Market snapshot
Canada's primary equity benchmark advanced modestly on Friday as investors tried to reconcile upbeat U.S. employment data with fresh military exchanges near the Strait of Hormuz. The S&P/TSX Composite climbed 172.59 points, or 0.51%, to 34,029.21 by mid-morning. The blue-chip S&P/TSX 60 increased 7.61 points, or 0.39%, to 1,972.68.
U.S. employment lifts sentiment
Wall Street opened higher following the release of a stronger-than-expected April jobs report from the U.S. Bureau of Labor Statistics, helping to buoy Canadian markets. The S&P 500 rose 0.72% and the NASDAQ Composite gained 1.19% in early trading. U.S. employers added 115,000 jobs in April, well above the 65,000 positions economists had forecasted, while the unemployment rate remained at 4.3%. Market participants interpreted the data as a signal of continued economic durability for policymakers.
Canadian labour market shows modest softness
By contrast, Statistics Canada reported domestic employment was largely unchanged in April, as the country shed 18,000 positions. The national unemployment rate increased by 0.2 percentage points to 6.9%. Regional details showed the largest losses occurred in Quebec, where employment fell by 43,000, concentrated around the Montréal area. Ontario partially offset those declines with a gain of 42,000 jobs.
Energy and precious metals react to Strait of Hormuz activity
Geopolitical developments in the Strait of Hormuz drove movements in energy and safe-haven assets. Crude Oil WTI Futures rose 0.4% to $95.16 per barrel, while Brent Oil Futures climbed 1.09% to $101.15. Reports indicated U.S. and Iranian forces exchanged fire near the strategic waterway, and the U.S. military said it intercepted Iranian drones and missiles targeting three warships. President Donald Trump later described the exchange as a "love tap."
Gold extended gains for a fourth consecutive session as investors sought refuge from geopolitical uncertainty. XAU/USD increased 0.8% to reach $4,725.34 per ounce. Market observers noted that volatility remains elevated while traders continue to monitor the shipping lanes that handle about one-fifth of global oil shipments.
Outlook and risk premium
Although crude prices rose on the day, they remain positioned for a roughly 7% weekly decline amid lingering hopes for a negotiated settlement. Analysts quoted in market commentary suggested that, while a ceasefire officially holds, the risk premium on energy assets is likely to remain until a formal framework is signed. That elevated risk premium is influencing trading in energy and related sectors, and contributing to demand for safe-haven assets such as gold.
Implications for investors
Market participants balanced the reassurance of a resilient U.S. labor market with renewed geopolitical risks that affect energy supply routes and commodity prices. The immediate reaction in equities was positive, reflecting cross-border sensitivity to U.S. economic data, while energy and precious metals responded to the security developments in the Middle East.
Key data cited in this report
- S&P/TSX Composite: +172.59 points (+0.51%) to 34,029.21
- S&P/TSX 60: +7.61 points (+0.39%) to 1,972.68
- S&P 500: +0.72% (early trading)
- NASDAQ Composite: +1.19% (early trading)
- U.S. payrolls: +115,000 in April (consensus 65,000)
- U.S. unemployment rate: 4.3%
- Canada employment: -18,000 in April; unemployment rate 6.9% (up 0.2 percentage points)
- Quebec employment: -43,000; Ontario employment: +42,000
- WTI crude: +0.4% to $95.16 per barrel
- Brent crude: +1.09% to $101.15 per barrel
- Gold (XAU/USD): +0.8% to $4,725.34 per ounce