Bay Street, located in Toronto’s financial district, is pictured on Wednesday, March 18, 2020. (Credit: Nathan Denette/The Canadian Press)
Canada’s main stock index moved higher on Monday, closing in the green alongside Wall Street. This rally came even as tensions between Israel and Iran remained high, showing signs that investors are cautiously optimistic that the situation may not escalate further—for now.
The market reaction followed a weekend of heavy attacks. Israel struck military and energy facilities in Iran, including targets in Tehran. In response, Iran fired back with a wave of drones and missiles. The tit-for-tat attacks rattled investors on Friday, pushing oil prices up sharply due to fears of supply disruptions.
By Monday, however, markets appeared to calm.
“The initial shock has settled,” said Andrew Buntain, a portfolio manager at Fiduciary Trust Canada. “Investors are now in a wait-and-watch mode.”
While the conflict remains active, Buntain noted that traders are closely watching for any signs that the situation might worsen or lead to further damage to oil and gas infrastructure. The potential for escalation is still on the table, but with no major new developments, markets took a breather.
Oil Drops, Tech and Industrials Rise
As fears eased, oil prices began to drop again, pulling energy stocks down with them. Yet the S&P/TSX composite index still managed to close up by 64.26 points, landing at 26,568.61.
Sectors like technology, industrials, and base metals helped push the index higher, even as energy and gold-related stocks slid. Gold prices also fell, taking a toll on mining shares. But despite the daily dip, the materials sector remains one of the TSX’s strongest performers in 2025.
“Gold shares dipped today, but they’ve been solid performers this year,” said Buntain. “With ongoing global instability, gold still looks like a potential profit-maker in the coming months.”
U.S. Stocks Follow Suit with Strong Gains
Wall Street followed a similar trend. In New York:
- The Dow Jones Industrial Average gained 317.30 points, closing at 42,515.09.
- The S&P 500 rose 56.14 points to 6,033.11.
- The Nasdaq Composite surged 294.39 points to 19,701.21.
Investors appeared encouraged by signs that global markets weren’t spiralling, even amid the tense geopolitical backdrop.
Canadian Dollar, Commodities Shift
The Canadian dollar also saw a minor boost, trading at 73.76 cents US, up from 73.54 cents US last Friday.
On the commodities front:
- Crude oil (August contract) dropped by US$1.04, settling at US$70.25 per barrel.
- Natural gas (July contract) rose by 17 cents to US$3.75 per mmBTU.
- Gold (August contract) fell US$35.50 to US$3,417.30 an ounce.
- Copper (July contract) inched up by three cents, reaching US$4.84 per pound.
