Canadian stock market slides amid mixed U.S. performance and higher oil prices

TORONTO – Canadian and most U.S. stock indexes lost ground on Wednesday as the price of oil rose amid efforts to release reserves.

“The big rotation we had seen since the beginning of the year, where people were selling lots of tech and going to old economy and more asset heavy stocks and international stocks too … Well, this is reversing, and (what) we see today is big proof of that where the Nasdaq is almost flat,” said Pierre-Benoît Gauthier, vice-president of investment strategy at IG Wealth Management.

In New York, the Dow Jones industrial average was down 289.24 points at 47,417.27. The S&P 500 index was down 5.68 points at 6,775.80, while the Nasdaq composite was up 19.03 points at 22,716.14.

The S&P/TSX composite index was down 150.82 points at 33,119.83.

Since the start of the war, sharp moves for oil prices have triggered swings up and down for financial markets worldwide, sometimes by the hour. Oil prices briefly spiked to their highest levels since 2022 this week because of the possibility that production in the Middle East could be blocked for a long time, which in turn raised worries about a surge of debilitating inflation for the global economy.

The International Energy Agency said Wednesday that its members will release a record amount of oil — 400 million barrels — from stockpiles they’ve set aside for emergencies.

Such moves push downward on oil prices in the near term, but it will likely require a full resumption of the flow of oil and natural gas from the Persian Gulf area to fully ease the market. That has investors worldwide anxiously awaiting the end of the war.

On Wednesday, Natural Resources Minister Tim Hodgson said Canada will “do its part” to lower the cost of oil globally.

The April crude oil contract was up US$3.80 at US$87.25 per barrel.

Gauthier said that markets have realized that the withdrawal from oil reserves may be difficult, since reserves are low after being tapped by the Biden administration following Russia’s invasion of Ukraine. He said it will also take time for that oil to reach the market.

Meanwhile, a report released Wednesday showed that U.S. consumers paid prices for groceries, gasoline and other costs of living that were 2.4 per cent higher in February than a year earlier. To be sure, that inflation rate was the same as the prior month’s and better than the 2.5 per cent that economists expected, but it remains above the two per cent target the U.S. Federal Reserve has set for the economy.

“The important thing to remember is that the economy and these data releases are living in the past while the stock market is living in the future, and what I mean by that is these numbers do not account for the Iran war much,” Gauthier said.

High inflation combined with a stagnating economy would create a worst-case scenario called “stagflation” that the Federal Reserve has no good tools to fix. Stagflation fears are rising not just because of higher oil prices but also because of weakness in hiring by U.S. employers.

The April gold contract was down US$63.00 at US$5,179.10 an ounce.

The Canadian dollar traded for 73.60 cents US compared with 73.71 cents US on Tuesday.

This report by The Canadian Press was first published March 11, 2026.

— With files from The Associated Press.

Companies in this story: (TSX: GSPTSE, TSX: CADUSD)