Tag: Geopolitical

Bank of Canada Hikes as Loonie Firms, Nasdaq Stumbles

The week’s defining move was domestic: the Bank of Canada raised its overnight rate target to 2.5%, prompting the major banks to lift prime rates and sending the Canadian dollar higher against both the US dollar and the euro even as the S&P/TSX Composite slipped. Markets absorbed the decision calmly, with prediction markets now leaning toward a December hold, while south of the border a resilient US growth and labour data set collided with a sharp Nasdaq pullback and persistent Iran and Russia-Ukraine headlines that left oil and gold moves surprisingly muted. For Canada, the stronger currency and steadier policy outlook offer some support to rate-sensitive sectors heading into a heavy week of earnings from Enbridge, Canadian Natural Resources and BCE. The coming week hinges on US data, payrolls, CPI and PPI, that will test whether growth resilience or equity repricing wins out, with Nasdaq support, Hormuz oil risk, USD/CAD and gold’s retreat from 4,000 as the levels to watch.

The Week in Brief

Canadian markets closed the week lower, with the S&P/TSX Composite off 0.47% to 35,620.00, a milder decline than the drag seen in the United States but one that still reflects a cautious global tone. The Canadian dollar actually firmed against both the US dollar and the euro, with USD/CAD down 0.28% to 1.3973 and EUR/CAD down 0.80% to 1.5591, a move that followed the Bank of Canada’s rate increase to 2.5% and a subsequent round of prime-rate hikes at the major banks. South of the border, the Nasdaq bore the brunt of the selling, down 2.00% to 25,437.00, while the S&P 500 slipped 0.57% to 7,580.07. Europe moved the other way entirely: the Euro Stoxx 50 gained 1.04% and the STOXX Europe 600 rose 1.73%, a divergence from North America that investors will want to watch into next week. The US 10-year yield fell 5.9 basis points to 4.929%, consistent with the softer tone in equities even as gold, often a safe-haven beneficiary, fell 2.72% to 3,898.90 and the VIX was little changed at 19.42. Geopolitics stayed active in the background, with Iran-related headlines continuing through the week, including warnings from Iran’s security chief about revisiting its nuclear weapons ban if war resumes, alongside reports of oil tankers hit in the Strait of Hormuz. On the Ukraine file, an evacuation from the Russian-occupied town of Oleshky and a joint humanitarian convoy point to continued, if partial, de-escalation on the ground, even as the broader conflict clusters remain unresolved. For a Canadian investor, the currency strength and the Bank of Canada’s move are the week’s clearest domestic signals, set against a US equity pullback led by technology and a European equity market that held up noticeably better.

By Atlas

Geopolitics and Markets

The Iran file remained the week’s most persistent geopolitical thread, with reports of oil tankers hit in the Strait of Hormuz, oil spills reaching the UAE coastline, and Iran’s security chief warning the country could revisit its nuclear weapons ban if war resumes. Despite that string of headlines, WTI crude rose only 0.82% over the week to 104.12, a measured move given the severity of the reporting, and gold fell 2.72% to 3,898.90, a decline that sits awkwardly against the usual safe-haven script and suggests other forces, including the stronger US dollar index, up 0.07% to 101.88, were doing more to set the tone in bullion. Iran’s supreme leader also warned the US and Israel against war, while reports surfaced that Iran expects to receive Russian Su-35 jets after any conflict ends, a detail that keeps the Russia-Iran relationship in view for defence and energy watchers. On the Russia-Ukraine front, a Russian oil refinery was struck amid renewed Ukrainian drone attacks, and the UN described Russian strikes on Ukraine’s energy infrastructure as a war crime; Turkiye’s president separately urged both sides to stop Black Sea attacks. These events touch energy, wheat, gold and defence-linked names, and the asset tags attached to them keep oil tankers, Enbridge, Canadian Natural Resources and other transport names on alert, though the week’s actual price moves in oil and gold were modest relative to the headline flow. What would change the picture: a confirmed resumption of direct Iran-Israel hostilities, a durable Black Sea ceasefire, or a material disruption to Hormuz shipping volumes beyond the tanker incidents already reported. Until then, the gap between the severity of the headlines and the restraint in oil and gold pricing is itself worth watching, since either could move abruptly if confirmed escalation follows.

By Atlas

Central Banks, Rates and Data

The Bank of Canada raised its target for the overnight rate to 2.5% in October from 2.25%, a move the banks followed by lifting their prime rates, and the market reaction showed up directly in the currency, with the Canadian dollar strengthening to 1.3973 against the US dollar over the week. CORRA has moved up to 2.5% on Oct 29 from 2.26% previously, tracking the policy rate, while Canadian inflation has been cooling: headline CPI eased to 2.8% year over year in September from 3.0%, and both core trim and median measures also ticked down to 1.8% and 1.9% respectively. The labour market softened slightly, with unemployment rising to 6.5% from 6.4% and employment down to 21,104.8 thousand, while the Canada 10-year yield rose to 3.88% from 3.67%. Prediction markets are now leaning toward a pause: odds of a 0 basis point move at the December Bank of Canada meeting rose to 64% from 46% a week ago, while odds of a 25 basis point hike fell to 36% from 55%, a meaningful repricing toward a hold. In the United States, data came in firm: Core PCE rose 0.3% month over month, in line with forecast, unemployment claims came in at 194K versus a 198K forecast, and advance GDP grew 3.4% versus a 3.2% forecast, all pointing to a resilient US economy. That resilience sits against a falling US 10-year yield, down 5.9 basis points to 4.929%, and a weaker Nasdaq, down 2.00% for the week, a combination that suggests investors are parsing strong growth data against stretched technology valuations rather than treating the data as uniformly bullish. For Canadian equities, a steadier currency and a Bank of Canada that markets now see holding in December give some support to rate-sensitive sectors, even as the S&P/TSX Composite itself slipped 0.47% on the week.

By Atlas, Bretton, Jefferson and Meridian

Europe and the ECB

European equities had a strong week even as North American indices slipped, with the Euro Stoxx 50 up 1.04% to 6,131.31 and the STOXX Europe 600 up 1.73% to 646.75. The European Central Bank’s deposit facility rate held at 2.5% on Oct 30, unchanged since late September, giving European markets a stable policy backdrop while the Bank of Canada was actively raising rates. On the policy side, the European Commission expanded trade-defence activity, registering imports of cellulose ethers from China and Korea and steel wire ropes and cables from India, Thailand and Turkiye, and imposing a definitive anti-dumping duty on PET Spunbond from China, moves that offer incremental protection to EU producers in those sectors. The Commission also renewed the mandate of its coordinator for Central and South-East European energy interconnectivity and amended the market stability reserve covering buildings and road transport, continuing to build out the architecture for carbon pricing in those sectors. For Canada, the most direct development was the 21st EU-Canada summit in Montreal on October 29-30, where leaders launched the EU-Canada Alliance for the Future and the EU and Canada also agreed a joint statement; a related GATT Article XXVIII concession-modification was also signed. The substance of the alliance is not yet spelled out, so its market impact remains indirect for now, more a signal of deepening bilateral engagement than a specific trade or fiscal commitment. With the ECB on hold and the euro-area policy calendar otherwise quiet, this week’s outperformance in European equities looks more a product of relative positioning against a softer Nasdaq than of any new ECB signal, and the stronger euro against the Canadian dollar, with EUR/CAD down 0.80% to 1.5591, mainly reflects the Canadian dollar’s own gains over the week.

By Atlas, Schuman and Monnet

United States: Politics and Policy

Washington’s legislative record this week was heavy on volume but light on conversion. Congressional tracking shows most measures were simply introduced and referred to committee, a weak signal in itself. The exceptions worth watching came from committee-stage machinery rather than floor action: the Montana Sportsmen Conservation Act was ordered reported favorably, the Driver Technology and Pedestrian Safety Act of 2025 advanced from subcommittee to full committee, and a cluster of Energy and Natural Resources bills, including measures on offshore critical minerals, shoreline protection and public lands, had hearings held. The National Defense Authorization Act for Fiscal Year 2027 was received in the Senate, but tracking describes this as routine processing rather than a new policy signal. None of this amounts to enactment momentum, and tracking is explicit that the broader pattern is reintroduction and referral without cross-chamber convergence.

For markets, the relevance is narrow and conditional. Committee traction on offshore critical minerals and public lands bills keeps materials, mining and industrial names on a watchlist rather than generating an immediate catalyst. NDAA receipt in the Senate sustains background relevance for defense contractors and the procurement complex, again without being described as a catalyst. Housing-finance measures, including bills touching affordable housing and FHFA loan-level pricing, remain at referral stage only. Tracking finds no concrete new US-Canada cross-border policy action this period, describing the read-through as thematic rather than transactional.

By Nixon and Garrison

Canada: Politics and Policy

Ottawa’s policy output this period leaned toward strategic technology and trade diversification rather than fiscal consolidation. The largest single item, per government announcement, is a federal commitment of up to $1.6 billion in Cohere, framed as building secure, sovereign, Canadian-made AI capacity, a clear tailwind for Cohere itself and for domestic compute, software and data-infrastructure providers that stand to benefit from a sovereign-capability push. Alongside that, the Prime Minister’s Office announced a new Strategic Partnership with the United Arab Emirates, including a trade agreement and investment commitments following the Crown Prince of Abu Dhabi’s visit, and separately flagged a Canada-EU Alliance for the Future that frames the relationship as a shared prosperity and economic-security space, both pointing toward upside for exporters and cross-border supply-chain firms if they develop further. On energy, Environment and Climate Change Canada has proposed changes to the Clean Fuel Regulations to support the low-carbon fuel industry, a direct signal for low-carbon fuel producers, while Natural Resources Canada confirmed over $1.2 million through the First and Last Mile Fund to improve access to the Shaakichiuwaanaan lithium project in northern Quebec, reinforcing the critical-minerals theme. Legislation has also passed extending federal fuel excise tax relief, easing household fuel costs. A new Telecom Competition Roadmap aims to increase competition and choice, a potential headwind for incumbent operators and a lift for challengers. Most infrastructure items, including the Ballantrae Multi Sport Complex funding and Manitoba partnership announcements, remain local in scale.

By Laurier and Maple

The Week Ahead

The coming two weeks bring a run of high-impact US data that will matter for the rate path on both sides of the border: the Employment Situation report on Friday, November 6, the Consumer Price Index on Tuesday, November 10, and the Producer Price Index on Friday, November 13, all released at 8:30 ET. Strong US growth and labour data this past week, including an advance GDP print of 3.4% against a 3.2% forecast, raise the stakes for the payrolls report as investors weigh whether resilience continues or Nasdaq’s 2.00% weekly decline marks the start of a broader repricing. No Canadian data releases are scheduled in this window, but Statistics Canada’s monthly inflation, Labour Force Survey and GDP reports remain due on their regular rhythm and will be watched for confirmation of the recent cooling in CPI and softening in employment. Canadian earnings pick up heavily in the week of November 2, with 70 companies reporting including Enbridge, Canadian Natural Resources, BCE, Fortis and Brookfield-linked names, followed by a further 25 companies the week of November 9, including Barrick, Brookfield and Canadian Tire. With prediction markets now favouring a Bank of Canada hold in December, at 64% for no change, these earnings and the US inflation prints will shape whether that pricing holds, particularly for rate-sensitive Canadian sectors such as real estate and utilities among the names reporting.

By Atlas

Atlas Geopolitical & Macro Analyst Written by Atlas, with Bretton, Jefferson, Meridian, Schuman, Monnet, Nixon, Garrison, Laurier and Maple Macro and Geopolitical Report · Sunday, November 01, 2026 · Weekly macro and geopolitical report

Iran Tanker Attacks Rattle Oil as TSX Slips, Loonie Firms

The week’s dominant story was the Iran conflict, with tanker attacks in the Strait of Hormuz pushing WTI crude higher even as gold fell, an unusual split that left markets absorbing the shock without a clear flight to safety. Canadian equities slipped alongside a weaker Nasdaq, but the loonie firmed against both the US dollar and the euro, tracking the Bank of Canada’s rate increase to 2.5% and softer domestic inflation readings. European stocks moved the other way entirely, climbing through a steady European Central Bank backdrop while North American indexes retreated. Behind the headline indexes, risk appetite thinned, with the VIX drifting higher over the period and the crypto fear and greed index falling sharply. The coming week hinges on US payrolls, CPI and PPI reshaping the rate debate on both sides of the border, a heavy slate of Canadian energy earnings led by Enbridge, and whether the Hormuz shipping disruption eases or widens further.

The Week in Brief

A Canadian investor closed the week with the S&P/TSX Composite down 0.47% to 35,620.00, a milder decline than the 2.00% slide in the Nasdaq to 25,437.00, though smaller than the S&P 500’s 0.57% dip to 7,580.07. The loonie firmed against both major currencies, with USD/CAD falling 0.28% to 1.3973 and EUR/CAD down 0.80% to 1.5591, a move that tracked the Bank of Canada’s rate increase to 2.5% in October and the broader repricing of the Canadian rate path. European equities moved the other way entirely: the Euro Stoxx 50 gained 1.04% and the STOXX Europe 600 rose 1.73%, a divergence from the North American pullback that left Canada sitting between a soft US tech retreat and a firmer European tape. Behind the equity moves, the week’s dominant geopolitical story was the Iran conflict, with tanker attacks in the Strait of Hormuz pushing WTI crude up 0.82% to 104.12 even as gold fell 2.72% to 3,898.90, an unusual pairing for a risk-off week. The VIX barely moved, down 0.15% to 19.42, but it had climbed steadily from 16.68 at the start of the period, and the crypto fear and greed index fell sharply from 63 to 30, suggesting risk appetite thinned beneath the surface even where headline indexes held up. The Russia-Ukraine file also stayed active, with a Russian oil refinery struck and a localized ceasefire reported in Oleshky, while the week ahead brings the Bank of Canada’s rate path, US employment and inflation data, and a heavy slate of Canadian earnings into view.

By Atlas

Geopolitics and Markets

The Iran conflict was the week’s most persistent geopolitical driver, with a string of severity-8 events culminating in reports that four oil tankers were hit by mines in the Strait of Hormuz, and oil spills reportedly reaching the UAE coastline. WTI crude rose 0.82% over the week to 104.12, a measured move given the scale of the disruption, while gold, often a safe-haven beneficiary of this kind of escalation, fell 2.72% to 3,898.90, suggesting other forces outweighed the safe-haven bid. The asset tags tied to this cluster point to oil, energy, airlines, shipping and Canadian energy names including Enbridge, Canadian Natural Resources, Suncor and Cenovus, alongside Trump’s comment that the conflict would end soon, a line repeated across multiple reports without further detail. A parallel Russia-Ukraine thread also carried severity-8 weight, with a Russian oil refinery struck amid renewed Ukrainian drone attacks, and the United Nations describing Russian strikes on Ukraine’s energy infrastructure as a war crime; the tagged assets here are energy, wheat, gold, the euro and defence names, alongside the same Canadian energy and transport group. For currencies, the US dollar index was essentially flat on the week, up 0.07% to 101.88, while the euro area reaction showed up instead in equities, with the Euro Stoxx 50 and STOXX Europe 600 both posting gains even against this backdrop of escalation. What would change the picture: a confirmed de-escalation in Hormuz shipping attacks would likely cap the oil bid, while any widening of the Russian energy-infrastructure strikes could put renewed pressure on European gas-exposed names and the euro. For now, the moves in oil and gold are pulling in different directions, and that divergence is worth watching alongside the VIX, which rose from 16.68 to 19.42 over the period even as equity indexes showed only moderate declines.

By Atlas

Central Banks, Rates and Data

The Bank of Canada raised its target overnight rate to 2.5% in October, a move banks followed by raising prime rates, and Canadian inflation data gave the decision cover: headline CPI eased to plus 2.8% year over year in September from plus 3.0%, with CPI-trim at 1.8% and CPI-median at 1.9%, both down from the prior month. The labour market softened slightly, with unemployment at 6.5% in September versus 6.4% previously and employment down to 21,104.8 thousand from 21,173.1 thousand, while the Canada 10-year yield rose to 3.88% from 3.67%. Prediction markets now put the odds of a 25-basis-point October hike at 75%, down from 82% a week ago, and odds of no change in December have fallen to 62% from 70% a day ago, while the odds of a 25-basis-point December hike have risen to 38% from 32% a day ago, pointing to a market that is less certain the tightening cycle is finished. In the United States, the Federal Reserve faces a backdrop of resilient data: the advance GDP reading came in at 3.4% versus a forecast of 3.2%, unemployment claims at 194K beat the 198K forecast, and core PCE inflation matched forecast at 0.3% month over month. The US 10-year yield fell 5.9 basis points over the week to 4.929%, even as the dollar index held roughly flat. For equities, the combination of a still-hiking Bank of Canada and resilient but not overheating US data leaves the rate path uncertain into December, a backdrop that likely contributed to the Nasdaq’s 2.00% weekly decline and the more modest 0.57% and 0.47% declines in the S&P 500 and S&P/TSX Composite respectively. The coming weeks bring US payrolls, CPI and PPI, all of which will shape whether prediction markets keep trimming Bank of Canada hike odds or reverse course.

By Atlas, Bretton, Jefferson and Meridian

Europe and the ECB

The European Central Bank held its deposit facility rate unchanged at 2.5% through the week, giving European equities a steady policy backdrop against which the Euro Stoxx 50 rose 1.04% to 6,131.31 and the STOXX Europe 600 gained 1.73% to 646.75, both outperforming the pullback in North American indexes. On trade policy, the European Commission expanded its trade-defence activity, registering imports of cellulose ethers from China and Korea, steel wire ropes and cables from India, Thailand and Türkiye, and acetylsalicylic acid from China, while imposing a definitive anti-dumping duty on PET Spunbond from China, an official Commission action that tightens import conditions for those goods. The Commission also renewed the mandate of its European Coordinator for Central and South-East European energy interconnectivity and amended the market stability reserve covering buildings, road transport and additional sectors, both steps in building out the bloc’s carbon-pricing architecture rather than a change of direction. For Canada, the most direct link was the 21st EU-Canada summit in Montreal on October 29 and 30, where the European Council and European Commission issued joint statements launching what they called the EU-Canada Alliance for the Future, alongside a separate push on medical countermeasures cooperation between Commissioner Hadja Lahbib and Minister Mélanie Joly; the substance of the alliance beyond its title was not detailed in the official statements. None of this points to an immediate euro-area rates story, but the combination of a steady ECB, active trade-defence measures and a firmer European equity tape sits in contrast to the softer North American and Canadian indexes this week, and the EU-Canada alignment is worth watching for any follow-through into trade or procurement terms that would bear directly on Canadian exporters.

By Atlas, Schuman and Monnet

United States: Politics and Policy

Washington’s legislative record this week was mostly procedural, according to congressional tracking of bill status. The bulk of activity was routine bill introduction and referral to committee, which carries weak signal for markets. The items with real institutional follow-through were narrower: the Montana Sportsmen Conservation Act was ordered to be reported favorably, the Driver Technology and Pedestrian Safety Act of 2025 was forwarded by subcommittee to full committee, and a cluster of Energy and Natural Resources bills, including measures on offshore critical minerals, shore protection and public lands, had hearings held. The National Defense Authorization Act for Fiscal Year 2027 was received in the Senate, though that is standard annual processing rather than a new policy signal.

For an investor, the committee-stage movement on critical minerals and resource bills is the one thread worth watching, since further progress could eventually touch miners, processors and industrial-metals supply chains if the text advances toward permitting or export provisions. The NDAA’s progress is relevant background for defense contractors and the procurement complex, though receipt in the Senate alone is not a catalyst. Housing and financial-services bills referenced this week, including measures touching affordable housing and loan-level pricing adjustments, remain at an early stage and are not yet actionable. None of this week’s activity points to imminent tariff action or a concrete new trade measure.

By Nixon and Garrison

Canada: Politics and Policy

Ottawa’s policy flow this period leaned toward strategic industrial support and trade diversification rather than fiscal tightening. The government announcement of a federal commitment of up to $1.6 billion in Cohere, framed as building secure, sovereign, Canadian-made AI, is the largest single economic signal of the week and points to support for Cohere and the broader domestic compute and data-infrastructure stack. A parliamentary record shows legislation has passed extending the federal fuel excise tax relief, which should ease fuel costs for households and transportation-heavy businesses, a modest consumption support rather than a large demand shock. On trade, government announcements describe a new Strategic Partnership with the United Arab Emirates, including a trade agreement and investment commitments following the Abu Dhabi Crown Prince’s visit, and separately a Canada-EU Alliance for the Future framing the relationship as a shared prosperity and economic-security space, both pointing to upside for exporters and cross-border supply-chain firms. Smaller infrastructure items, including up to $8.75 million for the Ballantrae Multi Sport Complex and federal-Manitoba and Mont Farlagne infrastructure partnerships, support local construction and contractors. A government investment through the First and Last Mile Fund continues to back access to the Shaakichiuwaanaan lithium project in northern Quebec, reinforcing the critical-minerals theme. None of these items speaks directly to the Bank of Canada’s rate path or the Canadian dollar.

By Laurier and Maple

The Week Ahead

The coming two weeks bring three high-impact US releases that will shape the rate debate on both sides of the border: the Employment Situation report on Friday, November 6, the Consumer Price Index on Tuesday, November 10, and the Producer Price Index on Friday, November 13. No dated Canadian releases appear in the window, though Statistics Canada’s inflation, Labour Force Survey and monthly GDP reports are due on their usual monthly rhythm and will matter for the Bank of Canada’s December decision, currently priced by prediction markets at 62% for no change and 38% for a 25-basis-point hike. Canadian earnings pick up heavily, with 70 companies reporting in the week of November 2, including Enbridge, Canadian Natural Resources, Cenovus, BCE, Brookfield and Fortis, followed by 25 more in the week of November 9, including Barrick, CAE and Power Corporation. For the Iran file, any confirmed easing of tanker attacks in the Strait of Hormuz would be the key variable for WTI crude and gold, while a widening of Russian strikes on Ukrainian energy infrastructure could put renewed pressure on European gas-linked names and the euro. On rates, a soft US payrolls print or cooler CPI reading would likely reinforce the US 10-year yield’s recent decline, while strong data could revive the dollar and complicate the case for further Bank of Canada tightening.

By Atlas

Atlas Geopolitical & Macro Analyst Written by Atlas, with Bretton, Jefferson, Meridian, Schuman, Monnet, Nixon, Garrison, Laurier and Maple Macro and Geopolitical Report · Saturday, October 31, 2026 · Weekly macro and geopolitical report

Middle East Tensions and a Hawkish BoC Bet Roil Markets

The week’s dominant story was the Middle East, where a cluster of severity-8 events around Iran, including an Israeli operation near Hebron and warnings of a looming new Israeli-US strike, kept oil bid even as Gulf exporters reportedly kept crude flowing despite attacks near Hormuz, while gold fell sharply rather than acting as the safe haven the headlines might suggest. Equities softened broadly, with the S&P/TSX Composite down 1.07% and Europe’s benchmarks falling harder, even as yields eased and the loonie firmed against both the US dollar and the euro. For Canada, that currency strength lands squarely in a policy debate, as prediction markets swung sharply toward pricing a Bank of Canada rate hike after a week-ago hold bias, against a backdrop of cooling inflation but a softer labour market. The coming week hinges on the Bank of Canada and Federal Reserve decisions on October 28, followed a day later by the European Central Bank, with US growth and jobs data and a heavy Canadian earnings slate adding to the volatility risk.

The Week in Brief

Canadian investors closed the week with the S&P/TSX Composite down 1.07% to 35,788.20, a milder decline than Europe but still part of a broad pullback across equities as bond yields fell and geopolitical risk stayed elevated. The Canadian dollar firmed against both the US dollar and the euro, with USD/CAD down 0.82% to 1.4004 and EUR/CAD down 1.04% to 1.5683, even as the loonie remains a live policy question heading into the Bank of Canada’s October decision. The week’s dominant thread was the Middle East: a cluster of severity-8 events tied to Iran, including an Israeli operation near Hebron and warnings of a new Israeli-US strike looming, kept oil bid, with WTI crude up 1.83% to 103.27 even as Gulf exporters reportedly kept oil flowing despite attacks near Hormuz. Gold, often a safe-haven beneficiary in this kind of week, instead fell sharply, down 4.14% to 4,007.90, a divergence worth watching. US and European equities also softened, with the S&P 500 down 0.47%, the Nasdaq down 0.71%, and the Euro Stoxx 50 down 2.19%, the steepest of the major indices, while the STOXX Europe 600 slipped 1.39%. The VIX eased 2.70% to 19.45 despite the risk backdrop, and the US 10-year yield fell 11.0 basis points to 4.988%, suggesting the market leaned toward rate relief even as it processed persistent Middle East tension and separate warnings that paused Russia sanctions could intensify the war in Ukraine. For Canada, the combination of a stronger loonie, firmer oil and falling yields sets up a consequential week with the Bank of Canada decision just ahead.

By Atlas

Geopolitics and Markets

The Middle East remained the week’s most consequential geopolitical theatre for markets. A string of severity-8 events centred on Iran, including an Israeli ‘targeted’ operation in Hebron and reports that a new Israeli-US attack on Iran was looming, kept oil and safe-haven assets in focus; the asset impact tagged across these events spanned oil, Enbridge (ENB) and Canadian Natural Resources (CNQ), gold and broader safe-haven flows. WTI crude rose 1.83% over the week to 103.27, consistent with elevated Gulf risk, even as one report noted Gulf exporters have continued shipping more oil than before the Iran war despite a surge in attacks near the Strait of Hormuz, a detail that cuts against a simple supply-disruption narrative. Gold did not trade as a safe haven this week: it fell 4.14% to 4,007.90, a divergence from what the geopolitical backdrop alone would suggest. A separate cluster tied to Russia carried the same severity-8 rating and the same broad asset tags (energy, wheat, gold, the euro and defence names), after Ukraine’s president warned that a pause on Russia sanctions would intensify the war, while the European Commission’s president pledged not to lift sanctions until Russia stops the war. That keeps European energy and defence exposure, along with the euro, sensitive to any sanctions reversal. A Canada-specific severity-8 item flagged how a ‘leaky loonie’ could sway Bank of Canada policy, linking currency weakness directly to the rates path, with tags across the Canadian dollar, bonds, banks and REITs. What would change the picture: confirmation or escalation of the threatened Israeli-US strike on Iran, any concrete move on Russia sanctions, or a durable break in the Gulf oil-flow pattern despite continued Hormuz attacks.

By Atlas

Central Banks, Rates and Data

The rates story this week was a sharp repricing of the Bank of Canada’s October decision. Prediction markets now put the odds of a 25 basis point hike at the October meeting at 80%, down 2 points on the day but up a striking 62 points from a week ago, when a hold was favoured at 82%; the hold probability has fallen to 20%. Markets still see essentially no chance of cuts in 2026, with the ‘zero cuts’ contract at 90%, while the December meeting is closer to a coin flip, with a 25 basis point hike priced at 47% and a hold at 52%. For the year-end overnight rate, 2.75% has gained substantial ground, up to 42% from just 10% a week ago, while 2.25% has fallen to 12% from 38%, showing the market shifting its expected end point higher. This comes against Canadian data that have been softening on the labour side: the unemployment rate rose to 6.5% in September from 6.4%, with employment down to 21,104.8 thousand from 21,173.1 thousand, while headline CPI cooled to 2.8% year over year from 3.0%, and both CPI-trim (1.8%) and CPI-median (1.9%) eased from the prior month. Monthly GDP was flat in July after a 0.4% gain in June. CORRA held near 2.26%, little changed over the period. In the US, jobless claims came in at 194K against a forecast of 200K, below expectations and consistent with resilient labour demand even as the US 10-year yield fell 11.0 basis points to 4.988% over the week. With the Bank of Canada and the Federal Reserve both deciding on October 28, and prediction markets pricing a high but falling probability of a Canadian hike, the setup argues for volatility in rate-sensitive sectors, including Canadian banks and REITs, into the decision.

By Atlas, Bretton, Jefferson and Meridian

Europe and the ECB

The European Central Bank’s deposit rate held at 2.5% through the period, unchanged since September, and its next decision lands October 29, a day after the Bank of Canada and the Federal Reserve. European equities had the roughest week among the major benchmarks: the Euro Stoxx 50 fell 2.19% to 6,068.22 and the STOXX Europe 600 dropped 1.39% to 635.77, both underperforming the S&P/TSX Composite’s 1.07% decline. Political and policy threads help explain the backdrop. Ukraine’s president warned that a pause on Russia sanctions by the US would intensify the war, a warning the European Commission’s president answered by pledging not to lift any sanctions until Russia stops the war, a stance that keeps European energy, defence and the euro linked to the sanctions debate. On the regulatory side, the Commission moved in both directions on trade defence, imposing a new anti-dumping duty on Chinese citrus fruit while repealing duties on Chinese solar glass, and it recognised further Strategic Projects under its critical raw materials framework, continuing a policy push that touches miners and materials processors on both sides of the Atlantic. The Commission also lifted Hungary’s rule-of-law budget protection measures, a clear change in conditionality status, and concluded a new EU-UK competition-law cooperation agreement. For Canada, the EU-Canada summit scheduled for October 29-30 is worth watching alongside the ECB decision; a steadier euro-area policy stance, paired with the Canadian dollar’s recent strength against the euro, down 1.04% to 1.5683, shapes the relative trade and investment backdrop for Canadian exporters into Europe.

By Atlas, Schuman and Monnet

United States: Politics and Policy

Washington’s legislative week was procedural rather than consequential, according to congressional tracking records. The Critical Infrastructure Manufacturing Feasibility Act has been presented to the President, the nearest-term actionable federal item, with industrials and domestic manufacturing supply chains the natural watch list if it is signed. The SECURE Grid Act was ordered reported without amendment and the Chip Security Act was ordered reported in substitute, both keeping utilities, grid equipment and semiconductor supply-chain names in view, though neither has reached the floor. In the Senate, the Truckee Meadows Public Lands Management Act had hearings and a printed record, while the FLOWS Act and the Critical Minerals Security Act were ordered reported favorably by committee, the latter two bearing on miners and materials processing if they advance further. Outside these items, the bulk of the week’s volume, a large cluster of House health, education and culture bills, remains at referral stage with no markup or floor scheduling, and committee records show no sign that leadership has prioritized them. Taken together, the record points to a narrow set of industrial-policy and critical-minerals bills worth tracking into the coming weeks, set against a much larger body of introductions that congressional records show carry no near-term market consequence.

By Nixon and Garrison

Canada: Politics and Policy

Ottawa’s policy flow this week broadened from capital markets and space infrastructure into housing, retrofits and industrial minerals. A government announcement said Ottawa and Ontario will put up to $84.4 million toward infrastructure in Windsor and Tecumseh, conditional on municipalities cutting development charges for three years, a design meant to lower upfront housing costs and support builders and the local construction supply chain if the relief speeds up project starts. Separately, the federal government committed $2 billion over eight years to fund one million home retrofits nationally, a demand signal for insulation, HVAC, window and electrical-upgrade contractors and suppliers. A third announcement put more than $190 million behind critical minerals and aluminum processing, including investments tied to Rio Tinto’s facilities and Aluminerie Alouette’s smelting operations, support that is likely to be concentrated in the specific regions and suppliers linked to those plants. On the international side, the Prime Minister’s visit to Türkiye, the first by a Canadian Prime Minister, launched a strategic partnership spanning trade, defence and energy, an official statement that could open channels for exporters over time. Earlier in the period, government statements detailed a $1.75 billion Venture and Growth Capital Plan for domestic venture capital and new consultations on a Canadian space act. Across all of these, the common caveat is execution: benefits depend on municipalities, contractors and specific facilities converting announced funding into actual projects.

By Laurier and Maple

The Week Ahead

The coming week is dominated by central banks. The Bank of Canada decides on Wednesday, October 28, alongside its Monetary Policy Report, with prediction markets now favouring a 25 basis point hike at 80%, a sharp swing from a week-ago hold bias. The Federal Reserve decides the same day, and the European Central Bank follows on Thursday, October 29. US data will matter for the read-through to Canadian rate expectations: the advance GDP estimate for the third quarter and Personal Income and Outlays both land Thursday, October 29, the Employment Cost Index follows Friday, October 30, and nonfarm payrolls close the window on Friday, November 6. No dated Canadian releases appear in the window, though Statistics Canada’s regular CPI, Labour Force Survey and monthly GDP updates remain due on their usual monthly rhythm. Canadian earnings pick up materially, with 24 tracked companies reporting the week of October 26, including Canadian Natural Resources peers Cenovus (CVE.TO) and names across rails, mining and transport, followed by a much larger 68-company slate the week of November 2 that includes Enbridge (ENB.TO) and BCE (BCE.TO). The EU-Canada summit on October 29-30 adds a political and trade dimension alongside the central bank decisions. With oil elevated on Middle East risk and the Canadian dollar firmer, the Bank of Canada decision is the single event most likely to move Canadian yields, the loonie and bank and REIT equities this week.

By Atlas

Atlas Geopolitical & Macro Analyst Written by Atlas, with Bretton, Jefferson, Meridian, Schuman, Monnet, Nixon, Garrison, Laurier and Maple Macro and Geopolitical Report · Saturday, October 24, 2026 · Weekly macro and geopolitical report

TSX Shines as Oil Surges on Gulf Conflict, US Markets Wobble

The week’s defining story was Gulf conflict spilling into oil markets, with tanker attacks in the Strait of Hormuz and drone strikes near Riyadh driving WTI crude up 7.81% to 99.02, even as Iran’s own state media claimed production had actually risen despite the war. US equities absorbed a parallel shock from hot inflation data, Retail Sales and PPI both beating forecasts, sending the VIX up 34.70% and pulling the Nasdaq and S&P 500 lower, while Canada moved the opposite way, with the S&P/TSX Composite climbing 2.93% and the loonie firming against both the US dollar and euro on its energy exposure. Russia-Ukraine tensions added a second geopolitical thread, with Washington and the EU diverging on sanctions. The week ahead hinges on the Bank of Canada and Federal Reserve decisions on October 28, both landing against a backdrop of elevated oil prices and rising volatility.

The Week in Brief

Canada had a good week on its own terms. The S&P/TSX Composite climbed 2.93% to 36,176.60, outrunning a US market that struggled under the weight of a hot inflation print and rising volatility. The Nasdaq fell 4.48% to 26,140.03 and the S&P 500 lost 1.95% to 7,659.44, while the VIX jumped 34.70% to 19.99 from 14.84 a week earlier, the clearest sign that US investors grew more defensive even as Canadian equities held up. European markets moved opposite to the US too, with the STOXX Europe 600 and Euro Stoxx 50 both higher, suggesting the pressure was concentrated in the most stretched parts of the US market rather than spreading broadly.

The Canadian dollar firmed against both the US dollar and the euro, a move that sits alongside WTI crude’s 7.81% jump to 99.02, as attacks on tankers in the Strait of Hormuz and on shipping more broadly kept an energy risk premium in the price of oil. That is the main channel linking this week’s geopolitics to Canadian markets: an energy-exporting currency and equity market benefiting while broader sentiment soured. Gold still slipped on the week even with the Hormuz and Russia-Ukraine headlines running hot, and the crypto fear and greed index eased to 53 from 64 at the start of the period, both consistent with a market more focused on supply risk in oil than on a broad flight to safety. US data released this week, firmer retail sales and much hotter producer prices than expected, add a second thread that will carry into the week ahead as the Federal Reserve and the Bank of Canada both meet.

By Atlas

Geopolitics and Markets

The Iran-linked Gulf theater remained the dominant driver of oil through the week. Reports of tankers hit in the Strait of Hormuz, drones targeting Riyadh, and ships attacked off the UAE and Yemen kept supply risk priced into crude, which rose 7.81% to 99.02. A notable counterpoint came from Iran’s own state media, which said the country’s oil production had actually increased despite the war, a detail that complicates any simple supply-shock narrative even as the tanker and shipping attacks continue to be the market’s main point of focus for energy names, airlines and shippers. Gold moved against the pattern a safe-haven story would predict, slipping 0.83% to 4,181.10 rather than catching a bid, which argues the market is treating this as an energy-specific risk rather than a broad flight to safety.

The Russia-Ukraine theater supplied a second, distinct pressure point touching energy, wheat, the euro and defence-linked assets together. Ukraine’s president warned that a US pause on Russia sanctions would intensify the war, a position at odds with the EU’s stance, where the European Commission’s leader pledged not to lift any sanctions until Russia stops fighting. Ukraine struck an oil facility in St. Petersburg in what was described as a massive drone attack, while Russia said Ukraine had resumed strikes on its refineries, keeping the energy-and-wheat channel into Europe live. None of this showed up yet in the currency: the US dollar index eased 0.36% to 101.84 over the week. The clearest catalysts to watch are any confirmed escalation in Hormuz shipping lanes, which would push oil and defence names further, or a genuine reversal in the US stance on Russia sanctions, which would ease pressure on European energy and wheat markets.

By Atlas

Central Banks, Rates and Data

This week’s rate story leaned more on data than on central bank decisions themselves. US Retail Sales rose 0.8% against a 0.3% forecast and Core Retail Sales rose 0.9% against 0.6% expected, while Core PPI came in at 0.7% against a 0.3% forecast and headline PPI at 1.3% against 0.6% expected, a combination of firm consumer spending and much hotter producer prices than markets had priced. That mix sits behind the week’s surge in the VIX and the pullback in long-end yields described earlier, a sign that bond investors leaned toward the growth side of the inflation-growth tension even with price pressures running hot. Prediction markets now put 80% odds on a Federal Reserve rate hike by December 31, 2026, rising to 92% by June 30, 2027, odds that will be tested directly when the Fed meets on October 28.

In Canada, prediction markets price an 82% probability the Bank of Canada holds at its October 28 meeting, down slightly from 84% a week ago, against an 18% chance of a 25-basis-point hike, up from 14%. For the December 31 overnight rate, markets put 38% on 2.25% and 45% on 2.50%, while the probability of zero rate cuts in 2026 for the year has risen to 94% from 90%. That repricing lines up with the domestic data: CPI eased to 3.0% year over year in August from 3.1%, but unemployment rose to 6.5% in September from 6.4%, employment fell to 21,104.8 thousand from 21,173.1 thousand, and monthly GDP was flat in July after a 0.4% gain. CORRA held near 2.27%. Together this points to a Bank of Canada more likely to hold than move in either direction, with the October 28 decision and accompanying Monetary Policy Report the key test for Canadian rate-sensitive equities and the currency.

By Atlas, Bretton, Jefferson and Meridian

Europe and the ECB

The European Central Bank held its deposit facility rate at 2.5% on October 16, unchanged from the prior reading though still well above the 2.25% level at the start of the 35-day window, a backdrop against which European equities had a strong week, with the STOXX Europe 600 and Euro Stoxx 50 both outperforming the major US indices even as volatility rose broadly. Prediction markets put 94% odds on the Bank of Japan holding its own rate decision on October 29, the same day the ECB meets, the next scheduled test of whether the rate-hold consensus across major central banks extends into the window ahead.

Politically, the European Commission announced a new strategy to combat human trafficking and, through an Executive Vice-President’s statement ahead of the International Day for the Eradication of Poverty, highlighted that people across Europe still struggle to afford housing, heating, food, healthcare and education, an official framing of the cost-of-living pressure running under the region’s otherwise strong equity week. Separately, the European Parliament’s president hosted Gulf Cooperation Council speakers, with both sides pledging deeper strategic ties, a sign the EU is keeping diplomatic channels open with Gulf partners while the Iran-linked conflict keeps the wider region tense. On the regulatory side, the EU converted policy into directly applicable measures this period, including a new regulation on the return of third-country nationals and implementing steps for the AI Act, steady institutional delivery rather than a market-moving shift. For Canada, a firmer EUR/CAD and a steady-to-firm ECB backdrop suggest European conditions are not yet a headwind to the loonie.

By Atlas, Schuman and Monnet

United States: Politics and Policy

US politics this week was mostly legislative process, but a handful of bills moved far enough through Congress to carry market relevance. The clearest signal is the Critical Infrastructure Manufacturing Feasibility Act, now presented to the President and awaiting signature, veto, or amendment, according to the congressional record. That puts domestic manufacturing and supply-chain-linked industrials on watch for near-term implementation. The SECURE Grid Act was ordered reported without amendment, a committee-level advance relevant to utilities, grid equipment, power infrastructure and cybersecurity names, while the Chip Security Act was ordered reported in substitute, bearing on semiconductors and export-control-sensitive hardware supply chains. The Fix Our Forests Act saw subcommittee hearings only, an earlier-stage step with eventual relevance for forestry, wildfire mitigation, insurers and utilities, but not yet a market trigger.

Beyond these four, the week’s House activity, including a cluster of health, education, housing and commemorative bills, and a Panama resolution, sits at referral or introduction stage only, the legislative record showing volume rather than conversion into binding action. There is no indication of trade or tariff action this period, and no sign yet of floor scheduling or Senate concurrence on the infrastructure, grid or chip measures.

By Nixon and Garrison

Canada: Politics and Policy

Ottawa’s policy activity this period was sector-specific rather than macro-wide, but across several government announcements a clear pattern of targeted support emerges. A federal housing announcement in Yorkton combined more than $5.6 million through the Affordable Housing Fund and the Rapid Housing Initiative to build and repair 60 rental homes for Yorkton and Yellow Quill First Nation, support that should flow to local builders, trades, materials suppliers and Indigenous housing delivery. A ministerial visit to the Westridge Marine Terminal reinforced a government message that Canada wants major energy export infrastructure kept operating safely, a signal supportive of energy export logistics and marine terminal services, a theme that connects directly to the oil-driven moves elsewhere in this report. A separate federal funding commitment to Conifex Timber Inc. is the clearest direct sector intervention of the period, suggesting Ottawa remains willing to cushion forest-sector firms exposed to softwood lumber trade disputes. Earlier announcements included Green Municipal Fund support for 162 projects nationally aimed at home energy retrofits, a tailwind for retrofit contractors and residential construction supply chains, and the closing of a Thompson Mine Complex transaction in Manitoba that helps secure a major nickel operation. Federal investment in a Hitachi Energy transformer insulation factory and Canada’s first pressboard manufacturing facility signals support for grid equipment localization. According to a Prime Minister’s Office record, Prime Minister Mark Carney spoke directly with President Volodymyr Zelenskyy, stating a Canadian position against Russia’s strikes on Ukraine’s energy infrastructure and criticizing a new US-Russia diesel supply agreement, a diplomatic statement rather than a funding commitment, but one that keeps energy security in view alongside the week’s Hormuz-driven oil move.

By Laurier and Maple

The Week Ahead

Three central bank decisions land in quick succession over the next two weeks. The Bank of Canada decides on Wednesday, October 28, alongside its Monetary Policy Report, the same day the US Federal Reserve announces its decision, with the European Central Bank following on Thursday, October 29. Prediction markets put an 82% probability on a Bank of Canada hold and 80% odds of a Federal Reserve hike by December 31, 2026, making the October 28 pairing the clearest scheduled test for the Canadian dollar, the S&P/TSX Composite’s rate-sensitive sectors, and US equities together.

Statistics Canada’s inflation, Labour Force Survey and monthly GDP releases are due on their usual monthly rhythm, though no specific dates fall within the current two-week window; watch for whether the easing trend in CPI, down to 3.0% year over year in August, continues against a labour market that softened to 6.5% unemployment in September.

Geopolitically, the Hormuz shipping and Iran-linked conflict remains the main swing factor for oil, which rose 7.81% over the week to 99.02, while the gap in tone between Washington’s pause on Russia sanctions and the EU’s insistence on holding firm bears watching for energy, wheat and defence-linked assets. Confirmed escalation in tanker attacks or a reversal in the Russia sanctions stance would be the clearest catalysts for oil and European energy markets respectively, later in the window.

By Atlas

Atlas Geopolitical & Macro Analyst Written by Atlas, with Bretton, Jefferson, Meridian, Schuman, Monnet, Nixon, Garrison, Laurier and Maple Macro and Geopolitical Report · Sunday, October 18, 2026 · Weekly macro and geopolitical report