The Canadian stock market continued to trade on a bullish note on Monday as investors reacted positively to signs that the U.S. and Iran were still pursuing a diplomatic resolution to the ongoing conflict, with both sides signalling that talks were still ongoing. As easing concerns around prolonged disruptions in the Strait of Hormuz supported broader market sentiment, the S&P/TSX Composite Index jumped by 360 points, or 1%, from its previous closing level to settle at 34,831 — marking its fourth consecutive daily gain and a fresh record closing high for the benchmark.
While steep declines in commodity prices led to a selloff in energy stocks, the rally in the TSX benchmark was mainly driven by strong gains in other key sectors, such as mining, industrials, and technology.
At the same time, further declines in domestic Treasury bond yields, after reaching their highest level in over a year earlier this month, also improved investor appetite for interest rate-sensitive sectors such as real estate and financials.
Top TSX Composite movers and active stocks
Mining stocks such as Hudbay Minerals, First Quantum Minerals, Capstone Copper, and Montage Gold led the market rally, with each surging at least 7% to rank among the day’s top gainers on the Toronto Stock Exchange.
In contrast, weaker oil and gas prices weighed on energy companies, with Tamarack Valley Energy, Baytex Energy, Athabasca Oil, and Strathcona Resources all dropping at least 5%, making them the worst-performing TSX stocks for the day.
Shares of Pembina Pipeline (TSX:PPL) also slipped by 1.1% after the energy transportation and midstream service firm revealed plans to move ahead with its $570 million Heartland Extraction Plant project in Alberta and updated its long-term ethane supply agreement with Dow.
While the project is expected to strengthen Pembina’s natural gas liquids franchise and support its long-term EBITDA (earnings before interest, taxes, depreciation, and amortization) growth targets, investor sentiment toward energy stocks remained weak as oil prices fell sharply. Despite the recent weakness, however, PPL stock is still up around 30% on a year-to-date basis.
Based on their daily trade volume, Manulife Financial, Whitecap Resources, BlackBerry, Brookfield Asset Management, and Cenovus Energy were the five most active stocks on the exchange.
TSX today
West Texas Intermediate (WTI) crude oil futures prices fell sharply in early trading on Tuesday, but metals prices trended lower, pointing to a weak opening for the resource-heavy TSX benchmark today. Continued volatility in commodity markets could keep pressure on both Canadian energy and mining shares in the near term.
Fresh geopolitical tensions are likely to stay in focus for Canadian investors after the U.S. launched new strikes targeting Iranian missile sites and vessels near the Strait of Hormuz. Despite the military action, Secretary of State Marco Rubio said negotiations with Iran were still advancing.
Reports also suggested that discussions remain focused on reopening the Strait of Hormuz and resolving disputes around Iran’s enriched uranium stockpile and frozen foreign assets. Given the TSX’s large exposure to commodity producers, any further escalation or breakthrough in the U.S.-Iran talks could continue driving sharp swings in oil prices and broader market sentiment.
With no major domestic economic releases due, Canadian investors may want to keep an eye on the latest U.S. consumer confidence data this morning. On the corporate events side, the TSX-listed Silvercorp Metals will release its latest quarterly earnings report today after the market closing bell.
Market movers on the TSX today
