Canadian Equities Remain Steady Despite Fresh U.S.-Iran Standoff

Index Update:

Canadian equities showed little movement Monday following the U.S. seizure of an Iranian vessel, which threatened the fragile two-week ceasefire and renewed fears of Gulf tensions and crude supply disruptions.

After opening below the previous week's close, today the benchmark S&P/TSX Composite Index regained ground early in the session but quickly lost the momentum. The index traded modestly lower for much of the day before gaining towards the end of the session and settling at 34,360.03, up by 13.74 points (or 0.04%).

Macro Update:

Data released by Statistics Canada today revealed that inflation came in a bit cooler than expected.

The headline inflation rate in Canada soared to 2.40% in March from 1.80% of the previous month, below expectations of 2.50%. The Consumer Price Index increased 0.90% in March over the previous month.

Canada's annual core inflation increased to 2.50% in March, while core prices increased by 0.20%.

Top Movers:

Among the individual stocks, Curaleaf Holdings Inc (11.23%), Blackberry Limited (13.12%), Docebo Inc (2.96%), and Parex Resources Inc (5.52%) were the prominent gainers.

Our Stance:

Momentum remains firm, with the 14-period RSI around 67.07, indicating steady upside strength while still leaving room before entering overbought territory. However, the broader trend continues to suggest consolidation, as price action lacks a decisive breakout.

Commodity Update:  

The U.S. dollar edged lower on Monday after the United States seized an Iranian cargo ship over the weekend, raising doubts about whether the temporary ceasefire between Washington and Tehran would continue. Currency traders also remained cautious before Tuesday’s hearing of Kevin Warsh, President Donald Trump’s nominee to replace Jerome Powell. In commodities, gold slipped 0.08% to USD 4,825.50, silver declined 1.01% to USD 79.23, copper eased 0.11% to USD 13,254.80, and Brent crude dropped 1.00% to USD 94.53 overnight.

Technical Update:

On Monday, the S&P/TSX Composite Index advanced 13.74 points (+0.04%) to close at 34,360.03, reflecting a modestly positive session with improving sentiment. From a technical perspective, the index continues to hold above its 21-period Simple Moving Average (SMA), which is acting as dynamic support and maintaining a constructive near-term bias. Momentum remains firm, with the 14-period RSI around 67.07, indicating steady upside strength while still leaving room before entering overbought territory. However, the broader trend continues to suggest consolidation, as price action lacks a decisive breakout. Immediate support is seen near 34,300, and a sustained move below this level could weaken sentiment, potentially exposing the index to a deeper pullback toward the 33,900 zone.