The S&P/TSX Composite Index rose 1% to close at 32,877 on Monday, as markets absorbed a benign inflation report and took comfort from easing geopolitical tensions affecting crude oil supply. Canada’s headline annual inflation rate slowed to 1.8% in February from 2.3% in January, providing a boost to domestic equities, even as analysts cautioned that any renewed surge in energy prices could complicate the Bank of Canada’s policy outlook.
The rally was further underpinned by a pullback in oil prices after reports confirmed that tankers had successfully transited the Strait of Hormuz. Financials and technology stocks led the advance, with Shopify and BMO gaining 2.6% and 2.8%, respectively, as investors recalibrated their expectations for global interest rates ahead of upcoming Federal Reserve and Bank of Canada policy meetings. Energy heavyweights also remained in focus following a federal pledge to supply 23.6 million barrels of oil to the IEA.
