volume is not yet a concern given the strong buying seen over the previous two sessions.
- Price action and market internals are aligned. The combination of higher prices, improving breadth, expanding new highs, and positive technical trends suggests that the current rally remains fundamentally healthy.
- Monitor volume in coming sessions. Continued advances accompanied by increasing trading volume would provide further confirmation that the bullish momentum is likely to persist.
.
NOTICE TO READERS
The Canadian Vanguard Stock Market is about empowering you to build and manage your wealth by yourself. There is certainly no magic in managing finances or wealth but one needs to know what to do and commit to doing what is needed. When you are ready to start the journey to Take Charge and Put Your Destiny In Your Own Hands, start with reading The Canadian Vanguard every market day. If and when you need more related information or to advertise your business products or services in The Canadian Vanguard, Contact Us
Our readers are strongly advised to conduct their own research into individual stocks before making a purchase decision. In addition, investors are advised that past stock performance is no guarantee of future price appreciation. Any recommendation is not a guarantee of any particular stock’s future prices, and The Canadian Vanguard accepts no responsibility or liability for investors’ or readers’ purchases.
Stocks In The News/ Stocks To Watch and Market Strategy will soon be available only to Paying Subscribers. The dollar sign “$” in the Toronto Market section in the articles only stands for Canadian dollar and in the US market section “$” stands for US dollar.
(c) This article is published by The Canadian Vanguard on August 4, 2026
