Canada’s stock rally appears likely to get a boost from corporate profits, with

Scotiabank

predicting that the earnings of the biggest publicly traded companies may have jumped to another record during the third quarter.

The firm’s strategists said the strong quarterly reports from

U.S. banks

bode well for their Canadian counterparts, which account for 30 per cent of the stocks in S&P/TSX Composite. At the same time, mining companies, which also have a big weighting in the index, are poised to gain from the surge in

gold prices. 

The significant sway those industries have on the index may allow profits to continue surprising to the upside — and support its 23 per cent advance so far this year — even as the U.S. trade war exerts a significant drag on

Canada’s economy

. The Scotiabank strategists said that the third-quarter earnings per share in the S&P/TSX — which the consensus forecast pegs at $400 — could eclipse the record $405 seen in the prior three months.

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“We believe expectations could be exceeded and a new quarterly EPS high could be achieved,” Hugo Ste-Marie, director of portfolio and quantitative strategy at Scotiabank, said a note to clients Monday.

Bloomberg.com