Global stocks were mixed as investors balanced enthusiasm around the artificial intelligence-driven rally against renewed geopolitical tensions in the Middle East that pushed oil prices higher. Wall Street futures were modestly positive after major North American markets ended Friday in the green, while TSX futures also pointed higher. In the United States, investors were awaiting earnings from Hewlett Packard Enterprise as attention shifted toward a busy week of economic data.
Market sentiment remained fragile as traders weighed the possibility of progress in negotiations involving Iran and the United States aimed at ending the conflict in the Middle East and reopening the Strait of Hormuz, a crucial energy shipping route. XTB research director Kathleen Brooks said markets were still holding onto hopes that a deal could emerge even after attacks from both sides, but warned that any delay could weaken sentiment. The prospect of renewed disruption in the region continued to hang over equities and commodities.
European markets were lower overall, with the pan-European STOXX 600 down 0.8 per cent. Britain’s FTSE 100 fell 0.83 per cent, Germany’s DAX was nearly unchanged and France’s CAC 40 slipped 0.07 per cent. In Asia, the tone was stronger. Japan’s Nikkei advanced 0.91 per cent and Hong Kong’s Hang Seng gained 0.86 per cent.
Oil prices climbed sharply as tensions escalated. Brent crude rose 3.7 per cent to US$94.53 a barrel, while West Texas Intermediate increased 4.3 per cent to US$91.23. Analysts said concerns were rising about possible mines in the Strait of Hormuz, which could complicate efforts to restore normal shipping flows even if a diplomatic agreement is eventually reached. IG analyst Tony Sycamore said any reopening would likely be gradual and would not immediately flood the market with supply.
Gold prices weakened as investors rotated toward riskier assets and energy markets. Spot gold fell 0.7 per cent to US$4,506.49 an ounce, while August gold futures dropped 1.2 per cent to US$4,536.70.
In currency markets, the Canadian dollar softened against the U.S. dollar. The loonie traded between 72.25 and 72.52 U.S. cents in early trading and was down about 1.45 per cent over the past month. The U.S. dollar index rose 0.16 per cent to 99.06. The euro slipped 0.13 per cent to US$1.1646, while the British pound edged up 0.07 per cent to US$1.3464. U.S. 10-year Treasury yields last stood at 4.462 per cent.
Among corporate developments, Finnish on-road load-handling equipment maker Hiab said it will acquire Quebec-based garbage truck manufacturer Labrie Environmental Group for about US$1 billion. Separately, Cogeco Communications and Cogeco said they expect to book a non-cash impairment charge of about $1.7 billion tied to their U.S. telecommunications operations.
Investors are now awaiting a series of major economic releases, including manufacturing PMI readings from China, Japan, the euro zone, Canada and the United States, along with U.S. construction spending data and remarks from Bank of Canada Senior Deputy Governor Carolyn Rogers.
