The S&P/TSX Composite closed at 35,703.47 on September 14, down 3.4% from its August 25 high of 36,957.63. The two moves inside that stretch tell the story: a steady summer grind lower through late August and early September, then a 1.11% single-day drop on September 10, the day Saudi Arabia's East-West pipeline was struck and shut down, before the index stabilized at essentially flat over the following two sessions.
The Sector Split the Headline Number Hides
Energy has done its job. Canadian Natural Resources, Tourmaline Oil and Suncor Energy have each posted gains through this stretch as WTI crude climbed 25% in three weeks on the Strait of Hormuz closure and the loss of Saudi Arabia's pipeline workaround. That is exactly the read-through a Canadian, energy-weighted index should show when oil rallies on supply disruption.
The composite has fallen anyway. Technology names have weighed on the index through the same window, pressured by AI development slowdown concerns that have nothing to do with the Middle East. The two forces have been roughly offsetting through most of the period, with the index net negative because the technology weakness has, on most days, outrun the energy strength rather than the reverse.
Why the Fed Meeting Matters More Than Usual This Week
Canadian August CPI held at 3.0% year over year, with gasoline inflation at 22.8%, elevated enough that the Bank of Canada held its own policy rate at 2.25% on September 2 rather than cutting. The U.S. Federal Reserve decides Wednesday with markets pricing roughly 87 to 88% odds of a hike, a reversal of its 2025 easing cycle driven by the identical oil-price pass-through into U.S. inflation. A Fed hike this week adds pressure to rate-sensitive sectors across North American markets at the same moment Canadian technology names are already absorbing AI-related selling, a combination that argues for continued index-level softness even if energy keeps climbing on the commodity.
The index's steepest single-day decline of the period, 1.11%, landed on September 10, the day Saudi Arabia's East-West pipeline was struck, even as the underlying oil price move that day favoured Canadian energy weighting. Source: Investing.com.
What to Watch Into the Close
Two data points will move this index in the next 24 hours: the Fed's rate decision Wednesday afternoon, and whichever direction the Saudi pipeline story breaks next. A hike alongside continued pipeline disruption would put technology weakness and energy strength on a collision course again, with the outcome for the index depending on which force dominates that specific session. A pipeline restoration, by contrast, would likely cool the energy trade faster than it would resolve the Fed-driven pressure on technology, arguing for continued index softness even in a de-escalation scenario.