Market snapshot
Futures tied to Canada’s primary stock index opened Friday with modest gains as market participants digested a dense week of corporate earnings and prepared for the next domestic growth reading. By 07:24 ET (11:24 GMT), the S&P/TSX 60 index standard futures contract was up 2 points, or 0.1%.
On Thursday, the underlying S&P/TSX 60 advanced 0.5% to finish at 35,505.84, recapturing some of the losses from the session prior. The rebound was aided in part by strength among metal miners, a group lifted as gold prices moved higher amid evolving expectations for U.S. interest rate policy after the Federal Reserve’s recent announcement.
U.S. markets and tech rebound
Canadian gains followed a stronger session on Wall Street, where the S&P 500 recorded its best trading day in seven weeks, powered largely by a recovery in technology shares. U.S. stock index futures extended those gains into Friday, reflecting a modest easing of immediate concerns over the sustainability of the recent artificial intelligence-led rally.
By 07:37 ET, futures across U.S. benchmarks were higher: the Dow futures contract had risen by 2361 points, or 0.5%, S&P 500 futures had ticked up 25 points, or 0.3%, and Nasdaq 100 futures were up 296 points, or 1.1%.
Market participants and analysts pointed to reports that hedge fund Situational Awareness sold a large chunk of its public equity holdings. Some observers used that activity to argue that the recent dislocations in AI-linked stocks were driven more by technicals and forced selling than by a rapid deterioration in corporate fundamentals.
Semiconductors, AI skepticism and broader breadth
The relief rally extended to chipmakers: the Philadelphia Semiconductor Index jumped sharply, rising 8.19% in Thursday trade. That marked the benchmark index’s largest single-session gain since April 2025 and helped bolster the broader S&P 500 even as, according to Deutsche Bank analysts, most stocks within the index actually declined that day.
Despite renewed buying in some large-cap technology names, skepticism about the pace and scale of AI-related spending remained, exemplified by mixed reactions to results from major platforms. Returns from Facebook-owner Meta Platforms preserved some caution among investors around AI expenditures even as the short-term rebound took hold.
Policy, data and global flows
Traders also spent the week parsing the Fed’s decision to keep interest rates unchanged on Wednesday, and digesting U.S. data that showed the world’s largest economy slowed in the second quarter while remaining on relatively firm footing. Inflation, measured by the core personal consumption expenditures index, cooled in June, adding nuance to expectations around future policy moves.
Fed commentary this week included remarks from Fed Chair Kevin Warsh, who stressed that policymakers stood ready to address inflationary pressures, implying a readiness to raise rates if warranted. Warsh also suggested that market-driven tightening via bond yields may be performing some of the Fed’s work, leaving traders uncertain about the next policy step. CME FedWatch currently assigns roughly a 63% probability to a September rate increase, down from more than 80% a week earlier.
Asia and Europe
Positive sentiment carried into Asian trading overnight. A strong rebound in technology shares lifted South Korea’s KOSPI by 17.91%. Stocks in Europe also traded higher, reflecting the cross-border reach of the risk-on move.
Oil and shipping
Oil prices were volatile but remained on track for a monthly gain approaching roughly 20%, as flows from the Gulf region showed signs of recovery despite stalled talks between the U.S. and Iran. Both benchmark crude contracts were set for weekly losses amid waning hopes early in the week for a diplomatic resolution, yet remained poised to post sharp gains for July overall.
Ship-tracking data indicated a small rise in tanker transits through the Strait of Hormuz, which eased some worries about a prolonged disruption to a critical oil transit corridor. ING analysts highlighted that while crossings remained in single digits, there were reports the shuttling of oil across the strait had resumed and that such activity would not always be visible in tracking data because transponders may be turned off.
Gold and the dollar
Gold prices fell as market participants tried to gauge the likely path for U.S. interest rates. The debate over whether the Fed will tighten further, and the indication that market forces may already be tightening financial conditions, left traders split on direction. A firmer dollar following its large one-day decline earlier in the week added downward pressure on the precious metal, increasing its cost for overseas buyers.
The prospect that the Fed might not raise rates further could support gold by lowering the opportunity cost of holding a non-yielding asset. Nevertheless, shifts in rate expectations and dollar moves have kept the yellow metal’s near-term trajectory uncertain.
What traders are watching next
Participants enter the weekend focused on upcoming domestic growth data for Canada, with earnings flow and the persistence of commodity-driven volatility remaining central themes. The mix of corporate results, central bank positioning and geopolitically sensitive commodity flows is likely to keep markets reactive in the near term.