Bay Street May Open On Weak Note

(RTTNews) - The Canadian stock market looks headed for a weak start Tuesday morning amid rising tensions in the Middle East following continued strikes by the U.S. against Iran, and reimposition of a blockade of Iranian shipping along the Strait of Hormuz.

The U.S. President proposed a 20% fee to guard the Hormuz Strait.

Investors will be reacting to earnings updates from some big-name U.S. companies and will also be looking ahead to the Bank of Canada's interest rate decision due on Wednesday.

Goldman Sachs, Bank of America and JP Morgan have reported higher earnings for the second quarter.

In Canadian earnings news, PrairieSky Royalty Ltd. said its second-quarter bottom line came in at C$95.4 million, or C$0.41 per share, compared with C$56.3 million, or C$0.24 per share, last year.

The Canadian market closed lower on Monday as plunge in the metal-linked materials sector due to a decline in gold prices outweighed the surge in the oil-linked energy sector due to a sharp jump in crude oil prices after Iran shut the Strait of Hormuz once again.

The benchmark S&P/TSX Composite Index gained early in the session but lost momentum and traded negatively throughout the rest of the day before settling at 35,252.72, down by 52.59 points or 0.15%.

Asian stocks ended mostly higher on Tuesday, reversing early losses as upbeat Chinese trade data helped offset concerns over escalating military clashes between the United States and Iran.

Brent crude prices jumped nearly 3 percent toward $86 a barrel, bringing gains for the week to more than 10 percent after U.S. President Donald Trump reimposed a blockade on Iranian ships transiting the Strait of Hormuz and proposed to impose a 20 percent fee on all cargo passing through the vital waterway for guarding it.

The major European markets are trading weak today amid concerns about inflation and interest rates as oil prices climbed higher following an escalation in tensions between Iran and the U.S.

West Texas Intermediate crude oil futures are up $1.95 or 2.5% at $80.09 a barrel.

Gold futures are up $28.60 or 0.71% at $4,034.30 an ounce, while Silver futures are up $0.438 or 0.76% at $58.410 an ounce.