The S&P/TSX Composite Index rose 0.4% to close at 35,002 on Monday, as investors weighed progress in US-Iran peace talks and Canada’s May inflation data. Reports indicated that Washington and Tehran made headway in their first round of negotiations toward a final peace agreement. Crude prices declined on the news, easing concerns about energy-driven inflation pressures.
On the domestic front, annual inflation accelerated more than expected in May, largely due to higher gasoline prices. Still, the figures are unlikely to alter the Bank of Canada’s assessment of underlying inflation, with core measures remaining subdued. Earlier this month, the BoC noted it saw limited evidence that higher energy costs were feeding through to broader price pressures.
In regulatory developments, Canada’s banking watchdog lowered capital requirements for the country’s largest lenders, a step expected to underpin credit growth. Financial stocks advanced on the move, with Royal Bank of Canada gaining 1% and Bank of Montreal up 1.2%.
Elsewhere on the index, rising gold prices supported mining shares: Agnico Eagle climbed 2.2%, Wheaton Precious Metals advanced 4.7%, and Barrick Gold added 1.2%.
