Canada’s main equity benchmark pushed higher on Monday as investors navigated intensifying geopolitical tensions in the Middle East. The S&P/TSX Composite Index advanced 119.07 points, or 0.35%, to 34,459.06, recovering from Friday’s pullback and tracking strength in energy and mining shares.
The move came as global markets reacted to a dramatic escalation in hostilities between the U.S., Israel and Iran, developments that jolted commodity prices and reignited demand for safe-haven assets.
TSX Rebounds After Friday Dip
The TSX had finished Friday down 0.5% at 34,339.99, pausing after three consecutive record highs. Monday’s rebound signals that investors are rotating into commodity-linked names as crude oil and gold prices surge.
Energy and materials stocks — both heavyweight sectors within the Canadian index — provided key support.
Among the top performers:
- Energy Fuels Inc surged 9.68% to $31.95, making it the session’s top gainer.
- Novagold Resources Inc climbed 6.87% to $19.45.
- Cameco Corp gained 6.46% to $171.80.
- Vermilion Energy Inc rose 5.32% to $15.43.
- Denison Mines Corp advanced 4.58% to $5.94.
The rally in uranium, gold, and energy names underscores how closely Canada’s equity market is tied to commodity cycles, particularly during geopolitical stress.
Oil Jumps 6% as Strait of Hormuz Fears Intensify
Crude oil prices spiked sharply following U.S. and Israeli air strikes on Iran and Tehran’s retaliatory actions across the Middle East.
- Brent crude surged roughly 6% to $77.43 per barrel
- U.S. WTI crude jumped 5.5% to $70.66 per barrel
The focal point for traders remains the Strait of Hormuz, a critical shipping route that carries nearly one-fifth of global oil supply. While the waterway has not officially closed, reported traffic slowdowns and rerouting have amplified supply concerns.
For the TSX, higher oil prices typically translate into stronger earnings expectations for its large-cap energy producers, cushioning broader equity volatility.
Gold Climbs Above $5,380 as Safe-Haven Demand Builds
Gold prices also surged as investors hedged against geopolitical escalation.
- Spot gold rose about 2.0% to $5,382.50 per ounce
- U.S. gold futures climbed 2.8% to $5,397.16
The metal briefly touched $5,419.32, marking its highest level since late January.
Canada’s materials sector — heavily weighted toward gold miners — benefited from the rally, helping offset weakness in more rate-sensitive segments.
U.S. Markets Mixed After Early Selloff
South of the border, Wall Street recovered from earlier declines:
- The S&P 500 edged up 0.26% to 6,880.70
- The NASDAQ Composite gained 0.3% to 22,742.06
- The Dow Jones Industrial Average slipped 0.1% to 48,933.66
Earlier in the session, U.S. equities had fallen sharply amid flight-to-safety flows before bargain hunting stabilized sentiment.
Geopolitics Reshapes Risk Appetite
The weekend strikes marked a significant escalation in tensions between Washington and Tehran, particularly following stalled nuclear negotiations.
Iran retaliated with strikes targeting locations in Israel, Bahrain, Qatar and the UAE. Markets are now grappling with the risk of a prolonged regional conflict.
Energy supply risks are front and center. Any material disruption to Middle Eastern exports could further push oil prices higher, bolstering energy-heavy indices like the TSX while pressuring global growth expectations.
Berkshire’s Rough Quarter Adds to Uncertainty
Separately, Berkshire Hathaway reported nearly a 30% drop in fourth-quarter operating profit, weighed down by insurance underwriting weakness. The quarter marked Warren Buffett’s final stretch as CEO, with Greg Abel issuing his first shareholder letter as successor.
While not directly impacting the TSX, Berkshire’s results added to the broader narrative of earnings volatility amid macro uncertainty.
What Comes Next for TSX?
Investors now turn attention to upcoming U.S. economic data, including manufacturing PMIs, retail sales, ADP employment figures and nonfarm payrolls — all of which could influence interest rate expectations.
For Canada’s TSX, three factors will likely determine near-term direction:
- Oil price trajectory
- Gold momentum
- Extent of Middle East escalation
For now, commodity strength is acting as a stabilizer.
With the index back above 34,450, energy and mining stocks are once again steering performance — and Monday’s top gainer, Energy Fuels Inc. (+9.68%), illustrates how quickly capital rotates into resource plays when geopolitical risk flares.
If oil remains above $70 and gold sustains levels near $5,400 per ounce, the TSX may continue to demonstrate relative resilience compared with more tech-heavy global benchmarks.
In volatile times, Canada’s commodity backbone is once again proving to be both shield and driver for its equity market.
