TSX Futures Edge Higher as Investors Weigh Middle East Tensions, New U.S. Tariffs

Futures linked to Canada’s main stock index edged higher on Friday morning, though gains were capped as investors navigated heightened geopolitical risks in the Middle East and a new round of U.S. trade tariffs. As of 7:12 a.m. ET, the S&P/TSX 60 index standard futures contract had risen by 7 points, or 0.3%.

Geopolitical Tensions Rattle Markets

Investor sentiment remains heavily influenced by the escalating conflict between the U.S. and Iran. On Thursday, Wall Street retreated after Iran-backed Houthi militants attacked Saudi tankers in the Red Sea, causing the global benchmark Brent crude futures to briefly surge above $100 a barrel.

The spike in oil prices has intensified concerns about a potential burst of energy-driven inflation, which could compel central banks to tighten monetary policy. "The continued rise in energy prices is starting to put pressure on financial markets more broadly," said Jonas Goltermann, Chief Markets Economist at Capital Economics, in a note. Tensions remained high after the U.S. military confirmed a 13th wave of strikes on Iranian targets early Friday, and The New York Times reported that Iran had rejected a U.S.-backed ceasefire proposal.

U.S. Announces Widespread Tariffs

Adding to market uncertainty, the Trump administration on Friday imposed new double-digit tariffs on imports from 60 countries. The levies, which range from 10% to 12.5%, replace a global 10% tariff that had expired.

Ad

The White House stated the new charges are necessary because trading partners have not adequately enforced bans on goods produced by forced labor. Notably, major U.S. trading partners, including Canada and the European Union, are subject to 10% tariffs under the new arrangement. The administration is using a section of a 1974 U.S. trade act as justification for the measures.

Market Snapshot

The modest rise in futures follows a down day for the Canadian market. On Thursday, the S&P/TSX composite index closed lower by 0.8% at 35,192.66, pulling back from a record high set in the previous session.

U.S. stock futures also pointed to a higher open on Friday, attempting a recovery from Thursday's sell-off. In commodities, gold prices inched higher, supported by the geopolitical uncertainty. Meanwhile, mixed U.S. tech sector earnings this week have also been a focus for investors, with disappointing reports from Alphabet and Tesla weighing on sentiment, while strong results from Intel provided a bright spot.