North America’s main stock indexes opened lower on Thursday, as U.S. President Donald Trump’ threats to escalate attacks on Iran dampened hopes for a swift resolution to the Middle East conflict.
At 9:31 a.m. ET, the Toronto Stock Exchange’s S&P/TSX Composite Index was down 1 per cent at 32,627.61
Oil prices climbed to around $110 a barrel on Thursday after President Donald Trump said the U.S. would continue attacks on Iran, stoking fears of prolonged disruptions to oil supply.
Brent crude futures were up US$7.96, or 7.9 per cent, to US$109.12 per barrel. U.S. West Texas Intermediate crude futures were up US$12.48, or 12.5 per cent, at US$112.60 per barrel, touching their highest since March 9 and heading for their biggest absolute price rise since 2020.
Still, both benchmarks remained below highs near US$120 a barrel touched earlier in the conflict.
“We’re going to hit them extremely hard over the next two to three weeks,” Trump said. “We’re going to bring them back to the Stone Ages where they belong.”
He gave no details on any steps that could lead to a reopening of the Strait of Hormuz.
Wall Street’s main indexes were also down in the last session of a holiday-truncated week.
The Dow Jones Industrial Average fell 96.4 points, or 0.21%, to 46,469.36. The S&P 500 fell 62.7 points, or 0.95%, to 6,512.61, while the Nasdaq Composite dropped 368.4 points, or 1.69%, to 21,472.523 at the opening bell.
During a closely watched address to the nation on Wednesday, Trump said military operations would be intensified in the next two to three weeks, in a sharp reversal from his earlier comments that the U.S. will be “out of Iran pretty quickly.”
“The problem is that we didn’t learn anything new. We’re back in a place where we know less, not more, about how we find an off ramp to this war,” said Art Hogan, chief market strategist at B Riley Wealth.
“The market is going to retrace some of the constructive action we saw over the last couple of days here.”
Earlier this week, markets were optimistic that an end to the war was near, putting Wall Street’s three indexes on track for their biggest weekly rise in four months, and the first week of gains in six.
Wall Street’s fear gauge, the CBOE VIX index rose to 27.54 points after falling to an over one-week low on Wednesday.
The month-long Middle East conflict battered global markets in March, with the S&P 500 and the Nasdaq logging their biggest monthly losses in a year, and Brent crude prices marking their strongest monthly performance on record.
Money market participants are no longer pricing in any easing from the Federal Reserve, per CME Group’s FedWatch Tool, as energy-driven inflationary concerns have clouded the central bank’s monetary policy outlook. They were anticipating two cuts before the conflict began.
Investor focus will be on developments around Elon Musk’s SpaceX, which confidentially filed for a U.S. initial public offering on Wednesday. The company is expected to target a US$1.75-trillion valuation, according to a Reuters report, citing two people familiar with the matter, which prompted a rally in smaller peers.
Rocket Lab, Planet Labs and Intuitive Machines rallied on Wednesday in anticipation of renewed investor interest in the space industry.
Meanwhile, data showed the number of new Americans filing for unemployment benefits fell to 202,000 for the week ended March 28, below estimates of 212,000, according to economists polled by Reuters.
Nonfarm payroll numbers are expected on Friday, but U.S. markets will remain closed for the Good Friday holiday.
Investors are also awaiting comments from Dallas Fed President Lorie Logan later in the day.
Reuters
