Jan 2 (Reuters) - Canada's main stock index rose to a two-week high on the first trading day of the year, as rising gold and oil prices boosted commodity-linked sectors.
The S&P/TSX composite index (.GSPTSE), rose 0.9% to 24,949.52 points - its strongest level since December 18.
The TSX ended 2024 with gains of nearly 18%, its best annual performance since 2021, as monetary policy easing by major central banks increased optimism for economic growth.
All 11 sectors rose on Thursday, with gold miners (.SPTTGD), and material stocks (.GSPTTMT), in the lead.
"2024 was a largely policy-driven market," said Shiraz Ahmed, senior portfolio manager and founder of Sartorial Wealth at Raymond James.
"We export a lot of goods to the United States. So if the U.S. as a consumer is doing well, then Canada typically does reasonably well. That being said, if there are tariffs, that could change the game for 2025."
The prospects of fewer rate cuts by the U.S. Federal Reserve and potential policy shifts under U.S. President-elect Donald Trump's upcoming administration look set to dominate the market narrative at the beginning of 2025.
Trump, who will be sworn in on Jan. 20, is expected to cut taxes and pursue deregulation, supporting growth.
But his threat of a 25% tariff on Canadian imports casts a shadow, given the volume of trade.
Wall Street lost ground on Tuesday as investors closed the book on a remarkable year for equities.
S&P Global manufacturing purchasing manager's index (PMI) figures for December showed that Canadian manufacturing activity rose at the fastest pace in nearly two years.
Investors are also waiting for monthly employment data from Canada and the U.S., to be released next week, for insights into the monetary policy direction in both countries.
In a week shortened by Wednesday's New Year's holiday, trading volumes are expected to be light.
Reporting by Ragini Mathur in Bengaluru; Editing by Sahal Muhammed
