International
TSX Closer: The Index Gains as Gold Rebounds, Household Net Worth Climbs
The Toronto Stock Exchange closed with a gain on Friday as investors welcomed higher gold prices and assessed fresh data showing Canadian household wealth continued to grow in the first quarter despite volatility in financial markets.The S&P/TSX Composite Index closed up 266.39 points, or 0.77%, to 34,937.85, as strong gains in battery metals, base metals and financial stocks outweighed weakness in health care, technology and energy shares.Battery Metals Index led gainers, up 6.70%, with Base Metals, Industrials, Utilities, and Financial, up 2.21%, 0.60%, 0.07%, and 0.86%, respectively. Health Care led decliners, down 1.64%, with Information and Technology, down 0.99%, Telecom, down 0.12%, and Energy, down 0.48%.In commodities, gold traded sharply higher on Friday, rising off a seven-month low on expectations Iran is ready to sign a peace deal with the United States, promising to lower the high oil prices that have raised inflation and boosted the U.S. dollar and bond yields.Gold for July delivery was last seen up US$124.80 to US$4,238.80 per ounce after falling to the lowest since Nov. 20 a day earlier. The rise comes as U.S. President Trump on Thursday said he canceled planned attacks on Iran and said a peace deal with the country is near.For oil, West Texas Intermediate (WTI) crude fell for a second day on Friday, falling to the lowest in nearly two months on expectations the United States and Iran are near a deal to end their war and reopen the Strait of Hormuz. WTI crude oil for July delivery closed down US$2.83 to settle at US$84.88 per barrel, the lowest since April 17, while August Brent oil was last seen down US$3.11 to US$87.27.With the prospect of lower geopolitical tensions and a potential peace deal in sight between the United States and Iran, the US dollar (USD) sold off early Friday as the demand for safe havens cooled, said Rosenberg Research.Oil prices are responding to the possibility of a deal between the U.S. and Iran, as both Brent and WTI have pulled back by more than 4.0%, noted Rosenberg. The other currencies that are underperforming as things settle are the Canadian dollar and the Norwegian krone, two currencies that markets closely identify with oil price moves, stated Rosenberg.Beyond commodity markets, fresh economic data showed Canadian household wealth continued to grow in the first quarter despite volatility in financial markets. Household net worth rises in the face of volatile equity markets, said Statistics Canada in a statement on Friday.The net worth of Canadian households, the value of all assets minus all liabilities, rose 1.3% in the first quarter of 2026 to reach just over $18.6 trillion, as the value of both non-financial and financial assets increased in tandem. Following two consecutive quarterly declines, non-financial assets were up 1.1% in Q1, led by an uptick in the value of residential real estate. Financial assets increased by 1.3%.Household balance sheets added $148.0 billion in financial assets in Q1, and this gain was driven by net purchases of mutual fund units and higher valuations of domestic equities and investment funds amid easing valuations for foreign equity holdings, StatsCan noted.Meanwhile the seasonally adjusted stock of household credit market debt in Canada reached $3.25 trillion in Q1, the latest StatsCan data revealed. At the same time, the ratio of household credit market debt as a proportion of household disposable income increased for the sixth consecutive quarter, climbing by 0.9 percentage point to 179.6% in Q1. In other words, there was roughly $1.80 in credit-market debt for every dollar of household disposable income, the agency said.The household debt service ratio, measured as total obligated payments of principal and interest on credit market debt as a proportion of household disposable income, rose after two consecutive quarterly declines. The ratio finished Q1 at 14.75%, up from 14.68% in Q4 2025, as total debt payments rose 1.1% to outpace income, added StatsCan.The value of household residential real estate rose 1.3% to $8.47 trillion in Q1, despite a decline in real estate activity as measured by resales. According to the MLS House Price Index, the composite house price increased by 0.7% in the first three months of 2026; however, the number of resales declined by 8.4%. In contrast, StatsCan's New Condominium Apartment Price Index indicated that, since the first quarter of 2025, new condominium apartment prices have fallen by 5.9% in Toronto and by 2.9% in Vancouver. According to the Bank of Canada's Financial Stability Report, pressures in condominium markets, particularly in Toronto and Vancouver, have created challenges for condominium owners and investors.Besides, the household saving rate fell to 3.5% in Q1 as growth in disposable income (+0.6%) lagged that in nominal household spending (+0.9%). Households continued purchasing mutual fund shares in the first quarter of 2026, registering the third-largest acquisition (+$75.3 billion) on record and following the record-high investment in the fourth quarter of 2025 (+97.1 billion) StatsCan said. In 2025, households benefitted from record-high reinvested earnings through fund investment incomes and capital gains, while in the first quarter of 2026, households focused on record net investments in exchange-traded funds.Additionally, the Bank of Montreal (BMO) noted implications of the expected negative birth rate in the country. In Canada, demographic attention has been rightly focused on the massive influx and then capping of non-permanent residents, said BMO. However, a collapse in natural population growth has been unfolding in the background. Net births are expected to turn negative for the first time ever in 2028, stated BMO. That is, more Canadians will begin to pass away than will be replaced with new babies.According to the bank, there are many causes and many longer-term implications. Among the latter, the lower labor force and potential economic growth, lower break-even job growth rates, a role for artificial intelligence to drive more productivity, mounting stress on social security funding, and an evolving housing demand curve.
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