TSX Futures Rise 1.1 Percent as Gold Gains Offset Chip Selloff

Canadian equity futures climbed on Tuesday, October 13, as firmer precious-metal prices and steadier bond yields supported expectations for the Toronto Stock Exchange's reopening after the Thanksgiving holiday. December futures on the S&P/TSX index advanced 1.1% in early trading, according to Kitco and Yahoo Finance Canada, despite mounting pressure on global semiconductor stocks.

The move followed a 519.24-point, or 1.5%, rally in the S&P/TSX Composite Index on Friday, which lifted the benchmark to 35,664.62. Yahoo Finance Canada reported that the gain was the index's largest in five weeks, while the benchmark added approximately 0.98% over the week. Markets remained closed Monday for Canadian Thanksgiving.

Lower-than-expected Canadian employment data had reduced expectations for further monetary tightening by the Bank of Canada. Kitco reported that markets priced in a 28% probability of an interest rate increase at the central bank's October meeting, leaving investors focused on interest rate expectations, corporate earnings and commodity prices.

Gold and silver prices edged higher as oil retreated. Brent crude fell approximately 2% to $104.78 a barrel, according to Kitco, as traders weighed potential disruptions to Saudi supply against increased Russian diesel exports. Canada's 10-year government bond yield eased to 3.878%, while the comparable US yield remained largely unchanged at 5.244%.

Investors also awaited US consumer inflation data expected later in the week for clues about the Federal Reserve's monetary policy. According to Kitco, market pricing indicated expectations for at least one additional 25-basis-point Fed rate increase before year-end, amid concerns about energy costs and government debt.

Semiconductor shares faced international selling pressure after South Korea's Kospi index fell 5.5%, reaching its lowest level since July 31. Yahoo Finance Canada attributed the weakness to concerns about stock valuations and increasing competition from China, while Kitco highlighted advances by Chinese memory-chip manufacturer CXMT.

CXMT announced plans to release a more powerful chip by year-end, intensifying concerns about competition in the memory market. SK Hynix and Western Digital each lost approximately 5%, while Micron, Seagate Technology and Sandisk declined by more than 3%, according to Yahoo Finance Canada.

In the United States, Dow Jones Industrial Average futures gained 278 points, or 0.5%, to 52,388. S&P 500 futures fell 5.75 points, or 0.7%, to 7,852.25, while Nasdaq Composite futures dropped 218 points, or 0.7%, to 30,680.25.

Major bank earnings added another focus for investors. JPMorgan Chase initially fell after reporting third-quarter revenue and earnings below analyst expectations but later recovered to trade 1% higher. Wells Fargo slipped 0.5% following mixed quarterly results, while Citigroup and Goldman Sachs were scheduled to report later Tuesday. UnitedHealth gained 1% after exceeding analyst expectations.

Canadian corporate developments also drew attention. Czech arms manufacturer CSG acquired a 9.5% stake in MDA Space, becoming the Canadian satellite and space technology company's largest shareholder, according to Yahoo Finance Canada and Kitco.

Friday's advance was supported by strength in mining, consumer cyclical and technology shares. Aritzia led the benchmark's gainers, rising 21% after reporting a 44.1% year-over-year increase in fiscal second-quarter revenue to $1.2 billion for the quarter ended in August. Comparable sales rose 34.5%, US revenue increased more than 60%, and digital sales climbed approximately 68%.

Aritzia's adjusted net profit more than doubled to $156 million, prompting the retailer to raise its full-year revenue outlook. Lundin Gold, DPM Metals and NovaGold Resources also gained at least 8% each. On the other side of the market, Cogeco Communications, BCE, Air Canada and Rogers Communications each fell at least 3.7%.

Canadian investors were also monitoring stalled trade negotiations between Ottawa and Washington, alongside escalating Middle Eastern tensions. Houthi attacks on Saudi Arabian airports and threats to shipping through the Strait of Hormuz raised concerns about energy supplies, while the potential impact on crude prices and inflation remained a factor for the market's next session.