TSX Futures Edge Higher After US-Iran Deal

Canada’s S&P/TSX Composite Index edged lower to trade near 35,000 on Wednesday as investors weighed a hawkish US Fed outlook and the signing of an interim peace deal between the US and Iran. The Fed kept interest rates unchanged, but its projections were seen as more hawkish than anticipated, with roughly half of FOMC members expecting at least one rate hike this year, raising concerns over higher borrowing costs. Financial stocks traded mixed, with TD Bank up nearly 1%, while Brookfield edged lower. Mining stocks were also mixed as gold prices eased, with Barrick gaining nearly 1%, while Agnico Eagle and WPM slipped. The energy sector weighed heavily as oil prices declined after the US-Iran agreement aimed at ending the conflict and reopening the Strait of Hormuz. Canadian Natural and Suncor fell over 3%, while Imperial Oil lost nearly 4%. Tech stocks also weakened, tracking losses in the US software sector, with Shopify down 0.9% and Constellation Software falling more than 2%.

Futures tracking Canada’s S&P/TSX Composite Index edged higher after the signing of an interim peace deal between the US and Iran. The agreement aims to end the conflict and reopen the Strait of Hormuz, while negotiations over Tehran’s nuclear program are set to begin later this week. Oil prices fell following the deal, easing concerns over a fresh wave of global inflation and prolonged high interest rates, supporting financial stocks and the broader index. Meanwhile, gold prices edged lower as the US dollar strengthened amid a hawkish Federal Reserve outlook, weighing on mining stocks. Energy shares are also set to come under pressure as oil prices decline.

The S&P/TSX Composite Index fell 0.7% to close at 35,125 on Wednesday as investors digested the Fed's latest policy decision. As widely expected, the Federal Reserve left interest rates unchanged. However, its projections were viewed as more hawkish than anticipated, with roughly half of FOMC members expecting at least one rate hike this year. The Fed also sharply raised its inflation forecasts, pushing Canadian bond yields higher and fueling concerns that borrowing costs could remain elevated. Financial stocks traded mixed, with TD Bank gaining 1.2% while Brookfield fell 1.1%. Energy shares weighed on the index as oil prices hovered near a three-month low amid prospects for the reopening of the Strait of Hormuz and after the International Energy Agency warned of a supply overhang next year. Canadian Natural lost 1.4%, while Suncor shed 2.5%. Mining stocks also traded lower amid falling gold prices, with Barrick down 2.6% and WPM losing 0.8%.