TORONTO — Stock markets in Canada and the U.S. rallied after President Donald Trump said the United States has talked with Iran about a possible end to the war.
“I do think there’s optimism that de-escalation in terms of the threat to do long-term damage to energy infrastructure, the fact that that threat’s off the table for a bit of time and there’s a chance of de-escalation is clearly giving markets an optimistic tone,” said Carol Schleif, chief market strategist at BMO Private Wealth.
The S&P/TSX composite index was up 566.40 points at 31,883.81.
In New York, the Dow Jones industrial average was up 631.00 points at 46,208.47. The S&P 500 index was up 74.52 points at 6,581.00, while the Nasdaq composite was up 299.15 points at 21,946.76.
Over the weekend, Trump had threatened to “obliterate” Iran’s power plants if it doesn’t open up the Strait of Hormuz within 48 hours. The narrow waterway off Iran’s coast has become a sore point for Trump because a sharp slowdown in traffic is preventing oil tankers from leaving the Persian Gulf to supply customers around the world.
Trump said Monday that he is postponing attacks on Iranian power plants for five days to allow talks to continue. Quickly afterward, though, came denials from Iran about talks, while Iran’s semi-official Fars and Tasnim news agencies portrayed the American president as backing down.
Colin Cieszynski, portfolio manager and chief market strategist at SIA Wealth Management, said in an early morning note that the comments from Trump spurred a “swift and radical shift in sentiment” on the markets Monday.
Meanwhile, Derek Holt, head of capital markets economics at Scotiabank, didn’t give much credence to Trump’s comments.
“I’ll leave you to decide whether it’s true that talks have evolved in such fashion, or whether Trump chickened out perhaps upon seeing markets or seeing Iran’s response, or whether someone benefited from the market swings etc,” he said.
“To say that U.S. foreign and domestic policy are in a state of utter chaos would be an understatement as uncertainty is being driven through the roof to the detriment of the economy and markets.”
Financial markets have had vicious swings, both up and down, since the war began because of uncertainty about how long it may last. The fear is that a long-term disruption could keep so much oil and natural gas off global markets that it creates a punishing wave of inflation for the global economy.
“The bigger impact here that people are trying to suss out, obviously, is the potential impact for oil … If higher oil prices last, it has the ability to impact inflation around the globe,” Schleif said.
However, she noted that North America is less energy dependent than it was during prior oil shocks.
The May crude oil contract was down US$10.10 at US$88.13 per barrel.
The April gold contract was down US$167.60 at US$4,407.30 an ounce.
The Canadian dollar was flat compared with Friday, trading at 72.90 cents US.
This report by The Canadian Press was first published March 23, 2026.
— With files from The Associated Press
Companies in this story: (TSX:GSPTSE, TSX:CADUSD)
Daniel Johnson, The Canadian Press