TSX Futures Flat as Gold, Silver Crash Spooks Global Markets

On Friday, the S&P/TSX composite index dropped by 3.3% to 31,923.52, marking the largest one-day decline for the market since last April. The possibility of broad U.S. tariffs was burdening the average at the moment.

TSX Composite Ends Month on Volatile Note

The decline brought the first trade month of the year to a dismal finish. Still, for January as a whole, the index registered a 0.7% increase, a ninth straight monthly climb.

Beyond metals, shares of Bombardier dropped after U.S. President Donald Trump threatened to decertify its business jets and levy a 50% tariff on Canadian-manufactured aircraft unless authorities in Ottawa certify planes produced by American outfit Gulfstream.

Trade Tensions Weigh on Canadian Stocks

U.S. stock futures sank after steep losses in gold and silver prices hurt market morale ahead of a full week of corporate earnings and economic data.

The Dow Jones Futures down 23 points, or 0.1%, the S&P 500 Futures fell 25 points, or 0.4%, and the Nasdaq 100 Futures fell 170 points, or 0.7%, at 07:19 ET.

Wall Street Futures Under Pressure

Following President Donald Trump’s nomination of Kevin Warsh as his choice for Federal Reserve chairman, the main benchmarks saw a losing session at the conclusion of last week. Warsh would take Jerome Powell’s place in May if confirmed.

Due to a combination of a stronger dollar and widespread profit-taking following a big increase in recent months, gold and silver prices have sharply declined, prolonging Friday’s historic loss and negatively impacting sentiment.

Gold and Silver Extend Historic Decline

After an almost 10% plunge late last week, spot gold has slid another 1.8%, slipping well below a $5,000 level it had reached only days before. Silver was also under pressure following last Friday’s 30% decline, which saw the metal record its worst day in decades. Until recently, silver benefited from speculative purchases and was polished by its useful usage in a variety of industries.

The U.S. dollar dramatically gained as a result of Kevin Warsh’s nomination to be the next Fed chair. “The Fed balance sheet and Warsh’s ability to either completely reduce it or drastically change the makeup of its assets (by aggressively pushing the duration toward the short-end of the curve) continue to be the primary macro topic of discussion.

Fed Policy Shift Concerns Rise

a step that might tighten financial conditions even in the event of a reduction in the Funds Rate,” Vital Knowledge analysts wrote in a report. Warsh, a former Fed governor, has opposed the Fed’s asset purchases while endorsing Trump’s demands for sharply lower interest rates.

Later in the week, economic data may have an additional impact on rate forecasts. It is anticipated that the highly anticipated U.S. January employment report, which is coming on Friday, will demonstrate consistent job growth and a stable unemployment rate. The quarterly earnings season is scheduled to continue in full force this week.

Economic Data and Earnings in Focus

Although a disagreement with YouTube affected earnings during the quarter, Walt Disney reported better-than-expected fiscal first-quarter income prior to the opening bell due to continued performance in its theme parks sector.

Tech behemoths Amazon and Alphabet are among the more than 100 S&P 500 businesses that are scheduled to report this week. Microsoft’s earnings release last week, which, although indicating steady sales growth, failed to fully comfort markets about the near-term reward from substantial investment in AI infrastructure.

Big Tech Earnings Shape Market Mood

The Wall Street Journal reported over the weekend that Nvidia’s planned investment of up to $100 billion in OpenAI has halted due to internal issues expressed at the chipmaker, which heightened fears.

Elsewhere, Oracle on Sunday revealed its plans to raise more cash in 2026 that it will use towards expanding out its AI and cloud infrastructure, amid increased demand for more computer capacity. The business stated that it anticipates using a combination of debt and equity financing to raise between $45 billion and $50 billion in gross cash flows in 2026.

AI Spending and Corporate Strategy

Following President Trump’s announcement that the Middle Eastern oil producer was “seriously discussing” with Washington, oil prices plummeted on Monday as worries about a U.S. strike on Iran subsided. Brent prices lost 4.4% to $66.26 a barrel while U.S. West Texas Intermediate crude futures slid 4.6% to $62.19 a barrel.

Crude prices had surged considerably last week as markets factored in a greater possibility of supply interruptions from this vital region after Trump had repeatedly threatened Iran with military action over a nuclear deal and ongoing protests in the nation.

However, risks of a military strike diminished after Trump’s weekend comments. The Organization of Petroleum Exporting Countries and allies, a group known as OPEC+, maintained production steady after a weekend meeting, as largely predicted.

Frequently asked questions

1. Despite the significant decline last week, why were TSX futures essentially flat?

Investor caution ahead of global results and economic data caused TSX futures to quiet as losses in gold and silver equities offset steadiness in other sectors.

2. What led to Friday’s dramatic decline in the S&P/TSX Composite Index?

The index dropped 3.3% as a result of global risk-off attitude, weak commodity prices, and concerns about U.S. trade moves.

3. Why did gold and silver prices plummet so sharply?

Precious metals plummeted due to a stronger U.S. dollar, massive profit-taking after recent gains, and shifting expectations regarding U.S. monetary policy.

4. What was the effect on markets of Kevin Warsh’s nomination as Fed chair?

Because of his support for reducing the Fed’s balance sheet, his nomination strengthened the US dollar and sparked worries about tighter financial conditions.

5. Why did oil prices fall sharply?

While OPEC+ maintained output, oil prices fell as President Trump announced a reduction in tensions with Iran, allaying concerns about supply disruptions.

Conclusion

As sharp drops in gold, silver, and oil affected investor sentiment, global markets started the week on a cautious note. While U.S. markets are struggling with uncertainty surrounding Federal Reserve leadership, significant tech earnings, and AI investment risks, Canadian equities continue to be under pressure from commodities volatility and renewed trade concerns. With significant economic data and corporate reports due, volatility is likely to remain elevated in the short future.

Disclaimer: This article is for informational purposes only and does not constitute investment advice.