The S&P/TSX Composite Index fell 373 points, or 1.0%, to 36,180.72 Monday, erasing four sessions of gains in a single day. Renewed fighting between the United States and Iran, the first direct exchange in over a month, sent oil higher and pulled industrial, technology and base metal shares down with it.
October crude oil rose $1.76 to $85.16 a barrel on the session. December gold fell $45.30 to $4,484.60 as a stronger US dollar offset safe-haven demand. Energy shares provided only a partial cushion against the broader decline, a pattern distinct from Wall Street, where energy was Monday's standout sector.
The Energy Trade Split Two Ways
In the United States, energy stocks rose roughly 2% Monday, the session's strongest sector, as Tesla jumped 5% and Nvidia added 1.5% even while Amazon, Microsoft, Alphabet and Apple declined. The Dow still fell 374 points to 53,185.90 and the S&P 500 lost 26 points to 7,686.14, because the same oil-driven inflation concern that lifted energy shares also pushed bond yields higher across the board.
The 10-year US Treasury yield climbed above 4.75% Monday, its highest level since January 2025, as traders priced roughly a 65% probability of a September rate increase from the Federal Reserve following hawkish comments from the Fed chair at Jackson Hole. Higher yields compress the multiple markets pay for growth stocks, which is why technology broadly lagged even as individual names like Tesla and Nvidia bucked the trend.
The chart below tracks the TSX composite through August's daily closes, showing Monday's drop against the four prior sessions of gains it erased.
The index gave back four sessions of gains in a single day as renewed US-Iran hostilities pushed oil higher and pressured industrial, technology and base metal shares.
What Tuesday's Futures Are Already Pricing
Two oil tankers were struck by projectiles in the Strait of Hormuz late Monday, extending the conflict into a second consecutive session of direct escalation. WTI crude added another 2.3% Tuesday morning to $87.75, and Brent climbed to above $92, building directly on Monday's move rather than reversing it.
Dow futures softened further in early Tuesday trading. For the TSX, the same dynamic that limited Monday's energy offset, a broad growth and yield concern layered on top of an oil rally, is still in place heading into today's session, and it now has Wednesday's Bank of Canada decision to absorb as well.
A TSX composite with a meaningfully heavier energy weight than the S&P 500 is better positioned to capture an oil-driven rally than a diversified US index. Monday showed that positioning is not automatic protection when the same headline pressures industrials, technology and base metals at the same time.