FX.co ★ Canadian Stocks Hold Pullback

On Thursday, Canada's S&P/TSX Composite Index edged lower to the 25,800 level, maintaining its decline from the record high reached on Tuesday. This dip reflects market anxieties over increasing fiscal deficits in the United States. Recently, the US House of Representatives passed a tax bill projected to significantly elevate the US budget deficit, exacerbating concerns about the nation's debt trajectory following recent credit rating downgrades. Consequently, risk assets were under pressure globally, as bond yields in North America continued to climb. The banking sector saw notable declines, with Royal Bank of Canada (RBC), Canadian Imperial Bank of Commerce (CIBC), and Bank of Montreal (BMO) experiencing losses. The mining sector also faced setbacks, as prices for bullion and precious metals fell, resulting in a 0.5% decrease in both Barrick Gold and Teck Resources. In contrast, Toronto-Dominion Bank (TD) saw a 3.5% increase in its stock price after reporting better-than-expected earnings, despite the financial institution revealing that it had been compelled to increase cash reserves as a precaution against potential bad loans amid prevailing economic uncertainties.