**
North American stock markets experienced slight upward movements as investors navigated a landscape marked by geopolitical unrest and anticipation of pivotal central bank decisions. The S&P 500 rose by 0.25% to close at 6,716.09 points, while the Nasdaq Composite gained 0.47% to finish at 22,479.53 points. The Dow Jones Industrial Average increased by 0.10%, closing at 46,993.26 points. Despite these gains, investors remained cautious, particularly in light of fluctuating oil prices and the impending Federal Reserve interest rate decision.
Energy Stocks Drive TSX Performance
The S&P/TSX composite index in Canada also saw a modest increase, ending the session up 0.16% at 32,929.09. This rise was primarily driven by energy stocks, which climbed 1.1%—their longest winning streak since late January. The technology sector also performed well, gaining 1.8%. The surge in oil prices, prompted by renewed Iranian attacks on the United Arab Emirates, raised concerns about potential disruptions to global supply chains amid the ongoing U.S.-Israeli conflict. Brent crude futures increased by US$3.21, or 3.2%, to settle at US$103.42 a barrel, while West Texas Intermediate crude rose by US$2.71, or 2.9%, to reach US$96.21.
The Canadian dollar traded slightly lower against the U.S. dollar, at 72.99 cents. Meanwhile, yields on 10-year Canadian government bonds fell by 2.7 basis points to 3.407%.
Lululemon Faces Competitive Pressures
In corporate news, Lululemon Athletica (LULU-Q) forecasted its 2026 revenue and profit to fall below analysts’ expectations. The company anticipates annual revenue between US$11.35 billion and US$11.50 billion, slightly below the consensus estimate of US$11.51 billion. Additionally, Lululemon projects annual profit per share to be in the range of US$12.10 to US$12.30, compared to the analyst estimate of US$12.58. Following this announcement, Lululemon’s shares dipped by 2.3% in after-hours trading.
Nvidia Eyes Significant Revenue Potential
Nvidia (NVDA-Q) CEO Jensen Huang highlighted a substantial revenue opportunity for the company’s Blackwell and Rubin artificial intelligence chips, projecting it could exceed US$1 trillion by 2027. These chips are integral to developing large language models used in AI applications like chatbots. Huang also noted that Nvidia is resuming manufacturing of its H200 chip, which had been paused due to U.S. export restrictions on China. The company has since received the necessary licenses to continue production.
Market Sentiment and Central Bank Outlook
Despite fears of a U.S. stock market crash—intensified by ongoing Middle Eastern conflicts—options traders have shown a reduction in concern, with protective measures against market downturns declining to levels seen prior to the Israeli airstrikes on Iran. The S&P 500 remains down 2% from pre-war levels, but investor sentiment appears to be stabilising.
As the Federal Reserve prepares for its two-day meeting, there is widespread expectation that interest rates will remain unchanged in the 3.50-3.75% range. However, market participants will be keenly looking for insights on how the Fed interprets the geopolitical landscape and its implications for economic stability.
Why it Matters
The interplay of geopolitical tensions, fluctuating energy prices, and central bank policies is poised to significantly impact market dynamics. As investors brace for potential volatility, the ability to navigate these challenges will be crucial. Understanding how these global events influence local markets is vital for both individual and institutional investors aiming to make informed decisions in an increasingly uncertain economic environment.