Stock markets rallied in Canada and the U.S. after U.S. President Donald Trump called off a threat to bomb Iran, raising hopes for a deal between the countries. Kevin Burkett, portfolio manager at Victoria-based Burkett Asset Management, said Trump’s comments injected optimism into the market. “The tone really shifted when Trump announced he was not going to be advancing on his attack in Iran,” he said. Stocks immediately veered higher in midday trading after Trump said on his social media network that “discussions with the Islamic Republic of Iran have been brought to the highest level of Iranian leadership and approved” and that the time and place of a signing will “be announced shortly.” The S&P/TSX composite index was up 520.14 points at 34,671.46. In New York, the Dow Jones industrial average was up 929.97 points at 50,848.75. The S&P 500 index was up 127.31 points at 7,394.30, while the Nasdaq composite was up 640.16 points at 25,809.66. Burkett said markets have already seen cycles of threats and de-escalations since hostilities began in late February. “Markets appear to be pricing Trump’s rhetoric asymmetrically. Positive updates are treated as actionable signals, while negative updates are discounted as performance pressure or negotiation theatre,” he said. Burkett said that when markets reward hope more than they penalize risk, “the prudent response is not to chase the rally.” A deal to end the war with Iran could reopen the Strait of Hormuz and allow oil tankers to carry crude again from the Persian Gulf to customers worldwide. The July crude oil contract was down US$2.32 at US$87.71 per barrel. Worries had been high because the United States and Iran launched attacks over the past several days threatening a more than month-long tenuous ceasefire. Meanwhile, big swings for AI stocks have been yanking the U.S. stock market up and down over the last week, as they went from roaring to records to suddenly turning lower. The big concern is whether such stocks shot too high, too fast because of AI mania, and their careening moves have sometimes reversed direction by the hour. AI stocks had already been rolling back up their roller-coaster early Thursday, before Trump made his announcement on Iran. On the TSX, the basic materials and consumer cyclicals sectors added the most points to the overall index. Shares of Dollarama Corp. rose nine per cent after it reported results for the first quarter, which its chief financial officer characterized as “smooth,” even as war in the Middle East blocked key fuel shipping routes and posed challenges for retailers. Burkett said that as the Canadian economy continues to see pressure, particularly at the household level, discount stores are continuing to perform well. The Canadian dollar traded for 71.46 cents US compared with 71.79 cents US on Wednesday. The August gold contract was down US$19.30 at US$4,114.00 an ounce. --- Daniel Johnson, The Canadian Press With files from The Associated Press. This report by The Canadian Press was first published June 11, 2026.
