04:20 PM EDT, 05/21/2026 (MT Newswires) -- The resources-heavy Toronto Stock Exchange on Thursday rose to within 140 points of its record close, with commodities center stage as RBC said surging gold prices and inroads to foreign markets cushion Canada's exports from U.S. tariff pressures, while Scotiabank looked for the 'sweet spot price' on oil as the Iran war continues.

The S&P/TSX Composite Index closed up 247.67 points, or 0.7%, at 34,409.49, adding to the near 420 points gained yesterday when it recovered much of the 500 points lost over the two sessions leading in to that. The record close of 34,541.27 was set on March 2.

Most sectors were higher, led by Base Metals (boosted by gold) and the Battery Metals index, both up by more than 2%.

Energy did slip about 0.1% as West Texas Intermediate crude oil fell for a third day Thursday as the United States awaits Iran's response to it latest peace proposal, though reports said the Persian Gulf country will not agree to U.S. demands to end its nuclear program. WTI crude oil for July delivery closed down US$1.91 to settle at US$96.35 per barrel, while July Brent oil was down US$1.54 to US$103.48.

Gold had edged higher by midafternoon Thursday, moving up from early losses as the dollar and yields moderated despite an uncertain outlook for a peace deal between Iran and the United States. Gold for June delivery was up US$7.70 to US$4,543.00 per ounce after earlier touching US$4,488.30.

RBC published a note saying diversifying exports outside of the United States has emerged as a critical offset to tariff pressures for Canada with higher gold exports exaggerating gains from foreign markets.

Among highlights, RBC noted Canadian exports fared better than expected last year, declining by just 0.8% year over year on a nominal basis, with a rise in exports to non-U.S. markets, particularly the U.K., emerged as a counterbalance to weaker U.S. exports due to tariffs.

RBC said the caveat is that the non-U.S. export gains did not come primarily from diversifying exports in highly tariffed sectors. The increase had more to do with a price surge in gold exports, and the new TMX oil pipeline increasing export capacity outside of North America, it added.

Meanwhile, Olivier Gervais, Director, Modelling and Forecasting at Scotiabank, published 'The Sweet Spot Price: When Do Oil Prices No Longer Benefit the Canadian Economy?'

As a net oil exporter, Canada typically benefits from higher oil prices, but is there a point when the gains diminish or disappear?, asked Gervais in a note dated May 21.

Scotiabank results confirm that higher oil prices remain a net positive for activity at current levels, but the macro payoff diminishes as prices rise, Gervais said, adding Scotiabank finds evidence that once oil prices move into the US$120-US$130 range, in 2026 dollars, they no longer provide a statistically meaningful boost to Canadian activity.

But these estimates should be interpreted with caution, Gervais said. "Rather than a precise tipping point, this range is better viewed as an indicative zone where the positive relationship becomes markedly less clear," he added.