(RTTNews) – Canadian stocks surged on Thursday, partially reversing the losses from yesterday’s session, amid gains in the gold-linked materials sector while investors focused on how the latest U.S.-Iran crisis pans out following U.S. President Donald Trump’s mixed remarks.
After opening a little higher than yesterday’s close, today the benchmark S&P/TSX Composite Index traded positive throughout the session before settling at 35,200.45, up by 264.65 points (or 0.76%).
Five of the 11 sectors posted gains today, with the materials sector leading the pack.
After three separate attacks on ships transiting across the Strait of Hormuz on Monday, U.S. forces conducted two waves of strikes on Iran on Tuesday and Wednesday, hitting nearly 170 military targets. In retaliation, Iran struck U.S. bases in Kuwait and Bahrain.
Speaking about this fresh conflict, Trump called the ceasefire agreement signed between the U.S. and Iran on June 17 “over.” Trump also added that negotiating with Iran was a waste of time. However, Trump acknowledged that he allowed U.S. negotiators to continue the diplomatic process they are currently on.
Today, Trump stated that Iran is seeking a deal with the U.S. very badly but added that he was uncertain if Iran will honor any agreement.
While Trump’s position indicated an uncertainty on how he plans to resolve the crisis, experts are of the view that diplomatic measures would be given full chance.
Yesterday, the minutes from the U.S. Federal Reserve’s June month meeting revealed that the central bankers are leaning towards a hawkish stance. However, recent U.S. jobs data have eased concerns of an immediate rate hike by the Fed in July.
Crude oil prices sharply fell on expectations of a U.S.-Iran settlement and profit-booking from recent gains. As a result, the oil-linked energy sector tumbled today.
Gold prices moved higher and the gold-linked materials sector soared and pushed the Canadian index positively.
On July 1, the U.S. administration announced that it is opting to continue the Canada-United States-Mexico Agreement for free trade with annual reviews instead of an extension in its current form until 2036.
Canadian exporters are concerned that the U.S. may tweak the terms in its favor during annual reviews, forcing Canadian firms to readjust their contracts with their buyers and suppliers every year.
Last year, Trump imposed steep tariffs on Canadian exports to the U.S. The CUSMA deal allowed exporters to bypass those tariffs and after U.S. refusal to extend the deal, industries are now concerned of the impact on their margins.
In an effort to diversify the marketplaces for Canadian exports, Canada’s Prime Minister Mark Carney has been visiting various countries.
Wrapping up a week-long trip in the Middle East, today Carney is visiting Saudi Arabia to explore ways to deepen bilateral trade and investment.
There were no significant data releases today in Canada today.
In the U.S. today, the number of people filing for unemployment benefits was 215,000 for the week through July 4. These numbers came in lower than the upwardly revised 217,000 of last week.
Major sectors that gained in today’s trading were Materials (3.28%), Financials (1.00%), Consumer Discretionary (0.51%), IT (0.49%), and Industrials (0.06%).
Among the individual stocks, First Majestic Silver Corp (8.85%), Dpm Metals Inc (8.50%), G Mining Ventures Corp (8.08%), Trekor Metals Limited (7.95%), and Igm Financial Inc (1.92%) were the prominent gainers.
Major sectors that lost in today’s trading were Communication Services (0.16%), Real Estate (0.27%), Healthcare (0.54%), Utilities (0.58%), Energy (1.29%), and Consumer Staples (1.32%).
Among the individual stocks, Maple Leaf Foods (4.14%), Spartan Delta Corp (4.38%), International Petroleum Corporation (3.00%), Brookfield Renewable Partners LP (1.35%), and Curaleaf Holdings Inc (4.08%) were the notable losers.
