TSX Futures Edge Down Amid Ongoing Geopolitical Uncertainty

The S&P/TSX Composite Index edged higher to above the 33,150 on Monday as investors weighed a Pakistan-brokered US-Iran peace proposal amid ongoing regional tensions. A senior Iranian official stated that Tehran would not reopen the Strait of Hormuz as part of a temporary ceasefire and rejected deadlines while reviewing the proposal which kept global supply concerns elevated. Financial heavyweights provided support as RBC, TD Bank and BMO all advanced over 0.6%. Energy producers showed resilience despite fluctuating crude prices with Imperial Oil rising 0.7% and Suncor Energy gaining 0.6% alongside a 0.7% increase for Canadian Natural Resources. Mining stocks were mixed as Agnico Eagle and Barrick Gold fell 0.2% and 1.1%. Domestically S&P Global data showed Canada’s Composite PMI recorded 47.6 in March remaining in contraction for a fifth straight month as the Middle East conflict weighed on demand.

Futures tracking the S&P/TSX Composite Index edged down on Monday as investors weighed a Pakistan-brokered US-Iran peace proposal. A senior Iranian official said Tehran would not reopen the Strait of Hormuz as part of a temporary ceasefire and would not accept deadlines while reviewing the proposal. Oil prices inched lower ahead of talks, though supply concerns from ongoing shipping disruptions persisted. Banks were mostly lower amid the fresh increase in bond yields. In turn, energy producers, which had benefited greatly from the oil supply crisis, came under pressure as crude prices dipped. Meanwhile, gold edged up, offering some support to miners.

The S&P/TSX Composite Index recovered from early losses to close 0.5% higher at 33,108 on Thursday, tracking the rebound for US equities as reports that Iran is considering allowing some shipments of oil from the Persian Gulf eased concerns of stagflation in the Canadian economy. Iranian media indicated that officials are coordinating a toll for tankers leaving the Persian Gulf. The development alleviated concerns that an energy shock would magnify inflationary pressures and force the BoC to maintain rates restrictive for longer, aiding the outlook for stocks in the Toronto exchange. Heavyweight energy producers led the gains as spot crude oil benchmarks rose to their highest in 18 years, with Cenvovus and Canadian Natural rising 3% and 2%, respectively. The Toronto Stock Exchange will be closed on Friday for Good Friday.