Daily Markets Update: TSX Jumps 2.3%, Dow Surges 3% and Oil Sinks 8% After U.S. Midterms as Budget Day Arrives
Wall Street, Bay Street and Europe all rallied on Wednesday after Democrats won control of both the U.S. House and Senate, while oil suffered its sharpest one-day drop in months on bets that the Iran war could wind down sooner. By Thursday morning, the story had split: Europe pushed to record highs, but an AI and chip selloff hit South Korea, Japan and Taiwan. And today is Budget Day in Ottawa.
The Big Picture
| Market | Close | Change |
|---|---|---|
| S&P/TSX Composite | 36,341.40 | +809.12 (+2.28%) |
| Dow Jones | 53,356.12 | +1,569.40 (+3.03%) |
| S&P 500 | 7,688.62 | +119.70 (+1.58%) |
| Nasdaq Composite | 25,736.51 | +364.50 (+1.44%) |
| WTI crude (Dec.) | US$88.12 | -US$7.97 (-8.3%) |
| Canadian dollar | ≈71.6¢ US | seven-week high |
Canada: TSX Posts Its Best Day in Months
The S&P/TSX Composite closed Wednesday at 36,341.40, up 809.12 points or 2.28%, from Tuesday’s 35,532.28. The index is still about 2% below its 52-week high of 37,069.11, but the one-day move erased Tuesday’s losses and then some. The split under the surface was stark: financials surged while energy was hit by the oil plunge.
| Canada | Level | Change |
|---|---|---|
| S&P/TSX Composite | 36,341.40 | +2.28% |
| S&P/TSX Capped Financials | 786.24 | +3.05% |
| S&P/TSX Capped Energy | 440.89 | -6.20% |
| Canadian dollar (US cents) | ≈71.6 | +0.1% to +0.3% |
| Canada 10-year bond yield | 3.712% | -7 bps (lowest since Aug. 28) |
Trade data: Canada’s merchandise trade surplus widened to C$5.35 billion in September, the largest since May 2022 and well above the roughly C$4.1 billion economists expected. The headline was flattered by gold and energy: excluding those, exports fell 5.6% as new U.S. tariffs bit. Heavy oil: Western Canadian Select settled at a US$28.75 discount to WTI on Wednesday, narrower than Tuesday’s US$31.60 but still wide, leaving WCS near US$59 a barrel.
United States: Dow Posts Its Best Day Since April 2025
The Dow Jones Industrial Average jumped 1,569 points, or 3.03%, to 53,356.12, its biggest one-day gain since April 9, 2025. The S&P 500 rose 1.58%, its best day in about three months, and breadth was strong, with roughly three advancers for every decliner. Energy stocks were the weakest sector as oil tumbled, and AI-linked chip and data-centre names fell on worries about tougher oversight from a Democratic Congress. Apple closed at a record.
| U.S. markets | Close | Change |
|---|---|---|
| Dow Jones Industrial Average | 53,356.12 | +3.03% |
| S&P 500 | 7,688.62 | +1.58% |
| Nasdaq Composite | 25,736.51 | +1.44% |
| Russell 2000 | 2,856.96 | +1.58% |
| VIX (fear gauge) | 16.61 | sharply lower |
| U.S. 10-year Treasury yield | 4.89% | -6 bps |
| U.S. Dollar Index | ≈101.5 | -0.3% |
Europe: Banks Lead a Broad Rally, Records on Thursday
Every major European index finished higher Wednesday. The STOXX Europe 600 gained about 1.8%, led by banks (the sector index rose more than 4%), while oil and gas shares fell with crude. On Thursday morning the rally extended: Germany’s DAX touched a fresh record near 26,650, the FTSE 100 hit a three-month high near 10,950, and the STOXX 600 also reached a record. Defence stocks lagged, with Rheinmetall sharply lower on concerns a Democratic Congress could limit U.S. military spending.
| Europe (Wed. close) | Close | Change |
|---|---|---|
| STOXX Europe 600 | 657.40 | +1.82% |
| Germany DAX | 26,437.67 | +2.22% |
| France CAC 40 | 8,177.89 | +1.96% |
| U.K. FTSE 100 | 10,829.21 | +1.79% |
Asia: A Tale of Two Markets on Thursday
Asia split along an AI fault line. Chip and AI-linked stocks sank in South Korea, Taiwan and Japan, while markets less exposed to the AI trade rallied. South Korea’s Kospi tumbled 5.3%, enough to trigger a brief halt in program trading. Hong Kong’s Hang Seng jumped 3.7%, its biggest daily gain since May 2025, and Australia’s ASX 200 had its best session since June.
| Asia-Pacific (Thu. close) | Close | Change |
|---|---|---|
| Japan Nikkei 225 | 61,077.90 | -1.79% |
| South Korea Kospi | 5,383.80 | -5.28% |
| Taiwan Taiex | n/a | -3.2% |
| Hong Kong Hang Seng | 24,796.98 | +3.67% |
| China Shanghai Composite | 3,689.91 | +0.1% |
| Australia S&P/ASX 200 | 9,065.10 | +2.6% |
Oil and Gold: Crude Slides, Bullion Rebounds
Oil had one of its sharpest selloffs since the pandemic era as traders bet that Republican losses will push Washington toward a deal with Iran. Brent settled at US$94.62, its lowest since late August, and WTI at US$88.12. Early Thursday, crude bounced modestly, with WTI near US$87 to US$89 and Brent near US$94 to US$96, while Iran’s Revolutionary Guard reported tankers on fire near the Strait of Hormuz, a reminder that the risk premium hasn’t disappeared. Gold jumped about 3.3% to roughly US$4,070 an ounce as the dollar and Treasury yields fell, and extended toward US$4,135 on Thursday.
| Commodities | Level | Change |
|---|---|---|
| WTI crude (Dec.) | US$88.12 | -8.3% |
| Brent crude (Jan.) | US$94.62 | -8.7% |
| Western Canadian Select (implied) | ≈US$59.37 | discount US$28.75 |
| Gold (Wed. close) | ≈US$4,070 | +3.3% |
- Your TSX holdings: A 2.3% one-day jump feels great, but it follows a bumpy October and leaves the index still below its high. If you’re adding to your RRSP or TFSA, a regular schedule beats trying to time a one-day pop.
- Gas and heating costs: Crude fell more than 8%, but pump prices lag oil by days to weeks and Wednesday’s drop could partly reverse. Don’t count on relief at the station just yet.
- Mortgages: The Canadian 10-year yield hit its lowest since Aug. 28. Fixed mortgage rates track bond yields, so they could ease if the move holds. Variable-rate and HELOC costs follow the Bank of Canada’s 2.50% policy rate, which hasn’t changed.
- The loonie: At about 71.6 U.S. cents, the Canadian dollar is at a seven-week high, which slightly stretches your dollar on U.S. travel and U.S.-dollar purchases.
- Energy-heavy portfolios: The sector fell 6.2% in a day. If your fund or dividend stocks lean on oil, expect more volatility while the Iran headlines keep moving the price.
What to Watch Today and This Week
| When | Event |
|---|---|
| Thu. noon (London) | Bank of England decision: a hike to 4% from 3.75% is widely expected |
| Thu. 4 p.m. ET | Federal Budget 2026 tabled by Finance Minister François-Philippe Champagne. The Parliamentary Budget Officer projects a $63.3-billion deficit for 2026-27 |
| Thu. (U.S.) | Weekly jobless claims; Arm and Qualcomm results after the bell sent shares lower in extended trading |
| Fri. morning | U.S. October payrolls and Canada’s October jobs report |
Markets rarely move in a straight line after a big election day. The relief rally has two live tests ahead: whether oil keeps falling or rebounds on Iran headlines, and whether the AI selloff in Asia spreads to U.S. tech when Wall Street opens.
Figures reflect Wednesday, Nov. 4, 2026 closes (Thursday, Nov. 5 for Asia-Pacific) and early Thursday trading, cross-checked across TMX, Yahoo Finance, Investing.com, BNN Bloomberg / The Canadian Press, Reuters and CNBC. Index levels can be revised slightly. This article is for general information only and is not investment, tax or legal advice. Consider speaking with a licensed advisor before making financial decisions.
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