Futures tied to Canada’s main equity benchmark remained largely subdued on Wednesday as investors tracked the unfolding joint U.S. and Israeli military actions involving Iran and prepared for the release of fresh U.S. inflation data.
By 07:06 ET (11:06 GMT), the S&P/TSX 60 index standard futures contract was nearly unchanged, reflecting a cautious tone among traders who are monitoring how geopolitical developments could ripple through energy markets and broader economic growth.
Markets have been particularly attentive to the conflict in the Middle East, which participants fear could disrupt global oil supply flows and therefore weigh on growth prospects in energy-importing economies. The reaction to successive headlines out of the region has driven pronounced swings in oil prices this week, increasing sensitivity across the commodities-heavy Toronto Stock Exchange.
On Tuesday, the S&P/TSX composite index closed up 0.3% at 33,270.65. The session’s gain was underpinned by strength in metal mining names, helped by firmer gold prices, which offset weakness in energy stocks after oil retreated from earlier spikes.
U.S. futures and Wall Street picture
U.S. stock futures traded just above the flatline by mid-morning after earlier weakness. At 07:20 ET, Dow futures were trading about 41 points higher, or roughly 0.1%, S&P 500 futures were up 7 points, or 0.1%, and Nasdaq 100 futures had risen 16 points, also about 0.1%.
Major U.S. averages ended mixed in the previous session. The Dow Jones Industrial Average and the S&P 500 each eked out slight declines, while the tech-heavy Nasdaq Composite managed a small advance. Market participants were parsing a report that the International Energy Agency has proposed an unprecedented release from strategic oil reserves to try to counter the recent volatility in crude markets tied to the Iran conflict.
Brent crude, the global benchmark, was last trading up 3.1% at $90.53 a barrel, after earlier surging as high as $120 a barrel during the week. U.S. West Texas Intermediate futures were trading 3.3% higher at $86.17 a barrel. The report cited officials familiar with the situation saying the proposed release could surpass the 182 million barrels that IEA member nations made available following Russia’s 2022 invasion of Ukraine. IEA members were reported to be considering that proposal on Wednesday.
Analysts at ING cautioned that any release could blunt oil prices in the near term but described it as a "temporary measure," adding that "only military de-escalation can drive crude sustainably lower." They also suggested the move might be sending a "hidden signal" to markets that immediate expectations for a ceasefire are limited.
Geopolitical tensions were further amplified by reports that Iran had placed naval mines in the Strait of Hormuz in recent days. Following those reports, U.S. President Donald Trump warned that Iran could face strikes "at a level never seen before" if it did not remove the mines, amplifying concerns about the potential for further escalation and its implications for energy shipments.
"The geopolitical risk premium in oil has produced extraordinary volatility, with prices swinging dramatically as traders react to every headline around the Iran conflict," Lukman Otunuga, Senior Market Analyst at FXTM, said.
U.S. inflation reading in focus
Investors were also closely watching a key inflation release from the United States scheduled for Wednesday. Headline consumer price growth is expected to remain relatively muted on a month-on-month basis for February, though the outbreak of conflict in Iran has complicated the outlook for inflation due to higher gasoline prices stemming from the oil shock.
Economists surveyed expect the U.S. consumer price index to rise 0.3% month-on-month in February, compared with a 0.2% monthly gain in January. On an annual basis, CPI is forecast to match January’s pace of 2.4% for the 12 months to February.
When excluding volatile components such as food and energy, the so-called core CPI is projected to rise 0.2% month-on-month, down from a 0.3% increase previously, with moderating airfares and winter-related disruptions cited by analysts at Wolfe Research as contributors to the slowdown. On a year-over-year basis, core inflation is expected to remain at 2.5%.
Crucially, the published CPI numbers will largely not reflect the economic effects of the Iran conflict, which began with joint strikes against Tehran in late February. Gasoline prices in the United States have already risen in response to the oil price moves since the fighting started, a development that could feed through into inflation measures and potentially influence the Federal Reserve’s policy stance if the trend persists.
Oracle posts strong quarter, lifts guidance
In corporate headlines, Oracle’s quarterly results drove a sharp premarket move in its shares after the company beat expectations on both the top and bottom lines, citing robust demand in its cloud computing business and raising fiscal 2027 revenue guidance.
The company reported adjusted earnings of $1.79 per share on revenue of $17.19 billion for fiscal third quarter 2026, versus analyst expectations of $1.70 per share and $16.92 billion in revenue. Oracle’s cloud segment posted year-on-year revenue growth of 44%, totaling $8.91 billion.
Barclays analyst Raimo Lenschow commented that the results point to "a clearer path ahead" for Oracle, reflecting investor interest in the company’s pivot toward cloud infrastructure alongside its traditional database software and enterprise applications businesses.
Market watchers expected additional color on the broader software industry after the close when Netskope and UiPath were due to report quarterly results.
Gold retreats after earlier gains
Precious metals markets showed signs of recalibration as gold prices slipped back after an earlier intraday advance tied to the Middle East’s uncertainty. Spot gold fell 0.1% to $5,186.01 an ounce by 07:34 ET, while gold futures eased 0.9% to $5,193.46 per ounce.
Spot bullion had briefly pushed above the $5,000 to $5,200 per ounce trading band observed over the past week. The metal has experienced pronounced swings after retreating from a near $5,600 per ounce record high reached in late January.
Market implications
With the S&P/TSX’s composition skewed toward commodity-sensitive sectors, sudden shifts in oil and metals prices can rapidly alter sector leadership and index performance. Traders continue to balance the immediate signals from commodity markets and corporate earnings against looming macroeconomic data that could influence interest rate expectations.
Until there is clear military de-escalation or a decisive change in the supply outlook for oil, analysts and traders in commodity and equity markets are likely to respond to each new development in the Iran conflict, maintaining elevated volatility in energy-linked securities and related sectors.