Introduction
Canada's main stock index remained flat on Wednesday amid volatile trading ahead of U.S. President Donald Trump's announcement on reciprocal tariffs, raising concerns about potential impacts on global economic growth.
Context
The Toronto Stock Exchange's S&P/TSX composite index declined 0.03% to 25,025.74 points after two consecutive sessions of gains.
Trump is expected to outline details of the tariffs at 1600 ET (2000 GMT), an event the White House has called "Liberation Day."
Developments
The tariffs will take effect immediately and are anticipated to lead to:
- Price increases
- Retaliatory actions from affected countries
- Disruption of established trade practices
"We are heading into a very uncertain period and it is going to be a rough ride ... this is a day where people should be already positioned in what they consider to be safer havens," said Michael Sprung, president at Sprung Investment Management.
Communication stocks led the declines on Canada's benchmark index, down 0.8%. Materials stocks fell for the second consecutive session, down 0.6% following lower copper prices. Energy stocks dropped 0.5% as oil prices declined amid concerns that a trade war could reduce demand for crude.
Conclusion
Looking ahead, market participants will focus on Federal Reserve Chair Jerome Powell's speech on Friday for insights into the U.S. economy and interest rate trajectory. Traders expect the Fed to implement three rate cuts this year, though inflation concerns driven by tariffs are adding uncertainty. Among individual stocks, Blackberry plummeted 11.6% after the cybersecurity firm projected weak spending on its products in fiscal 2026.