financetom
Market
financetom
/
Market
/
TSX Closer: The Index Sinks as U.S. Trade and Sovereignty Threats Continue
News World Market Environment Technology Personal Finance Politics Retail Business Economy Cryptocurrency Forex Stocks Market Commodities
TSX Closer: The Index Sinks as U.S. Trade and Sovereignty Threats Continue
Mar 13, 2025 1:28 PM

04:15 PM EDT, 03/13/2025 (MT Newswires) -- The Toronto Stock Exchange sank on Thursday as investors seem to doubt a meeting of Canadian and U.S. government officials set to begin shortly in Washington will turn down the temperature around a brewing trade war and sovereignty threats from Donald Trump.

The S&P/TSX Composite Index closed down 220.11 points to 24,203.23. Among sectors, Information Technology (-3.23%), posted the biggest loss. Base Metals, up 2.11%, is the sole gainer.

Staying on sectors, Marius Jongstra, vice-president, market strategy at Rosenberg Research published a note where he noted markets have started to price in odds of a recession, and recommends tactically increasing defensive exposure in response.

"Market implied recession odds are on the rise as tariff-induced uncertainty bumps up against waning economic activity. The implication for investors, as GDP estimates get ratcheted lower, is to reduce overall portfolio risk until more clarity emerges on the path ahead. We recommend tactically increasing defensive sector exposure in the equity portfolio, while simultaneously overweighting fixed income relative to stocks. Interestingly, those with a higher risk tolerance can start to chip away at commodities (oil), looking through near-term volatility, which have discounted a higher risk of recession compared to financial assets," he wrote in a executive summary.

This comes as U.S. President Donald Trump upped the stakes in his global trade war by again threatening the economy and sovereignty of Canada, threatening excise taxes on European wines and alcohol and talking about annexing in Greenland.

Amid signs of a widening trade dispute, the World Trade Organization confirmed Thursday that Canada has requested dispute consultations with the United States over the imposition of U.S. import duties on steel and aluminum products from Canada. The request was circulated to WTO members on March 13, a statement said. It noted Canada claims the measures, which terminate Canada's exemption from additional duties on certain steel and aluminum products and increase duties on aluminum articles, which took effect on March 12, are inconsistent with U.S. obligations under the General Agreement on Tariffs and Trade (GATT) 1994.

Fortunately, perhaps, National Bank notes that "though clearly important," equities "aren't be-all and end-all for Canadians," based on Canadian household exposure to equity markets in Statistics Canada's quarterly national balance sheet accounts data released today.

"Seemingly taking a cue from their American cousins, Canadian households now possess unprecedented equity exposure too. At C$5.16 trillion, the market value of equity and investment fund shares comprised 47% of Canada's total household financial assets at the end of 2024. Clearly then, a serious/sustained loss of traction in equities could handicap a Canadian household sector increasingly worried about job prospects and still contending with cost-of-living pressures. Relatively speaking, however, equity portfolios aren't the be all and end all in Canada. For the average household north of the border, more wealth continues to be tied up in real estate/housing," National Bank wrote.

True, National Bank said, real estate's share of total Canadian household assets is off its peak. But at roughly 40%, housing remains more important to the average household in Canada than in the United States.

"Notwithstanding the concentration of assets/wealth at higher-income levels, non-financial assets (primarily real estate) account for a more meaningful share of assets for the lower-income Canadians we remain most concerned about.... All this makes the recent bout of housing market paralysis worrisome. While an imperfect tool for a trade war, looser monetary policy may well be needed to reinvigorate this interest rate-sensitive and undeniably important asset class in Canada," National Bank added.

Of commodities today, West Texas Intermediate crude oil closed down as the International Energy Agency said it expects higher global demand this year to be accompanied by rising inventories, while cautioning its outlook is clouded by U.S. trade wars. WTI oil for April delivery closed down $1.13 to settle at US$66.55 per barrel, while May Brent crude was last seen down $1.13 to US$69.82.

But gold traded at a record high late afternoon on Thursday even as the dollar rose after another report showed U.S. inflation cooled last month, while safe-haven buying continues as U.S stock markets tumble again amid Donald Trump's tariff threats. Gold for April delivery was last seen up $49.90 to US$2,996.70 per ounce, topping the Feb.24 record close of US$2,963.20.

Comments
Welcome to financetom comments! Please keep conversations courteous and on-topic. To fosterproductive and respectful conversations, you may see comments from our Community Managers.
Sign up to post
Sort by
Show More Comments
Related Articles >
Japanese bond market pauses before expected tariff salvo
Japanese bond market pauses before expected tariff salvo
Mar 31, 2025
SINGAPORE, April 1 (Reuters) - Japanese government bonds took a breather on Tuesday following their sharpest jump in eight months, as investors awaited the next round of tariff announcements from the United States. The benchmark 10-year Japanese government bond yield rose 1.6 basis points to 1.51%, after falling 10 bps over the previous two sessions, the steepest drop since August....
Nikkei pinned to 8-month low as US tariffs loom
Nikkei pinned to 8-month low as US tariffs loom
Apr 1, 2025
(Updates to close) TOKYO, April 1 (Reuters) - Japan's Nikkei struggled for headway on Tuesday and was pinned near an eight-month low as traders braced for another round of painful U.S. tariffs, likely to hit sales of Japanese exporters. The Nikkei index closed more or less flat at 35,624.48, having failed to sustain the morning's bounce. The benchmark had logged...
XPeng, Ultralife And 3 Stocks To Watch Heading Into Tuesday
XPeng, Ultralife And 3 Stocks To Watch Heading Into Tuesday
Apr 1, 2025
With U.S. stock futures trading lower this morning on Tuesday, some of the stocks that may grab investor focus today are as follows: Wall Street expects Ultralife Corp. ( ULBI ) to report quarterly earnings at 15 cents per share on revenue of $40.00 million before the opening bell, according to data from Benzinga Pro. Ultralife ( ULBI ) shares...
Euro zone bond yields inch lower as traders await US tariffs
Euro zone bond yields inch lower as traders await US tariffs
Apr 1, 2025
LONDON, April 1 (Reuters) - Euro zone bond yields inched lower on Tuesday, reversing some of the previous session's safe-haven fuelled rally as traders await details of U.S. President Donald Trump's reciprocal tariffs on Wednesday. Investors are also eyeing euro zone PMI and flash CPI data due later in the session. Germany's 10-year bond yield, the benchmark for the euro...
Copyright 2023-2025 - www.financetom.com All Rights Reserved