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Mining & Metals
Canada's Federal Gov't Projects a Smaller Deficit For FY2025-26 Than Previously Seen
Canada's federal government now projects a deficit in fiscal year 2025-26 of C$66.9 billion, down from a prior forecast of $78.3 billion, reflecting improved economic growth, it said in a spring economic update Tuesday.The deficit is set to gradually decline to C$56.2 billion by FY29-30, the government said.Projected GDP Growth is 1.1% in 2026, 1.9% in each of the next three years, and 1.8% in 2030, the governing Liberals said.
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International
TSX Closer: The Index Falls for a Fourth Day Ahead of the Spring Economic Update
The Toronto Stock Exchange closed lower on Tuesday, falling for a fourth-straight session on fading hopes for a deal to end to the Iran war, while investors awaited a spring economic update from the federal government for guidance on projected deficits over the short and medium term.The S&P/TSX Composite Index closed down 233.85 points, or 0.69% to 33,584.34, even with most sectors higher, led by Energy, up 2.4%, on elevated oil prices. But the biggest movers were also decliners, with Info Tech, down 4.4%, and Base Metals, down 3.6%, not helped by deflated gold prices.According to FactSet, the TSX going in to today was down 136.92 points or 0.40% over the three prior trading days. But month-to-date it was up 3.20% and year-to-date it was up 2,105.43 points or 6.64%.Canada's federal government will release its fiscal update just as the markets close at 4:00 p.m. ET on Tuesday, and Bank of Montreal in its morning note said it will be looking for it to showcase "better-than-expected" deficits.Robert Kavcic, senior economist at BMO Capital Markets, said: "There looks to be some fiscal upside compared to the $65.4 billion deficit estimate for FY26/27 heading into this update. Prior to the oil shock, finances were clearly running better than planned. The deficit was $25.5 billion for the April-to-February period (the first 11 months of the fiscal year), only slightly worse than $19.2 billion a year ago. While year-end adjustments can be hefty, there also looks to be meaningful upside to the estimated $78.3 billion shortfall for FY25/26 which could carry over to the coming fiscal year. The three main components were tracking better than budget estimates, with revenues rising modestly (versus expectations of a drop), interest charges drifting lower (versus expectations of a small rise), and program spending running below a budgeted rise of almost 7%."This extra room is likely why Ottawa hasn't been shy about rolling out some new measures ahead of this update. That includes the temporary removal of the excise tax on fuel, which will cost about $2.4 billion; a more generous GST rebate; as well as HST relief on new housing construction and the infrastructure deal with Ontario."Of commodities today, West Texas Intermediate closed higher, with the U.S. benchmark price flirting with the US$100 per barrel for the first time in three weeks as hopes for an end to the war on Iran fade and the Strait of Hormuz remains closed. WTI crude oil for June delivery closed up US$3.56 to settle at US$99.93 per barrel as it failed to hold the US$100 mark it topped during the session, while June Brent oil was up US$2.58 to US$110.81.But gold traded at a month low by midafternoon Tuesday as rising oil prices threaten to boost inflation and raise interest rates, while the dollar and treasury yields moved higher. Gold for June delivery was down US$82.80 to US$4,610.90 per ounce, the lowest since March 30.
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International
US Equity Markets End Lower as Chipmakers Slide, Middle East Tensions Lift Oil
US equity indexes closed lower on Tuesday as semiconductor shares fell and Middle East tensions lifted crude oil prices.* Arm Holdings (ARM), Applied Materials (AMAT), Lam Research (LRCX), Arista Networks (ANET), and Advanced Micro Devices (AMD) were among the tech decliners.* Iran's latest proposal to end the war in the Middle East failed to win President Donald Trump's support, Reuters reported, citing a US official.* The Conference Board's measure of consumer confidence rose to 92.8 in April from an upwardly revised 92.2 in March, compared with 89 expected in a Bloomberg survey.* The Richmond Fed's monthly manufacturing index rose to 3 in April from zero in March, above expectations for 1 in a Bloomberg poll.* May West Texas Intermediate crude oil rose $3.51 to settle at $99.88 per barrel, while June Brent crude, the global benchmark, was last seen up $2.90 at $111.13.* Alexandria Real Estate Equities (ARE) shares fell 11%, the biggest drop on the S&P 500, after the company reported lower Q1 results.* Centene (CNC) shares rose 13%, the top gainer on the S&P, after the company reported higher Q1 results and raised its 2026 outlook.
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