04:24 PM EDT, 04/29/2024 (MT Newswires) -- The Toronto Stock Exchange's S&P/TSX Composite Index closed up 42.38 points to 22,011.62 on Monday, rising for a fourth-straight session as mining issues pushed higher and investors moved to safety amid geopolitical tensions.

Battery Metals and Health Care were the biggest gainers, up 6.02% and 0.85%, respectively.

West Texas Intermediate (WTI) crude oil closed lower on Monday despite tight supply as investors turn cautious ahead of this week's Federal Reserve policy meeting that is expected to end with no change to interest rates while geopolitical risks are also easing. WTI crude for June delivery closed down US$1,22 to settle at US$82.63 per barrel, while June Brent crude, the global benchmark, closed down US$1.10 to US$88.40.

Gold traded higher mid-afternoon on Monday as the dollar and yields fell ahead of this week's meeting of the Federal Reserve's policy committee. Gold for June delivery was last seen up US$1.20 to US$2,348.80 per ounce, still down from the record close of US$2,413.80 on April 19.

Desjardins published a note on "Commodity Trends" in which it noted that tension in the MIddle East caused gold and oil prices to "surge."

Among highlights, Desjardins noted that when Iran attacked Israel a few weeks ago, the world held its breath. However, it also noted, the Israeli government's muted response and Iran's statement that there would be no further attacks unless it was provoked helped ease tensions in the Middle East.

WTI prices have dropped from US$88.34 per barrel on April 12 (the day of the attack) to US$85.00 per barrel at the time of writing. That said, geopolitical tension remains palpable, and last week's events were a direct confrontation in the world's biggest oil-producing region.

Supported by expected growth in oil demand, crude prices are also likely to continue to build in a risk premium, which will probably impact prices of refined products like gasoline.

According to Desjardins, uncertainty has once again pushed investors toward safe-haven assets like gold, which hit a record earlier this month. However, it said, the 17% year-to-date surge in gold prices isn't just a result of recent skirmishes in the Middle East.

Increased central bank gold reserves have also played an important role, it added, particularly in Europe and emerging Asia. Desjardins expects the price of gold to remain high in the near term.

Desjardins noted other commodities had a quieter month in March. Better-that-expected performance by China's economy - including its manufacturing sector - and "somewhat limited" global supply helped to underpin the price of copper, which increased faster than anticipated.

In contrast, China's property market contracted again in March, with sales and average home prices both falling, dampening further iron prices as the bank said it had anticipated.

Desjardins expects prices of all base metals - aluminum, copper, nickel and iron - to rise slightly by the end of the year as the global economic slowdown abates and more sustained growth returns.

However, it said, international aluminum and steel prices could be impacted by another increase in U.S. tariffs on Chinese exports.

Meanwhile, sentiment among those market watchers holding out for the start of interest rate cuts was likely crushed after a Macquarie economist published a note today entitled "Fed rate cuts no longer expected in 2024; will commence in 2025."

David Doyle, head of economics, said data leads the team at Macquarie to further push out its FOMC rate call. Macquarie no longer expects a rate cut in 2024 (it previously saw a 25bps cut in Dec.).

Macquarie's updated baseline is that rate cuts will only commence in 2025 when there is greater scope for YoY core PCE inflation to appear to be on a path back towards 2%.

"We continue to see risks to this as skewed in a hawkish direction with it becoming increasingly possible that the next policy change is a hike rather than a cut."

BMO, in its morning note, said that while the S&P 500 climbed 2.7% last week, the TSX eked out a 0.7% gain. Last week, BMO noted, the Bank of Canada's Summary of Deliberations (from the April 10 meeting) suggested that rate cuts will "probably be gradual, given risks to the outlook and the slow path for returning inflation to target."

Although BMO still expects the first rate cut in June, it now sees the second cut to come in September (previously July).

This week, BMO said, key data reports will give us more clues on how the economy is faring. On Tuesday, look for February's real GDP figures. BMO's Benjamin Reitzes noted momentum looks to be solid, led by mining/oil/gas and finance/insurance. "A firm increase in wholesale trade and small gain in manufacturing activity also look to contribute to growth. Retail and existing home sales were two likely soft spots. All told, we're looking for growth to clock in at a solid +0.3%, a tick below StatCan's flash estimate. That would keep Q1 GDP (we'll get an early estimate for the quarter as part of the release) on track for a strong increase of around 3% annualized. However, it looks like growth might have hit a wall in March, as generally weak early indicators point to a flash estimate of around flat or possibly even negative."

Elsewhere, Thierry Wizman, Global FX & Rates Strategist at Macquarie said fresh U.S. data prompted its U.S. economist to push out his projection on the start of the Fed's easing cycle to 2025 (from December 2024). Macquarie also doesn't rule out that the next change may be a hike, which would prompt a new wave of broad-based U.S. dollar strength.