TSX Rebounds on Wednesday

The TSX/S&P Composite Index rose 1% to close at a record 34,831 on Monday, on signs that the US and Iran were negotiating an end to their conflict. Reports are that Iran would move to reopen the Strait of Hormuz during a 30-day window following an agreement, while the ceasefire reached in early April would be extended by 60 days, with talks on Iran’s nuclear program planned during the two-month pause. Oil prices fell, easing inflation concerns and lowering bond yields, supporting the financial sector. Results from banks, including RBC (+0.8%), TD Bank (+1.2%), and BMO (+0.9%) are due this week. Mining stocks also advanced as gold prices climbed, with Agnico Eagle gaining 4.6%, Barrick rising 4.2%, and WPM adding 5.6%. Meanwhile, energy stocks were the main laggards, declining alongside the pullback in oil prices, as Canadian Natural fell 3.6% and Suncor lost 3%. On the trade front, the first round of formal negotiations for the US-Mexico-Canada free trade agreement has begun.

The S&P/TSX Composite Index rose nearly 1% to trade above 34,500 on Monday, supported by signs that the US and Iran are nearing an agreement. US President Trump said on Saturday that a memorandum of understanding on a potential deal with Iran was “largely negotiated,” while both countries and mediators in Pakistan pointed to progress in talks. Oil prices fell on hopes that an agreement could reopen the Strait of Hormuz, easing stagflation concerns and pushing bond yields lower. Investors also awaited quarterly earnings from major Canadian lenders, with RBC rising 0.9%, TD Bank gaining 1.1%, and BMO adding 1.1%. Optimism surrounding AI-related technology stocks lifted Shopify by more than 1.6%. Meanwhile, higher gold prices supported mining shares, with Agnico Eagle and Barrick rising nearly 3% and Wheaton Precious Metals gaining over 4.5%. In contrast, lower crude prices weighed on energy producers, with Canadian Natural down more than 2% and Suncor Energy losing nearly 2%.

Futures tracking the S&P/TSX Composite Index rose on Monday, supported by signs that the US and Iran are nearing a peace agreement. US President Donald Trump said on Saturday that a memorandum of understanding on a potential deal with Iran was “largely negotiated,” while both countries and mediators in Pakistan pointed to progress in talks. Oil prices fell below $100 per barrel on hopes that an agreement could reopen the Strait of Hormuz, easing stagflation concerns and lowering bond yields, which supports banks and the broader index. Investors also awaited quarterly earnings from major Canadian lenders, including Royal Bank of Canada, TD Bank, and Bank of Montreal, due later this week. Optimism surrounding AI-related tech stocks has been giving support to Canadian technology shares. Meanwhile, gold prices rose, supporting mining stocks, while energy shares are expected to face pressure from lower crude prices.