CANADA STOCKS-TSX rises on energy, mining gains as Middle East conflict widens

By Rashika Singh and Ragini Mathur

March 30 (Reuters) - Canada's resource-heavy main stock index rose on Monday, lifted by mining and energy gains, as firmer commodity prices offset concerns about a widening Middle East conflict.

At 10:37 a.m. ET, the Toronto Stock Exchange's S&P/TSX Composite Index .GSPTSE was up 0.7% at 32,201.91.

Oil prices extended gains on renewed supply disruption worries, with Brent heading for a record monthly rise, while gold rose for a second straight session as safe-haven demand picked up. O/RGOL/

The heavyweight mining .GSPTTMT and energy .SPTTEN sectors were up 1% and 1.2%, respectively, with 10 out of 11 major sectors on the index trading in the green.

But Kevin Headland, co-chief investment strategist at Manulife Investments, advised caution. "We don’t believe oil is going to remain structurally this high for long," he said.

Meanwhile, U.S. President Donald Trump said Washington was in serious discussions with a "more reasonable regime" in Iran to end the war, but repeated his warning that the U.S. would attack Iranian oil wells and power plants if the Middle Eastern country did not reopen the Strait of Hormuz.

His comments come after Yemen's Iran-backed Houthi militia entered the war over the weekend.

High oil prices have helped Canada's commodity-heavy stock index weather a war-shaken March better than the S&P 500, falling about 6.3% during the month versus the U.S. benchmark’s near-7% retreat.

The TSX climbed 2.1% last week, snapping a three‑week losing streak, though it is still on track to close the month with its weakest performance since June 2022.

Elsewhere, a leadership shake‑up weighed on Air Canada, with the airline’s shares AC.TO sliding 2.5% after it announced CEO Michael Rousseau will step down by the end of the third quarter.