Oil jumps above US$105 after Riyadh blasts, futures slip and yields near 24-year highs. TSX, Wall Street and global markets for Oct 8.
Canadian Money Brief | Thursday, October 8, 2026 | Morning edition
Oil is jumping, futures are sliding and bond yields are sitting near 24-year highs. Explosions in Riyadh, including a blast at the city's airport, sent crude sharply higher early Thursday and pushed U.S. stock futures lower. That follows a rough Wednesday for Toronto, where banks and miners dragged the TSX down. Here is where every major market stands before the open.
- Brent crude jumped about 5% to above US$105 a barrel; WTI rose about 5% to roughly US$92.75.
- S&P 500 futures are down about 0.6% and Dow futures about 1% after Wall Street's four-day winning streak ended Wednesday.
- The TSX fell about 1.7% Wednesday to near 35,040, led lower by the big banks and gold miners.
- The U.S. 10-year yield touched 5.36% on Wednesday, its highest since April 2002, and is hovering near 5.3% again.
- Markets are pricing in at least one Bank of Canada rate hike by year-end.
Canada: TSX stumbles as banks and miners retreat
The S&P/TSX Composite Index closed Wednesday down roughly 1.7% at about 35,040, its weakest level in about a week. That leaves it around 5.5% below the record of 37,069 set in August. Rising yields and elevated oil prices revived inflation worries, and the two heaviest groups on the index took the hit. Royal Bank and TD each fell more than 1.7% as investors worried that higher borrowing costs will weigh on lending, while gold and materials stocks slid as a stronger U.S. dollar and higher yields pressured bullion. Only health care, consumer staples and telecoms managed gains.
The Canadian dollar held steady near 70.1 U.S. cents (about C$1.43 per U.S. dollar). Domestic bond yields have climbed with U.S. yields, and money markets now expect at least one 25-basis-point hike from the Bank of Canada by year-end. The central bank's key rate is 2.25%, and its next decision, with a full Monetary Policy Report, is October 28.
On the calendar: Statistics Canada is scheduled to release September jobs data Friday at 8:30 a.m. ET. August saw a surprise loss of 42,000 jobs, with unemployment at 6.4%. Also note that Canadian markets are closed Monday, October 12 for Thanksgiving.
United States: yields spook Wall Street, futures point lower
U.S. stocks slipped Wednesday as long-dated Treasury yields resumed their climb, a day after the S&P 500 and Nasdaq closed at records. The Dow and S&P 500 snapped four-day winning runs, and the Nasdaq posted its first down day in six. Industrials led the declines, with Caterpillar dropping about 5.8%, while small caps lagged, with the Russell 2000 off about 1.3%.
Minutes from the Federal Reserve's September meeting added to the hawkish tone. The Fed's quarter-point hike, to a range of 3.75% to 4.00%, was unanimous, though officials were split on whether energy-driven or demand-driven inflation is the bigger threat. Most participants still saw another hike before year-end as likely, but with little urgency for October.
| U.S. index (Wed close) | Level | Change |
|---|---|---|
| Dow Jones Industrial Average | 51,180.17 | -0.66% |
| S&P 500 | 7,801.75 | -0.22% |
| Nasdaq Composite | 27,538.69 | -0.22% |
| Russell 2000 | 2,793.20 | -1.31% |
Bond market: The 10-year Treasury yield spiked above 5.36% intraday Wednesday, then settled near 5.28% after a well-received US$39 billion auction. The 30-year yield sits around 5.66%, near levels last seen in 2002. The pain is reaching households too: the average 30-year U.S. mortgage rate jumped to 7.49%, the highest since November 2023.
Thursday's setup: S&P 500 futures are down about 0.6%, Dow futures about 1% (nearly 500 points) and Nasdaq futures about 0.9%. Weekly U.S. jobless claims land at 8:30 a.m. ET, and PepsiCo and Progressive report earnings. After Wednesday's close, Wolfspeed surged about 27% on a US$1.5 billion conditional loan commitment.
Europe: banks lead a broad sell-off
European shares fell sharply Wednesday as bank stocks tumbled and French fiscal worries flared again. The Euro Stoxx 50 lost 1.47% to 6,180.30, its biggest one-day drop since October 1, and the pan-European Stoxx 600 slid 1.00% to 630.26. The Euro Stoxx Banks index sank 3.38%, with Societe Generale and Deutsche Bank each down more than 5%. The gap between French and German 10-year yields widened to about 140 basis points.
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| European index (Wed close) | Level | Change |
|---|---|---|
| Euro Stoxx 50 | 6,180.30 | -1.47% |
| Stoxx Europe 600 | 630.26 | -1.00% |
| Germany DAX | 25,104.36 | -1.35% |
| UK FTSE 100 | 10,458.50 | -0.80% |
| France CAC 40 | >n/a | -1.22% |
Asia-Pacific: tech and chip stocks weigh
Asian markets traded broadly lower Thursday on higher oil and renewed tech weakness. South Korea's Kospi was the weakest, down about 2.1% to 6,660, even after Samsung Electronics guided third-quarter operating profit above 100 trillion won for the first time, a result that still fell short of expectations. Japan's Nikkei 225 fell about 1.1% to 69,252 and Hong Kong's Hang Seng lost about 0.7% to 23,963, with its tech sub-index down nearly 2%. Australia's ASX 200 eased about 0.6%. Mainland Chinese markets reopened after the weeklong Golden Week holiday, with the CSI 300 at 4,338.67.
Oil, gold, currencies and crypto
| Asset | Latest | Note |
|---|---|---|
| Brent crude | US$105+ | Up about 5% early Thursday |
| WTI crude | ~US$92.75 | Up about 5.1% |
| Gold | ~US$4,130 | Briefly dipped below US$4,100 support |
| Canadian dollar | ~70.1¢ US | About C$1.43 per US$1 |
| EUR/USD | ~1.12 | Recovered after a dip near 1.1165 |
| USD/JPY | ~158.2 | Yen broadly weak |
| Bitcoin | ~US$82,700 | Down about 0.7% |
Why oil is spiking: Several explosions were heard in Riyadh early Thursday, including at King Khalid International Airport, where flights were halted. No one had claimed responsibility at the time of reporting, though Yemen's Iran-backed Houthis have repeatedly claimed strikes on Saudi airports and energy sites in recent days. Fighting has also intensified around the Bab el-Mandeb Strait, and Iran has targeted ships near the Strait of Hormuz. Reports that the White House has asked the Pentagon for strike options on Iran ahead of the U.S. midterms added to the nerves. A Gulf of Mexico storm has also shut in roughly 500,000 barrels a day of U.S. output. Refined fuels are tight too: gasoil has climbed back above US$191 a barrel.
Gold is caught between safe-haven demand tied to government debt worries and the pressure of a stronger dollar and higher funding costs. Copper rose as Chinese traders returned from holiday and a strike at a major Chilean mine supported prices.
What it means for your money
- Gas prices: With Brent above US$105 and a weaker Canadian dollar, expect continued pressure at the pump in the coming days.
- Mortgages and loans: Higher bond yields tend to push up fixed mortgage rates. If you are renewing soon, ask your lender about a rate hold.
- Savings and GICs: Expectations of a Bank of Canada hike are supportive of GIC and high-interest savings rates, so it can pay to compare offers.
- Your portfolio: Canadian bank and gold stocks are sensitive to yields. A volatility day is a reminder to check that your mix still matches your time horizon.
What to watch next
- Thursday: U.S. weekly jobless claims (8:30 a.m. ET); earnings from PepsiCo, Progressive and Tesco; any confirmation of what caused the Riyadh blasts.
- Friday: Canada's September jobs report (8:30 a.m. ET); Delta Air Lines earnings.
- Monday, Oct. 12: TSX and Canadian bond markets closed for Thanksgiving.
- Oct. 28: Bank of Canada rate decision and Monetary Policy Report.
This morning edition uses Wednesday's closing levels and early Thursday trading. Figures are approximate, may have moved since publication, and are drawn from Baystreet.ca, The Associated Press / CTV News, Saxo Bank, BNN Bloomberg and CNBC market reports. This article is for general information only and is not investment, tax or financial advice. Consider speaking with a licensed advisor before making financial decisions.
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