Hello everyone,
It has been an exceptionally volatile month, with markets experiencing sharp swings both to the upside and downside. At the time of this writing, the S&P 500 is down 1.41% (https://ycharts.com/indices/%5ESPX/level), for the month, while the TSX has posted a modest gain of 0.6%. Notably, strength in the Canadian market has been supported primarily by the financial sector, which has delivered a strong return of 6.89% (https://ycharts.com/indices/%5ESPTSXCFIN/level).
The real big news for the month, of course, was what appears less like a fully settled “peace deal” and more like a ceasefire or de-escalation frameworks tied to reopening the Strait of Hormuz and reducing oil-market disruption. Oil prices have declined modestly by about 5 to 6%, suggesting that markets had already priced in some level of easing tensions and remain cautious about full implementation. While the agreement reduces immediate supply risks, the recovery in oil flows is expected to be slow due to logistical, security, and insurance constraints (of course); meaning supply will not return to normal levels quickly. At the same time, global oil inventories remain low following sustained drawdowns, reinforcing a tight physical market despite improved sentiment, which aligns with prior internal analysis highlighting persistent supply constraints and elevated volatility risks.
The muted price reaction also reflects growing market skepticism, with investors increasingly focused on actual tanker traffic and supply restoration rather than policy announcements alone. Geopolitical risks remain elevated, as past ceasefire agreements have proven fragile and vulnerable to sudden escalation, ie. President Trump tweets, particularly in the broader region. As a result, oil prices are likely to remain range-bound but volatile in the near term, with a bias toward the $80–$90/bbl range given ongoing supply tightness and lingering uncertainty (https://economics.td.com/ca-us-iran-peace-deal).
As for who really benefits, the biggest immediate benefactor is likely global consumers and oil-importing economies because lower crude prices reduce pressure on gasoline, transportation, food, and input costs. China, India, and other large Asian importers also benefit because they are heavily exposed to imported energy and had been facing growth downgrades from the oil shock. TD Economics (https://economics.td.com/ca-us-iran-peace-deal) noted that China and India had buffers, reserves, or access to alternative supply, but they still stood to gain from easing energy pressure.
What really stood out for me was where this peace-deal was signed. For President Trump, who insisted to sign the agreement then and there (https://www.cnn.com/2026/06/20/politics/inside-trump-iran-agreement), Versailles would be a highly symbolic choice and not exactly a subtle one. The palace carries a long historical shadow as a place associated with imposed settlements, national humiliation, and attempts to rebuild order after conflict. Signing a Middle East peace or ceasefire agreement there would inevitably invite comparisons to the Treaty of Versailles after the First World War, which formally ended the war with Germany but also became linked to resentment, reparations, and wounded national pride. In that sense, I believe the venue would not simply say “peace agreement”; it could also whisper (rather loudly for a palace), “be careful what kind of peace this becomes.”
The optics could still serve a clear political purpose. For President Trump, Versailles would frame the agreement as historic and grand, more than a technical ceasefire and closer to a major reset in the international order. It could also signal pressure on Iran if the deal were viewed as the result of military, economic, or diplomatic leverage. That is powerful symbolism, but it comes with risk: the lesson of Versailles is that humiliation can create future instability rather than lasting reconciliation. If regional actors or the Iranian public read the location as a deliberate nod to capitulation, it could hand hardliners an easy talking point. In short, I believe Versailles would be memorable, dramatic, and historically loaded - which makes excellent theatre, but potentially questionable diplomacy.
However, one could argue that this outcome has had unintended consequences for the United States. Under the current arrangement, Iran is now imposing transit fees of up to $2 million per vessel passing through the Strait of Hormuz, (https://www.cbc.ca/news/world/trump-iran-strait-of-hormuz-tolls-9.7246282) while also benefiting from a $300 billion fund (https://www.reuters.com/business/finance/iran-deal-includes-300-billion-fund-more-than-half-which-already-committed-2026-06-16/), of which more than half has already been committed. In contrast, prior to the conflict; the Strait was open, shipping traffic flowed freely without tolls, and Iran had not accrued this level of financial gain. Viewed through this lens, the situation suggests a strategic outcome that may not have unfolded entirely in the U.S.’s favor. What did Prime Minister Carney say? Middle powers must overcome superpowers….lol.
Getting back on track, for financial markets, this setup implies a shift from acute shock to controlled uncertainty, which typically supports risk assets but keeps volatility elevated. The modest decline in oil prices potentially reduces immediate inflation pressure, which may be incrementally positive for equities (especially consumer and rate-sensitive sectors) and for bonds, as it will likely lower the risk of further policy tightening. However, because oil supply recovery is slow and inventories remain tight, energy prices are likely to stay relatively elevated, meaning inflation risks are reduced but not eliminated, keeping central banks cautious. In practical terms, this environment points to range-bound commodities, gradually improving risk sentiment, and continued market volatility rather than a clean “risk-on” or “risk-off” regime shift.
And just to sprinkle some more good news, historically speaking, in the past 20 years, July stands out as one of the better months for stock performance, with average gains reported near 2.3%. Making July statistically one of the strongest months for the stock market (https://www.carsongroup.com/insights/blog/here-comes-the-best-month-according-to-the-past-20-years/). This positive seasonality is often attributed to factors such as reduced volatility during the mid-summer period and corporate earnings announcements that can drive upward momentum. But let's keep in mind, we have volatility and we have strong corporate earnings thus far. So, it's a split, we're batting 500 (like the Toronto Blue Jays currently). Overall, July’s historical data suggests it's a month where cautious optimism prevails, providing a favorable environment for equity markets, though investors remain attentive to economic signals and global events that can introduce short-term fluctuations.
In closing, markets were volatile in June, with modest overall index performance as geopolitical developments in the Middle East shifted markets from crisis toward cautious stabilization, easing oil prices slightly but leaving supply tight and volatility elevated. This environment supports risk assets but keeps investors focused on uncertainty, while seasonal trends suggest July could deliver modest, historically consistent gains despite ongoing rotations and headline risk. In short, we’re moving from panic to “nervous optimism”, kind of like markets just switched from espresso to decaf… still jittery, just slightly more polite about it.
The information contained herein has been provided by Rietze Duke & Associates Wealth Management and is for information purposes only. The information has been drawn from sources believed to be reliable. Graphs and charts are used for illustrative purposes only and do not reflect future values or future performance of any investment. The information does not provide financial, legal, tax or investment advice. Particular investment, tax, or trading strategies should be evaluated relative to each individual's objectives and risk tolerance.
Commissions, management fees and expenses all may be associated with investments in exchange-traded funds (ETFs). Please read the prospectus and ETF Facts before investing. ETFs are not guaranteed, their values change frequently and past performance may not be repeated. ETF units are bought and sold at market price on a stock exchange and brokerage commissions will reduce returns.
Certain statements in this document may contain forward-looking statements (“FLS”) that are predictive in nature and may include words such as “expects”, “anticipates”, “intends”, “believes”, “estimates” and similar forward-looking expressions or negative versions thereof. FLS are based on current expectations and projections about future general economic, political, and relevant market factors, such as interest and foreign exchange rates, equity and capital markets, the general business environment, assuming no changes to tax or other laws or government regulation or catastrophic events. Expectations and projections about future events are inherently subject to risks and uncertainties, which may be unforeseeable. Such expectations and projections may be incorrect in the future. FLS are not guarantees of future performance. Actual events could differ materially from those expressed or implied in any FLS. A number of important factors including those factors set out above can contribute to these digressions. You should avoid placing any reliance on FLS.
Source: London Stock Exchange Group plc and its group undertakings (collectively, the “LSE Group”). © LSE Group 2026. FTSE Russell is a trading name of certain of the LSE Group companies. “FTSE®”, “Russell®”, and “FTSE Russell®” are trademarks of the relevant LSE Group companies and are used by any other LSE Group company under license. “TMX®” is a trademark of TSX, Inc. and used by the LSE Group under license. All rights in the FTSE Russell indexes or data vest in the relevant LSE Group company which owns the index or the data. Neither LSE Group nor its licensors accept any liability for any errors or omissions in the indexes or data and no party may rely on any indexes or data contained in this communication. No further distribution of data from the LSE Group is permitted without the relevant LSE Group company’s express written consent. The LSE Group does not promote, sponsor or endorse the content of this communication. Index returns are shown for comparative purposes only.
Indexes are unmanaged and their returns include reinvestment of dividends, if applicable, but do not include any sales charges or fees as such costs would lower performance. It is not possible to invest directly in an index.
Links to other websites are for convenience only. No endorsement of any third-party products, services or information is expressed or implied by any information, material or content referred to or included on or linked from or to here.
TD Asset Management Inc. is a wholly-owned subsidiary of The Toronto-Dominion Bank.
Rietze Duke & Associates Wealth Management is part of TD Wealth Private Investment Advice, a division of TD Waterhouse Canada Inc. which is a subsidiary of The Toronto-Dominion Bank.
®The TD logo and other TD trademarks are the property of The Toronto-Dominion Bank or its subsidiaries.
