Toronto’s S&P/TSX composite index fell 0.6% to 29,582.25 on Thursday, a broad retreat that followed this month’s record highs and left investors focusing on a pair of inflation and growth checkpoints due Friday.
The pullback tracked weakness across North American equities after a week of caution around valuations.
Fed Chair Jerome Powell’s recent comment that stock prices looked stretched added to the more defensive mood that carried into today’s session.
Constellation Software slumped after the company said long time leader Mark Leonard had resigned as president, a surprise that reverberated across the sector, Shopify and Celestica also traded lower.
The downdraft in growth shares overshadowed modest strength in materials and gold miners, which benefited from firmer bullion prices.
The setback arrived with the TSX still up about 20% year to date and on track for a fifth straight monthly gain, a reminder that periodic consolidation is common after sharp advances.
“The TSX is pretty close to an all time high,” said Jay Bala, CEO of AIP Asset Management, in an interview, adding that the market briefly topped 30,000 intraday this week before easing back.
BlackBerry rallied after lifting its fiscal 2026 revenue outlook on stronger cybersecurity demand, a bright spot that helped cushion the sector’s slide.
Lithium Americas said that the U.S. administration was exploring taking up to a 10% stake in the company, while Air Canada slipped after estimating a C$375 million hit to operating income tied to last month’s 4 day flight attendant strike.
Those crosscurrents illustrate how idiosyncratic catalysts are still driving outsized moves beneath the index level.
The next test arrives on Friday with Canada’s July GDP report and the U.S. Personal Consumption Expenditures price index, the Federal Reserve’s preferred inflation measure.
A softer PCE print would reinforce the case for additional U.S. easing later this year, typically a tailwind for rate sensitive and cyclical pockets of the TSX.
A firmer inflation read could keep yields elevated and prolong the rotation away from high multiple tech. Canadian GDP will be parsed for signs that domestic growth is stabilizing after a patchy first half, with particular attention on household spending and goods producing industries that feed directly into the index’s heavyweight resource names.
The TSX’s outsized exposure to financials, energy, and materials can provide ballast when global growth fears lift gold and push investors toward cash generative companies.
Dynamic showed up today as gold miners outperformed, with names such as Wesdome, Kinross, and Endeavour advancing.
If real yields ease into year end on slower inflation, the commodity complex could find support and offset weakness in software and internet shares.
A durable backup in yields would likely keep pressure on long duration assets and favor value over momentum.
