12:12 PM EDT, 08/26/2024 (MT Newswires) -- The Toronto Stock Exchange, which hit an intraday high 23,413, is now up 57 points to 23,344 at midday.

Energy, up 1.2%, is the biggest gainer, followed by miners (+0.6%).

Info tech, down 0.4%, is the biggest decliner.

Oil traded higher early on Monday on rising geopolitical risk as one of Libya's governments suspended exports while Israel and the Hezbollah militant group ratcheted up attacks, raising familiar concerns over a spreading Middle Eastern war.

Gold traded at a record high as treasury yields continued to weaken after Federal Reserve Chair Jerome Powell on Friday said the central bank is ready to start lowering interest rates to support a weakening labor market.

But natural gas prices moved lower on high supply and low demand as the hot summer temperatures ease and forecasts see cool weather on the way for most states.

BMO Economics said U.S. equity futures were pointing to modest gains at the open, "riding a wave of positive sentiment" following Fed Chair Powell's talk on Friday. In claiming "the time has come for policy to adjust", Powell "cemented expectations" for a September rate cut, though he remained coy on size. Still, BMO added, by noting the Fed does "not seek or welcome further cooling in labor market conditions", Powell left little doubt that another weak jobs report on September 6 could well warrant an aggressive start to the easing cycle. BMO said futures markets were still leaning slightly toward the smaller move, awaiting more data. For now, BMO remains in the quarter-point camp as well, with the view that the labour market is simply cooling from previous hot conditions, and the soft landing remains intact.

Meanwhile in Canada, BMO noted the highlight of the final week of the summer comes on Friday with June and second quarter GDP. According to BMO, Canadian economic growth likely edged up in Q2, with GDP expected to rise 2% annualized. That trails population growth by a wide margin, driving per capita GDP lower for a fifth straight quarter, BMO said. As rate cuts only started toward the end of the quarter, it will take time for the impact to feed through to activity. Meantime, BMO added, June GDP looks to come in about flat, a tick below the flash estimate. The bank noted manufacturing activity plunged, while wholesale softened and retail volumes were little changed. The broadly weaker backdrop was also reflected in the 0.4% drop in hours worked, and although higher home sales was "one bright spot", that only offset a small portion of the weakness elsewhere. BMO said the flash estimate for July is expected to be more encouraging with a decent rebound suggested by the bounce in the manufacturing and retail sales flashes and surge in hours worked. BMO doesn't expect anything in this report to change the calculus for the BoC at its September policy announcement with a 25 bp rate cut expected.

BMO noted global equities rallied last week as Fed rate cuts come into focus. The S&P (+1.5%) and Nasdaq (+1.4%) had "solid gains", while Europe was broadly firmer as well. The TSX climbed 1%, to an all-time high. BMO noted materials (+2.1%) and industrials (+1.8%) led the way higher, with financials (+1.6%) having a good week as well as bank earnings started (only TD in so far; the rest of the banks report this week). Only consumer staples (-2.4%) and energy (-0.3%) were down on the week.