Market open and Canadian futures
Futures for Canada’s main stock index were trading higher in early Tuesday activity, underpinned in part by a rise in the price of gold and anticipation about further disclosures related to a framework peace agreement between the United States and Iran. At 07:18 ET (11:18 GMT), the S&P/TSX 60 index standard futures contract was up 6 points, representing a 0.3% advance.
The broader S&P/TSX composite index reached a fresh record high on Monday, led by gains among metal mining stocks. The benchmark closed the previous session at 35,275.64, a rise of 0.97%.
U.S. futures and recent session moves
Across the border, U.S. equity futures were also trading higher. By 07:29 ET (11:29 GMT), the Dow futures contract had inched up by 49 points, or 0.1%, S&P 500 futures were higher by 6 points, or 0.1%, and Nasdaq 100 futures had risen 91 points, or 0.3%.
Analysts at Deutsche Bank described markets as having "clearly stabilized" after the surge of optimism that followed the announcement of the deal the prior day.
In the previous session, the main U.S. averages advanced strongly after the announcement of a deal intended to conclude the more than three-month conflict in the Middle East. At the close on Monday, the Dow Jones Industrial Average had gained 469 points, or 0.9%; the S&P 500 had risen by 123 points, or 1.7%; and the Nasdaq Composite had jumped by 795 points, or 3.1%.
Iran deal timeline and comments from U.S. officials
President Donald Trump said the Strait of Hormuz would be fully reopened by Friday, the day representatives from Washington and Tehran are scheduled to meet in Switzerland to formally sign the interim peace agreement. Speaking in France at the start of a Group of Seven meeting, he said the strait, which had been effectively closed for weeks, was already "partially opened," adding, "Ships are starting to go out now, and on Friday it will be completely opened."
That timetable has not been free of uncertainty. Reporting cited senior U.S. officials who suggested it could take up to two weeks for shipping to return to normal operations. The timing for release of the document text has also been discussed; the president said the text would be published on Friday, while other officials indicated it could be released within two days.
Reports indicate that the memorandum of understanding accompanying the framework would include a 60-day extension of the current ceasefire and the lifting of an American blockade of Iranian ports. U.S. Vice President JD Vance, who is slated to attend the signing ceremony, warned that "there are a lot of very important details to figure out."
Oil and commodities reaction
Brent crude futures, the global oil benchmark, were lower as markets processed the deal and its potential to restore flows through the Strait of Hormuz. Brent was last down 2.7% at $80.94 a barrel, after plunging to three-month lows on Monday.
Gold moved higher on Tuesday as the decline in oil helped to temper inflation concerns. Spot gold was up 0.7% at $4,338.64 an ounce by 07:42 ET, while gold futures had climbed 0.2% to $4,358.70 an ounce. Bullion had surged more than 2% on Monday following the announcement of a preliminary agreement to end the conflict and reopen the strait, a development that reduced the immediate prospect of an energy-driven spike in inflation.
Analysts note that non-yielding assets such as gold typically perform worse in environments of higher interest rates; the easing of an energy shock can therefore weigh on yields and lift gold. At the same time, the U.S. dollar weakened a touch as risk sentiment improved; the dollar had been viewed as a relative safe haven during the conflict period.
Some strategists pointed out that, despite the oil sell-off, fundamentals supporting the dollar remained intact, citing strong economic data and the potential for Federal Reserve rate increases.
Central bank landscape and policy calendar
Market focus was shifting to the Federal Reserve as it began a two-day policy meeting later in the day. The Fed is widely expected to leave interest rates unchanged on Wednesday, with market attention concentrated on post-decision remarks from the Fed's newly named chair, Kevin Warsh.
Elsewhere, the Bank of Japan implemented a 25 basis point rate increase on Tuesday and signaled ongoing policy tightening to combat persistent inflation, while also announcing plans to scale back the pace of its monthly bond purchases in coming quarters. The Reserve Bank of Australia opted to keep borrowing costs steady but warned that it could raise rates again if needed, citing that both headline and underlying inflation remain too high.
Notable individual stock moves
In company-specific news, shares of SpaceX extended gains in after-hours trading after surging 19% in the second day of public trading. The company’s rapid ascent in market value has placed its capitalization in a range comparable to established large-cap technology and semiconductor names such as Alphabet, Apple, and Nvidia.
Implications for sectors and investors
The combination of easing energy-risk fears and stronger risk appetite supported commodity-linked Canadian equity sectors in the latest sessions, particularly metal miners that helped push the S&P/TSX composite to a record close. Energy markets reacted to the potential restoration of shipping through the Strait of Hormuz, weighing on crude prices, while precious metals benefited from shifts in real yield expectations. The central bank calendar, led by the Fed meeting, remains a key near-term focus for rates-sensitive sectors and fixed income markets.
What to watch next
- Release of fuller details on the U.S.-Iran framework and the formal signing in Switzerland.
- The Federal Reserve's rate decision and commentary from the new chair, which could influence rate expectations and currency moves.
- Further movements in oil and gold prices as markets calibrate the real-world timeline for reopening the Strait of Hormuz and potential oil flow normalization.
Investors will be parsing official text, central bank guidance, and commodity price action to assess persistence of the recent risk-on tone and how it filters through to equities and fixed income.