Canada’s main stock index edged down on Thursday in volatile trading, as investors remained risk-averse amid an intensifying trade war with the United States.
The Toronto Stock Exchange’s S&P/TSX composite index was down 0.1% at 24,394.32.
Information technology led the declines, falling 2.1% to a four-month low. The sub-index has dropped 17.6% from its record peak a month ago.
Consumer staples and healthcare shed 1.2% each.
“It’s still a very volatile situation and things could change quite rapidly,” said Colin Cieszynski, chief market strategist at SIA Wealth Management, adding the “trade war with the U.S. is a huge risk to Canada”, which is being reflected in the equities.
U.S. President Donald Trump’s wavering trade policies have triggered a global trade war, rattling investors, consumers and business confidence, while increasing recession risks for the United States as well as for Canada.
The Bank of Canada, which delivered a 25-basis point interest rate cut on Wednesday, also raised concerns about inflationary pressures and weaker growth stemming from tariff uncertainties.
TSX falls as Trump hikes tariffs on Canadian metals
Further adding pressures on equities, the Canadian 10-year benchmark yield jumped five basis points at 3.130%.
Wall Street’s benchmark S&P 500 lost 0.7% on Thursday, primarily hit by Trump’s rhetoric to impose a 200% tariff on all wines and other alcoholic products from the European Union.
Trump on Wednesday also threatened to impose additional tariffs on EU goods, as major U.S. trading partners vowed to retaliate against the trade barriers already erected by the U.S. president.
The materials index, however, added 1.4% due to gold prices trading at a near all-time high.
Latest U.S. trade policies have helped gold, an asset preferred by investors amid geopolitical and economic turmoil, gain 12% so far this year.
Birchcliff Energy jumped 12.5%, the biggest individual gainer on the TSX, after it updated its annual average production outlook.
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