Canada's resource-heavy benchmark stock index was down on Monday, pressured by a slide in gold and crude oil prices, while investors assessed domestic and U.S. economic data to gauge the Federal Reserve's monetary policy path.

The Toronto Stock Exchange's S&P/TSX Composite index TSX:TSX fell 0.25% to 35,186.63 points by 11:59 a.m. ET.

  • The materials TSX:TTMT and global gold (.SPTTGD) indexes fell 2.5% and 2.3%, respectively, as bullion prices retreated from a two-week high . Stocks of Canadian miners I-80 Gold Corp TSX:IAU, Eldorado Gold TSX:ELD and Endeavour Silver TSX:EDR were down between 2.9% and 6.9%.

  • Canada's energy index TSX:TTEN dipped 0.4%, tracking a fall in crude prices ICEEUR:BRN1!, NYMEX:CL1! earlier in the day, after the OPEC+ agreed to further raise output targets from August even as exports through the Strait of Hormuz continued to recover, increasing prospects of elevated global supplies.

  • Vermilion Energy TSX:VET and International Petroleum Corporation OMXSTO:IPCO were among the biggest decliners on the energy index, falling 1.3% and 1%, respectively.

  • An S&P Global survey showed that Canada's services economy contracted in June as geopolitical uncertainty and elevated prices hurt demand. However, the recent slide in crude prices has raised expectations of the economy returning to growth.

  • "We're looking at the economy to kind of bounce back from two quarters of flat to negative growth with slightly positive growth," said Michael Dehal, senior portfolio manager at Dehal Investment Partners at Raymond James.

  • "So we're not really concerned on the macro front, given the war is done and inflationary concerns are easing."

  • Last week, the S&P/TSX Composite index hovered near a record high, supported by easing tensions in the Middle East and fading Fed rate-hike expectations following a soft U.S. labor market report.

  • Traders are currently pricing in just one U.S. rate hike by the end of this year, according to LSEG data, while the Bank of Canada is expected to keep interest rates steady this year, with its next policy decision due on July 15.

  • Canada has selected Germany's TKMS to build 12 submarines for its navy, the Globe and Mail reported on Monday, in a move seen as deepening defense ties with Europe.