Futures linked to Canada’s resource-heavy main stock benchmark were trading higher on Tuesday, supported by firmer gold prices and a pullback in crude oil after reports of renewed diplomatic activity aimed at easing tensions in the Middle East.
By 07:33 ET (11:33 GMT), the S&P/TSX 60 index standard futures contract had advanced 19 points, or 0.9%. The Toronto Stock Exchange’s S&P/TSX composite index had been closed on Monday for a holiday; on Friday it finished lower by 0.8% at 35,226.14. The TSX posted a 1.1% gain in July, aided in part by strength in energy stocks.
U.S. futures and market context
U.S. stock futures were higher on Tuesday as market participants weighed a flurry of reports about possible U.S.-Iran ceasefire negotiations while positioning for upcoming corporate results from SpaceX. At 07:42 ET, Dow futures had risen about 0.9%, S&P 500 futures were up roughly 0.2%, and Nasdaq 100 futures had increased by about 0.9%.
Traders entered the session following a generally positive day on Wall Street on Monday, when equities were helped by a steep decline in oil prices after new hopes for diplomatic progress in the Iran conflict. Technology names recovered some of the losses they had recorded in the prior month, even as market participants continued to voice concern about the durability of very large capital spending on artificial intelligence infrastructure such as data centers and semiconductor chips.
Diplomatic developments and the oil market
Comments attributed to U.S. Treasury Secretary Scott Bessent suggested that an accord with Iran could be imminent, with the possibility of a deal "today or tomorrow" to reopen the Strait of Hormuz and bring the region toward a more normalized state. Qatar was also reported to be actively pursuing de-escalation efforts and said language for a potential short-term resolution was being circulated among negotiators. Those reports noted that while direct talks are not currently agreed, a temporary arrangement to ease tensions remains the focus.
Those diplomatic headlines prompted crude oil to give back earlier gains. As of 07:45 ET, Brent crude futures, the global benchmark, had eased about 1.8% to $82.23 per barrel after rising more than 2.5% earlier in the session. U.S. West Texas Intermediate futures fell about 2.6% to $78.24 per barrel. Earlier in the week, U.S. political comments indicated revived talk of engagement with Iran, while Iranian officials publicly denied that direct dialogue had begun. Tehran did confirm it was in contact with Oman about the Strait of Hormuz, though shipping activity through the channel remained sparse and military tensions in the Gulf stayed elevated.
Gold firm as oil retreat eases inflation worries
Precious metals strengthened as the fall in crude helped reduce some investor anxiety about inflation and the potential for further central bank rate hikes. Spot gold was trading higher by 0.6% at $4,080.63 an ounce at 08:37 ET, while gold futures were up about 1.2% at $4,138.00 an ounce.
Gold remained confined to a recent intra-range between roughly $4,000 and $4,100 an ounce as market participants tried to reconcile the mixed signals coming from Washington and Tehran over the reopening of the Strait of Hormuz. Analysts and traders have been cautious because disruptions in that vital waterway could trigger an energy-driven rise in inflation, which would increase the likelihood of additional tightening from central banks such as the Federal Reserve. As a non-yielding asset, bullion tends to lose appeal when policy rates are raised.
Dollar and broader market drivers
The U.S. dollar index, which measures the greenback against a basket of global currencies, had largely steadied after earlier weakness following a yen-buying intervention. A firmer dollar can weigh on the appeal of gold for overseas buyers by making the metal more expensive in other currencies.
Overall market moves reflected a combination of geopolitics, commodity price swings and calendar effects related to earnings anticipation. For Canadian markets, the composition skewed toward resources left the TSX sensitive to moves in oil and precious metals prices.
What to watch next
Traders will continue to monitor statements from negotiators and regional intermediaries for any confirmation of a near-term deal to ease maritime tensions. Market participants will also be watching upcoming corporate reports and any shifts in central bank commentary that could alter expectations for future interest-rate paths.
Given the interplay between energy prices, inflation expectations and monetary policy, commodity-sensitive equity benchmarks such as Canada’s TSX may remain responsive to developments around the Strait of Hormuz and to short-term moves in oil and gold.