TSX Renews Record High on Mining Strength

The S&P/TSX Composite Index lost 1% on Thursday to trade below 33,000 as hopes of a swift Middle East resolution faded after US President Trump signaled an escalation in attacks on Iran. Oil prices rebounded sharply on supply concerns, fueling stagflation worries. Canadian bond yields climbed as investors priced in a more hawkish outlook from the BoC and other major central banks, weighing on banking stocks amid credit demand concerns. The Royal Bank of Canada lost nearly 1%, TD Bank fell over 0.5%, and Bank of Montreal dropped 1.5%. Gold prices retreated from two-week highs as Trump flagged continued US military action in Iran. Agnico Eagle lost over 2.6%, while WPM plunged nearly 3.5%. In contrast, energy producers advanced on higher oil prices, Canadian Natural rose 4% and Suncor Energy gained over 3%.

Futures tracking the S&P/TSX Composite Index were lower on Thursday as hopes of a swift end to the Middle East war faded after US President Trump signaled an escalation in attacks on Iran. Oil prices rebounded sharply on supply concerns, fueling stagflation worries. Canadian bond yields climbed amid the inflationary pressures as investors price in an increasingly hawkish outlook for major central banks, weighing on banking stocks as credit demand could face headwinds. The Bank of Canada is expected to hold interest rates unchanged this month, though traders are pricing in two quarter-point hikes by year-end. The central bank's governing council noted it will rely more than usual on its own judgment on rate decisions given heightened global uncertainty, according to minutes released Wednesday. In contrast, higher oil prices supported energy stocks, while falling gold prices pressured miners, retreating from two-week highs as Trump flagged continued US military action in Iran.

The S&P/TSX Composite Index rose 0.6% to close at 32,958 on Wednesday as global markets rallied amid signs of de-escalation in the Middle East. President Donald Trump and Secretary of State Marco Rubio reinforced expectations for a swift conclusion to the conflict with Iran which pulled crude futures down. Gold and precious metals mining stocks led the rise as Kinross Gold rose 4.6%, Wheaton Precious Metals added 4.1% while Barrick Gold and Agnico Eagle both climbed over 3%. Lower energy costs and a global retreat in the US dollar supported financial heavyweights as TD Bank and RBC gained 1.1% and 0.9% while National Bank of Canada jumped 2.4%. Conversely falling oil prices weighed on producers with Canadian Natural Resources sinking 4.7% and Suncor Energy declining 1.9% alongside a 1.5% drop for Imperial Oil. After logging a 4.55% decline in March the TSX started the second quarter on a positive note while investors await a national address from the White House.