The S&P/TSX Composite Index fell 0.9% to close at 35,490, as a renewed surge in oil prices reignited inflation concerns. Crude extended its rally after US President Donald Trump rejected Iran’s latest proposal to reopen the Strait of Hormuz, heightening fears that energy-driven inflation shocks could force interest rates to remain elevated for longer. Bond yields climbed in response, weighing on rate-sensitive sectors.
Financials declined, with both CIBC and National Bank slipping 1%. Weakness in precious metals also dragged on the broader market, as lower gold prices hit mining stocks: Agnico Eagle dropped 5.1%, Barrick fell 4.1%, and WPM lost 5%. By contrast, energy producers benefited from the rebound in crude, with Cenovus gaining 0.7% and Suncor advancing 0.9%.
Looking ahead, Tuesday’s Canadian GDP release will be closely watched for signs of underlying economic momentum and for guidance on the Bank of Canada’s next policy moves.