Canada Stocks: Canada stocks advance as investors weigh U.S.-Iran talks, inflation data

Alamos Gold

Mon 15:16

Updates with analyst's quote, context throughout
Gold miners rise as gold rebounds
Canada's annual inflation rate accelerates to 3.2% in May
Traders expect Bank of Canada to raise rates by 25 bps by year-end
TSX rises after three straight days of losses

    June 22 (Reuters) - Canada's main stock index rose on Monday after three consecutive sessions of losses, as investors assessed fragile U.S.-Iran peace talks and a hot domestic inflation report.
The Toronto Stock Exchange's S&P/TSX Composite Index .GSPTSE rose 0.5% to 35,045.74 points by 9:52 a.m. ET.
Gold miners Lundin Gold LUG.TO gained 4.8%, Alamos Gold AGI.TO added 4.5% and G Mining Ventures GMIN.TO rose 3.9% as bullion prices XAU= rebounded from a more than one-week low after Iran reported progress in peace talks with the United States. GOL/
The United States and Iran made "encouraging progress" at the first round of talks aimed at reaching a final peace deal, mediators said, although tension persisted over Lebanon and the Strait of Hormuz.
On the other hand, energy stocks .SPTTEN were among the top losers as crude prices fell. O/R
"Markets could see heightened volatility during the process as this won’t be a simple handshake to get it done,” said Russ Mould, investment director at AJ Bell, referring to the peace talks.
Canada's annual inflation rate in May accelerated more than expected to 3.2%, a 29-month high, data showed, though the reading is unlikely to shift the Bank of Canada's view on underlying inflation.
The central bank said this month it saw limited evidence that higher energy prices were fueling broad-based inflation, as it left its key rate unchanged at 2.25% for the fifth straight meeting. Traders expect a 25-basis-point rate hike before year-end. 
Last week, Canada's banking regulator lowered capital requirements for the country's biggest banks for the first time in three years, a move that will allow them to lend more as the government seeks to boost investment in AI, resources and other areas amid trade and geopolitical uncertainties.
Toronto's S&P/TSX Composite Index .GSPTSE has slipped about 2% from Wednesday’s record high, but remains on course for an eighth straight quarterly gain, its longest winning streak on record.
     
FOR CANADIAN MARKETS NEWS, CLICK ON CODES:
TSX market report .TO
Canadian dollar and bonds report CAD/ CA/
Reuters global stocks poll for Canada EQUITYPOLL1, EPOLL/CA
Canadian markets directory CANADA

(Reporting by Medha Singh in Bengaluru; Editing by Jonathan Ananda)
((Medha.Singh@thomsonreuters.com; +91 80 6210 0592; X, formerly Twitter: @medhasinghs;))