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A global benchmark and two key European indexes hit new highs on Tuesday while the U.S. dollar rose in anticipation of faster inflation as volatility eased to lows last seen in February 2020 before the coronavirus pandemic.

Canada’s main stock index rose as data showing a surprise domestic trade surplus in April.

The Toronto Stock Exchange’s S&P/TSX composite index was unofficially up 30.62 points, or 0.15%, at 20,065.92.

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Energy stocks finished up 0.4% with oil prices settling at the highest in more than two years after the top U.S. diplomat said that even if the United States were to reach a nuclear deal with Iran, hundreds of U.S. sanctions on Tehran would remain in place.

That could mean additional Iranian oil supply would not be re-introduced into the market soon.

“I would anticipate that even in the event of a return to compliance with the JCPOA (2015 Joint Comprehensive Plan of Action), hundreds of sanctions will remain in place, including sanctions imposed by the Trump administration,” U.S. Secretary of State Antony Blinken said.

Brent crude rose 73 cents, or 1%, to close at $72.22 a barrel, the highest it has settled since May 2019. U.S. West Texas Intermediate oil rose 82 cents, or 1.2%, to settle at $70.05 a barrel, highest since October 2018.

Also leading the index higher were the industrials sector, which gained 1%, and health care stocks, rising 0.7%.

The materials sector fell 0.5% with gold dropping as a firmer greenback countered a slip in U.S. Treasury yields as investors looked ahead to U.S. inflation data that could influence the Federal Reserve’s timeline to taper monetary support.

Spot gold was down 0.4% to $1,892.33 per ounce, while U.S. gold futures settled down 0.2% at $1,894.40.

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The Canadian dollar fell against its broadly stronger U.S. counterpart on Tuesday, but stayed within its recent trading range as data showed a surprise Canadian trade surplus and investors awaited a Bank of Canada interest rate decision.

The Canadian dollar was trading 0.3% lower at 1.2115 to the greenback, or 82.54 U.S. cents, having pulled back from a six-year high last week at 1.2007. It’s weakest level since mid-May was 1.2144.

“The CAD is generally trading in tandem with its G10 peers today, in what appears to be an environment of modest, broad-based USD strength,” said Eric Theoret, global macro strategist at Manulife Investment Management.

“The currency has been range bound for over a month now, trading within a remarkably narrow range following its solid run into the start of May,” Theoret added.

The loonie has been supported in recent months by higher commodity prices and a more hawkish stance from the Bank of Canada.

The central bank is widely expected to leave its key interest rate on hold at 0.25% on Wednesday and through the rest of 2021. But it could cut the pace of its bond purchases once gain as soon as next quarter, a Reuters poll showed.

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Canada posted a trade surplus of $594-million in April, as imports fell at a much faster rate than exports, Statistics Canada said. Analysts had predicted a deficit of $700-million.

Wall Street stocks struggled for closing gains on Tuesday as a lack of clear market catalysts kept institutional investors in a holding pattern, while retail traders kept the rally of so-called meme stocks alive.

All three major U.S. stock indexes ended the range-bound session near flat or higher.

The tech-laded Nasdaq fared best, with Amazon.com Inc and Apple Inc providing the biggest boost.

“We’re waiting for inflation numbers, waiting for more from the (Federal Reserve), waiting for earnings season,” said Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago. “There’s not a lot motivating the market today.”

“We’re in this twilight zone until probably right after the Fourth of July, when we see earnings season kick in,” Nolte added.

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The CBOE volatility index, a measure of investor anxiety, touched its lowest level in over a year.

Smallcaps, once again buoyed by the ongoing meme stock retail frenzy, were outperforming their larger counterparts.

Clover Health Investments seized top billing among meme stocks, and ended the session as the largest percentage gainer in the Nasdaq.

Other stocks whose recent explosive trading volumes have been attributed to social media buzz, including GameStop Corp , Bed Bath & Beyond Inc, Workhorse Group and others ended sharply higher.

“(Meme stocks) are where the action is, but you flip it over and look crypto and that’s a mess,” Nolte said. “Now the meme stocks are taking over from crypto as the place to be and it’s all a consequence of very easy monetary policy.”

Reports from the U.S. Labor Department and National Federation of Independent Business appeared to confirm a labor shortage even as demand roars back to life, which could put upward pressure on wages, a precursor to wider inflation.

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Market participants look to Thursday’s consumer price index data for further clues regarding inflation, and how it could influence the Federal Reserve’s timetable for tightening its monetary policy.

Unofficially, the Dow Jones Industrial Average fell 31.67 points, or 0.09%, to 34,598.57, the S&P 500 gained 0.71 points, or 0.02%, to 4,227.23 and the Nasdaq Composite added 43.19 points, or 0.31%, to 13,924.91.

Sales of Tesla Inc’s China-made electric cars jumped in May by 29%, marking a 177% year-on-year increase, according to the China Passenger Car Association. The stock erased initial gains on the news.

Boeing Co was lifted by Southwest Airlines’ announcement that it had ordered 34 new 737 MAX aircraft, but the planemaker’s shares pared early gains.

GameStop, the company most closely associated with the Reddit-driven short squeeze phenomenon, is expected to report quarterly results after markets close on Wednesday.

Yields on U.S. Treasury debt fell to their lowest in more than a month, while euro zone bond yields nudged down with markets in a wait-and-see mood ahead of a European Central Bank policy meeting and U.S. inflation data, both due on Thursday.

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The 10-year U.S. Treasury note fell 4.2 basis points to 1.528%, suggesting bond investors don’t see a pick-up in inflation, despite nagging jitters over the Federal Reserve’s insistence a rise in consumer prices will be transient.

Markets have been quiet before the release of second-quarter earnings in July when very strong results will be reported as a year ago they were so dismal, said Peter Tuz, president of Chase Investment Counsel in Charlottesville, Virginia.

“Knowing there’s a strong earnings season coming takes away some worry,” Tuz said, keeping share prices from falling. “The markets are about as flat and quiet as they can be today.”

MSCI’s all-country world index, a U.S.-centric benchmark for global equity markets rose 0.02% to 717.17 after earlier scaling a fresh intraday high.

In Europe, the pan FTSEurofirst 300 index added 0.08% to close at a new record high, while the STOXX 600 index rose 0.15% to also set a new closing high.

Telecoms, travel and real estate shares in Europe led equity markets higher, but weak German industrial output data and doubts that Britain will lift remaining pandemic restrictions later this month capped gains.

The travel and leisure index rose 1.8%, supported largely by gains in low-cost carrier easyJet after Goldman Sachs upgraded the stock to “buy.”

Reuters

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