Canadian Stocks Inch Lower Amid Delay In U.S.-Iran Peace Deal, 'Project Freedom' Progress

Summary

(RTTNews) - Canadian stocks slid on Tuesday as a delayed U.S.-Iran peace agreement kept up the conflict tensions while investors focused on the ongoing U.S. initiative to free up locked ships in the Strait of Hormuz. After opening below yesterday's close, today the benchmark S&P/TSX Composite Index gained ground earlier but lost momentum and traded lower through the session before settling at 33,566.91, down by 71.96 points (or 0.21%). Nine of the 11 sectors posted gains today, with the healthcare sector leading the pack. After the U.S.-Israeli forces struck Iran on February 28, Iran commenced its military retaliation and also closed the Strait of Hormuz, the strategic waterway through which oil-and-energy tankers transit from Arabian countries to the rest of the world. Despite announcing a ceasefire, U.S. President Donald Trump disagreed with the peace proposals offered by Iran, and to force Iran to come to terms with the U.S. demands, Trump enforced a naval blockade on Iranian ports. The twin-blockade led to an enormous increase in oil prices. Stating that several countries requested U.S. help to free up their stranded vessels from the Strait of Hormuz, Trump launched "Project Freedom," an initiative to protect and safely escort the stranded ships out of the channel, since yesterday. Iran asserted it would attack any "foreign" forces in the strait including that of the U.S. Trump responded stating that Iranian forces would be wiped off the earth if they attack the U.S. ships. While U.S. Central Command mentioned that more than 100 aircraft and 15,000 service members are involved in the operation, its leader Admiral Brad Cooper strongly advised Iran to steer clear of the U.S. military assets. The U.S. military stated that two U.S. cargo ships crossed the Strait of Hormuz under the protection from guided-missile destroyers, among which one belonged to Danish shipping giant Maersk. The company stated that the transit was uneventful and all crew members were safe and unharmed. With the ceasefire ongoing, efforts by the U.S. to unblock the traffic through Hormuz strait boosted market sentiment. Iran's Foreign Minister Abbas Araghchi remarked that the political crisis cannot be handled with a military solution and added that the U.S.-Iran talks are making progress with Pakistan's effort. Israel's new chief of air force Major General Omer Tischler stated that Israel is ready to deploy its full fighter jet fleet against Iran if the situation escalates. Today, while speaking in the Oval Office, Trump reaffirmed that Iran is seeking negotiations contrary to its public stance. On May 3, Iran stated that it was reviewing the responses sent by the U.S. to Iran's proposal along with the U.S. plans for a framework to end hostilities. However, so far no update has been provided by Iran, which kept the Middle East tensions alive. Data released by Statistics Canada today revealed a trade surplus of C$1.80 billion in March compared to the downwardly revised trade deficit of C$5.10 billion in February. While exports rose 8.50% month-on-month to C$72.80 billion in March, imports fell 1.60% month-on-month to C$72.80 billion in March 2026 with declines in 8 of 11 product categories. The S&P Global Canada Composite Purchasing Managers' Index rose to 49.90 in April from 47.60 in March, nearing the neutral 50 threshold and signaling a stabilization in business activity. S&P Global Services PMI rose to 49.20 in April from 47.20 in March but remained below the 50.00 threshold for the sixth straight month. On the business front, Shopify reported its Q1 2026 earnings with a strong revenue increase to #3.2 billion, up 34% year over year, exceeding analyst expectations of #3.09 billion. Gross Merchandise Value reached $101 billion, growing by 35% year over year. Major sectors that gained in today's trading were Healthcare (2.51%), Consumer Discretionary (1.57%), Energy (1.36%), and Utilities (0.81%). Among the individual stocks, Curaleaf Holdings Inc (6.29%), Gildan Activewear Inc (2.99%), Restaurant Brands International Inc (2.15%), and Parex Resources Inc (4.95%) were the prominent gainers. Major sectors that lost in today's trading were Real Estate (0.61%) and IT (4.17%). Among the individual stocks, Colliers International Group Inc (5.61%), Altus Group Limited (2.48%), Firstservice Corporation (1.74%), Shopify Inc (15.63%), and Dye and Durham Limited (4.71%) were the notable losers. Ats Corporation (6.72%) and Ero Copper Corp (5.37%) were among the prime market-moving stocks today. The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.