Canadian equities concluded their second-best year this century, defying early anxieties and setting a record for new closing highs. The S&P/TSX Composite Index surged more than 40% from an April 8 low, ultimately closing the year with a 28% gain. This performance marked the index's most significant annual increase since 2009, when the rebound from the financial crisis spurred a 31% rise.

Throughout the year, the index achieved a record 63 new closing highs, fueled by a consistent upward trend during the final seven months. This remarkable growth occurred despite initial headwinds, including trade tensions instigated by then-US President Donald Trump and political uncertainty within Canada. Trump's initial imposition of harsh tariffs, coupled with open discussions about annexing Canada, created significant unease in financial markets.

The market's turnaround was partly attributed to a shift in political landscape. Mark Carney's appointment as prime minister helped stabilize financial markets and de-escalate tensions with the US. Furthermore, the composition of the Canadian equity market, heavily weighted towards mining and internationally recognized financial institutions, proved advantageous in navigating the volatile global environment.

The strong performance of mining and bank stocks was central to the index's overall success. These sectors benefited from the specific conditions of the global economy, contributing significantly to the record-breaking year. While the future remains subject to various economic and political factors, the resilience demonstrated by Canadian equities in the face of earlier challenges suggests a solid foundation for continued growth.