Holiday: There will be no Daily Snapshot on Friday, April 3, 2026, in observance of Good Friday.

• Markets reverse losses on hopes of a reopening in the Strait of Hormuz –Bonds and equities shook off a weak start to today's session to close higher, helped by building hopes that the Strait of Hormuz could at least partially reopen. These encouraging signals had little effect on spot oil prices, which remain elevated at $112 per barrel but pushed down expectations for prices later in 2026, according to forward markets. In response the S&P 500 index finished 0.1% higher, while the Nasdaq and Russell 2000 delivered larger gains. U.S. government bond markets were down at market open, but rebounded through the day with yields closing lower. The dollar strengthened against a basket of trade-weighted currencies, and gold prices moved lower.
   
• President Trump strikes a combative tone – Hopes for a de-escalation in the conflict in Iran had built this week after comments from President Trump that the military campaign would be over shortly, and that the U.S. could step back even if it has not secured a deal to reopen the Strait of Hormuz. However, the president's address to the nation last night provided little clarity on what an off-ramp might look like, and, if anything, warned of further escalation in the short term at least. There was a reference to ongoing discussions with Iranian leadership, but little detail, and the president signaled that the U.S. bombing campaign would continue, if not intensify. Market concerns over these headlines were calmed by news that Iran is drafting a protocol with Oman to monitor traffic through the Strait of Hormuz. The prospect of increased oil flows through this important waterway is an encouraging step, but uncertainty remains high around a path to a fuller reopening.
   
• A health check heading into the energy shock – Tomorrow's nonfarm-payroll report for March will provide a timely check-in on the health of the U.S. labour market in the early innings of the oil shock. The February reading showed a disappointing 90,000 decline in payrolls, although we suspect this was at least partly driven by strike action and seasonal dynamics in early 2026. March should show some rebound, in our view, with the Bloomberg economist consensus penciling in a solid 75,000 rise in payrolls over the month. Other labour-market indicators look consistent with this forecast, with initial unemployment insurance claims low, ADP private sector employment accelerating slightly, and survey data pointing to still solid labour-market dynamics. The risk stands that higher energy costs and rising uncertainty over the outlook could further discourage hiring and push unemployment higher. However, such a deterioration would likely take time to materialize and require a larger and more prolonged oil price spike, in our view.

James McCann ;
Investment Strategy

^{Source for all data: Bloomberg.} 

• Stocks add to the rally on optimism that the end of the war is near - Major equity indexes begun the new month and quarter on a higher note, adding to yesterday’s TSX rally, the strongest since April 9, 2025. The move has been supported by U.S. President Trump’s comments suggesting that the war with Iran could be over within two to three weeks, with the U.S. potentially stepping away regardless of whether a deal is reached with the current regime. The U.S. president is scheduled to deliver a national address tonight focused on Iran. While details remain unclear, markets appear to be pricing in a degree of de-escalation. WTI crude oil prices dropped slightly below $100 per barrel, down about 1.8% from yesterday on the news, although traffic through the Strait of Hormuz remains near a standstill. Meanwhile, Canada and U.S. government bond yields rose after recent U.S. economic data surprised to the upside.
   
• U.S. economic data highlight solid trends heading into the energy price spike - February U.S. retail sales rose 0.6% month-over-month, exceeding consensus expectations for a 0.5% gain and accelerating to the highest pace since July 2025. Control group retail sales, which better capture core consumer spending trends and feed directly into GDP, also increased a strong 0.5%. Together, the data help reinforce the narrative of a resilient consumer heading into the March headwind from sharply higher gasoline prices. On the employment front, U.S. companies added more jobs than expected last month, with private payrolls increasing by 62,000 versus expectations for 40,000, suggesting the labour market may be stabilizing. Most of the private sector hiring was still led by the education and health services sectors, which have been responsible for the majority of job creation in the last year. Pay growth for job-stayers was unchanged for the third month at 4.5%, while pay growth for job-changers accelerated to 6.6% from February's 6.3%.
   
• Diversification helped portfolios better weather first-quarter volatility – While the TSX benefited from the resource-heavy tilt, most major U.S. indexes declined in the first quarter, a period marked by headline-driven volatility and shifting market leadership. Early in the quarter, stocks traded within a narrow range before breaking down amid escalating conflict in the Middle East and the resulting energy supply shock. The S&P 500 posted a quarterly decline after three consecutive quarters of gains. Notably, however, the equal-weight S&P 500 finished the quarter in positive territory, as did small- and mid-cap stocks. Overseas equities also outperformed in Canada-dollar terms, with emerging-market stocks ending the quarter with a slight gain. Beneath the surface, key themes included continued AI-driven disruption, a rotation away from mega-cap technology stocks, and a reduction in expectations for Federal Reserve rate cuts. Energy and materials led the TSX, while technology and real estate sectors lagged. As we turn the page to the second quarter, much of the headline uncertainty remains. That said, we believe relatively steady economic growth and rising earnings can provide support, with diversification continuing to help smooth periods of market volatility.

Angelo Kourkafas, CFA ;
Investment Strategy

^{Source for all data: Bloomberg.} 

• Stocks trade higher on hopes for an off-ramp to the conflict in Iran – North American equity markets traded higher on Tuesday, supported by reports that U.S. President Trump stated he is willing to end military operations in Iran, even if the Strait of Hormuz remains closed. From a leadership perspective, most sectors of the S&P 500 finished the day in positive territory, led by technology and communication services, which each gained over 4%. Strong performance in these sectors led to a 3.8% gain in the Nasdaq, while the TSX and S&P 500 notched gains of 2.5% and 2.9%, respectively. Bond yields closed modestly lower, with the 10-year Government of Canada yield at 3.44% and the 10-year U.S. Treasury yield at 4.32%. While optimism around a potential off-ramp to the conflict provided support for equity markets, oil prices were only modestly lower and remain above $100 per barrel, reflecting continued uncertainty surrounding the timing and path to reopening the Strait of Hormuz. On the economic front, Statistics Canada reported that real GDP rose by 0.1% in January, modestly exceeding the initial estimate that had called for a flat reading. Meanwhile, the advance estimate for February points to monthly growth of 0.2%.
   
• Markets remain headline-driven – Developments related to the conflict in Iran continue to be the primary driver of market performance. Most recently, reports suggest the U.S. may be willing to end its military operations in Iran, even if the Strait of Hormuz remains largely closed. Equity markets have responded positively on optimism around a potential near-term off-ramp, while bond yields have moved lower. However, uncertainty persists following reports that Iran struck an oil tanker off the coast of Dubai. In addition, oil tanker traffic through the Strait of Hormuz has slowed to a crawl, and the timeline and path for reopening remains uncertain. Reflecting these risks, oil prices were only modestly lower on Tuesday, with crude oil still holding just above $100 per barrel. We expect markets to remain sensitive to conflict-related headlines in the coming weeks, and volatility may persist. That said, we believe the recent pullback in equity markets could create attractive opportunities for long-term investors. In our view, U.S. equities appear well positioned, supported by healthy profit growth, continued investment in artificial intelligence (AI), and resilience in the U.S. economy. We also see opportunities in overseas developed small- and mid-cap equities, which we believe offer relatively attractive valuations, as well as in emerging-market equities that could benefit from sustained enthusiasm around AI.
   
• U.S. labour-market data in focus – U.S. labour-market data will be in focus for investors for the remainder of the week, with JOLTS job openings for February in line with expectations this morning, ADP employment data for March due Wednesday, and the March nonfarm-payrolls and unemployment report scheduled for Friday. Labour-market conditions have eased from the historically tight levels seen in the immediate post-pandemic period but remain healthy, in our view. Conditions are characterized by modest job growth and limited signs of elevated layoffs. Reflecting this trend, nonfarm-payroll growth slowed to a three-month average of roughly 6,000 jobs as of February. However, indicators of job losses remain contained, with the unemployment rate holding at 4.4% and initial jobless claims averaging 213,000 in 2026—well below the 30-year average of more than 300,000. We expect modest job growth in the U.S. to persist through 2026. Coupled with low levels of layoffs and slowing labour-force growth—potentially reflecting tighter immigration policy—we believe the U.S. unemployment rate is likely to remain contained around 4.5%. In our view, this backdrop should remain broadly supportive of household spending.

Brock Weimer, CFA ;
Investment Strategy

^{Source for all data: FactSet.} 

• Markets start the week lower on higher energy prices – The TSX and U.S. equity markets gave back earlier gains to close lower on Monday, as weakness in technology and industrials weighed on performance. In international markets, Asia was down overnight, while Europe rose as economic and consumer confidence data for March came in roughly in line with estimates. The U.S. dollar strengthened, likely supported by its liquidity and perceived stability as the global reserve currency. While we acknowledge near-term geopolitical uncertainty and market volatility, we see opportunities across markets and asset classes. Within equities, we favour U.S. large- and mid-cap stocks, which we believe should benefit from their quality, technology exposure and broadening leadership. We also see potential in international developed small- and mid-cap equities, supported by global economic resilience and relatively attractive valuations. Emerging-market equities may also offer opportunity, as they have historically performed well during Fed easing cycles and can offer meaningful exposure to technology innovation. At a sector level, we favour the energy, industrials and materials sectors, offset by underweight positions in communication, consumer discretionary, consumer staples and technology as part of our opportunistic equity sector guidance. Within fixed income, international bonds can add diversification through exposure to different economic and interest-rate cycles, while emerging-market debt may also enhance income.
   
• Oil prices extend their rise – In energy markets, WTI oil climbed above $104 per barrel for the first time since 2022 amid ongoing disruptions in the Strait of Hormuz. Despite the recent rise, U.S. and Canadian rig counts have dropped in recent weeks*. That likely reflects producer caution and reluctance to materially increase drilling activity in response to what could still prove to be a short-term shock. Energy futures imply WTI oil prices may retreat toward the mid-$70 range by year-end, potentially reinforcing this concern.
   
• Bond yields edge lower – Bond yields declined from recent highs, with the 10-year Government of Canada yield at 3.52% and the 10-year U.S. Treasury yield near 4.35%. Most of the increase since the February lows has been tied to the prospect that higher inflation — partially influenced by rising oil prices — could delay Fed rate cuts. Markets have pushed back the implied timing for the next rate cut out to late 2027**, a materially slower pace of easing than the Fed's latest projections, which indicate one cut this year, followed by another next year***. A smaller portion of the recent rise reflects higher inflation expectations, a key component of bond yields. We think the Fed remains in its easing cycle, though the path will likely be more gradual. In our view, the steady labour backdrop should allow policymakers more time to confirm that the Fed's preferred inflation gauge — the personal consumption expenditures (PCE) price index — is easing sustainably toward the 2% target before proceeding with additional cuts. We think the Bank of Canada will remain on hold in the near term with its policy rate at the low end of the bank's 2.25%-3.25% estimate for neutral rates. On a positive note, higher yields improve income potential, the primary driver of bond returns. In addition, any easing in inflation expectations could lift bond prices, which move inversely to yields.

Brian Therien, CFA ;
Investment Strategy

^{Source for all data not cited: FactSet. Source for data cited: *Baker Hughes **CME FedWatch ***U.S. Federal Reserve}