Canadian TSX stock index futures remain sluggish, with Iran conflict and U.S. inflation data taking center stage

Investing.com - On Wednesday, futures linked to major Canadian stock indexes underperformed as traders closely monitor developments in the Iran conflict and prepare for the upcoming U.S. inflation data.

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As of 07:06 AM Eastern Time (19:06 Beijing Time), the S&P/TSX 60 index futures remained flat.

Traders have been watching the rapid escalation of the joint U.S. and Israel attack on Iran, which could disrupt global oil supplies and impact economic growth worldwide.

Responses to Middle East news this week have caused sharp swings in oil prices, leading to tense market sentiment in the commodity-heavy TSX index.

On Tuesday, the S&P/TSX Composite Index rose 0.3%, closing at 33,270.65 points. Gains in metals and mining stocks were boosted by stronger gold prices during the session, offsetting declines in energy stocks after falling oil prices.

U.S. Futures Fluctuate

U.S. stock index futures hovered above flat after earlier declines. As of 07:20 AM Eastern Time, Dow futures rose 41 points, up 0.1%; S&P 500 futures increased by 7 points, up 0.1%; Nasdaq 100 futures gained 16 points, up 0.1%.

Major Wall Street indexes closed mixed on the previous trading day. The Dow Jones Industrial Average and the benchmark S&P 500 edged lower, while the tech-heavy Nasdaq Composite barely gained.

Market attention is on a Wall Street Journal report that states the International Energy Agency (IEA) has proposed releasing the largest strategic oil reserves ever to help stabilize recent oil price volatility caused by the Iran conflict.

Global benchmark Brent crude oil futures rose 3.1% to $90.53 per barrel, after soaring earlier this week to $120. Meanwhile, U.S. WTI crude futures increased 3.3% to $86.17 per barrel.

The WSJ cited officials saying the release would surpass the 182 million barrels provided by IEA members after Russia’s invasion of Ukraine in 2022. The IEA members are expected to decide on the proposal Wednesday.

Analysts at ING said that based on the scale of the reserve release, oil prices might be somewhat restrained in the coming days. However, they noted that the release would be a “temporary measure” and added, “Only a de-escalation of the military situation can sustain lower crude prices.” They also suggested that the IEA’s move could send a “hidden signal” to the market, indicating limited expectations for an immediate ceasefire.

U.S. President Donald Trump threatened to escalate attacks on Iran, following reports that Tehran recently laid mines in the Strait of Hormuz.

After CNN reported that Iran had laid mines in this strategic waterway (though not on a large scale), Trump said Tuesday that if Iran does not remove these mines, the country will face “unprecedented” strikes.

FXTM senior market analyst Lukman Otunuga told Investing.com, “Geopolitical risk premiums in oil are causing unusual volatility, with prices swinging sharply as traders react to every headline about the Iran conflict.”

U.S. Inflation Data Looms

Markets are focused on the U.S. inflation data due to be released Wednesday.

Expectations are for the overall U.S. consumer price index (CPI) to show a relatively moderate monthly increase in February, despite the Iran conflict casting a shadow over inflation prospects.

Economists forecast the CPI to rise 0.3% month-over-month, up from 0.2% in January. Over the 12 months ending in February, the CPI is expected to remain at a relatively moderate 2.4% growth rate, similar to January.

However, Wolfe Research analysts noted that, excluding volatile items like food and energy, the so-called “core” CPI is expected to increase by 0.2%, down from 0.3%, helped by easing airline ticket prices and winter weather disruptions. Year-over-year, this measure is expected to hold steady at 2.5%.

Importantly, these figures are unlikely to fully reflect the impact of the Iran conflict, which began in late February with joint U.S. and Israeli strikes on Tehran. U.S. gasoline prices have already risen, reflecting the increase in oil prices since the conflict started—potentially adding upward pressure on inflation and prompting the Federal Reserve to adopt a more hawkish stance.

Oracle Shares Surge Pre-Market

Oracle Financial Software reported quarterly revenue and profit that beat expectations, driven by strong growth in its cloud computing business, and expressed optimism about future revenue prospects amid the AI data center boom.

The company raised its revenue guidance for fiscal 2027, causing its stock to jump significantly in pre-market trading.

Based in Austin, Texas, Oracle has recently shifted focus toward cloud infrastructure, while its core products like database software and enterprise financial applications continue to generate revenue.

Oracle reported that in Q3 of fiscal 2026, adjusted earnings per share were $1.79 on revenue of $17.19 billion. Analysts had expected $1.70 per share and $16.92 billion in revenue.

Cloud segment revenue grew 44% year-over-year to $8.91 billion.

Barclays analyst Raimo Lenschow commented that the earnings report indicates a “clearer path forward” for Oracle.

After the market close, further insights into the impact of AI on the software industry may come as Netskope and UiPath release their quarterly earnings.

Gold Fluctuates

Gold prices edged lower, erasing earlier gains, as markets seek direction amid mixed signals from the U.S. and Israel regarding the Iran war.

As of 07:34 AM Eastern Time, spot gold fell 0.1% to $5,186.01 per ounce, while gold futures declined 0.9% to $5,193.46 per ounce.

Spot gold briefly broke through the past week’s trading range of $5,000 to $5,200 per ounce. Gold has been volatile since plunging from near its all-time high of around $5,600 in late January.

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