The S&P/TSX Composite Index climbed more than 1% on Monday, moving back above the 35,000 mark after the United States and Iran announced a preliminary peace agreement aimed at ending the conflict. US President Donald Trump said the deal would halt hostilities and allow the reopening of the Strait of Hormuz.
Crude oil prices fell following the announcement, easing fears that an energy-driven surge in inflation could force global central banks into a more hawkish stance. Bond yields also moved lower, helping to alleviate concerns about rising borrowing costs.
Financials advanced, with shares of BMO and Scotiabank each gaining more than 1%, while Brookfield added over 2%. At the same time, a rise in gold prices underpinned a strong rally in mining stocks: Agnico Eagle and WPM jumped more than 7%, and Barrick added over 5%.
In contrast, energy stocks slumped in response to weaker oil prices. Canadian Natural fell 4.5%, and Suncor declined 5%.
Investors are now turning their attention to the Federal Reserve’s policy meeting, which concludes on Wednesday, with markets broadly expecting interest rates to be left unchanged.
