TSX falls marginally on U.S.-China talks stalling, despite GDP growth

Published 30/05/2025, 14:50
Updated 30/05/2025, 21:20
© Reuters.

Investing.com -- Canada’s main stock index finished down on Friday after U.S. President Donald Trump reignited fears of a U.S.-China trade war.

By the 4:00 ET close, the bellwether S&P/TSX 60 index lost 1.6 points or 0.1% in trading, after closing lower by 0.3% on Thursday.

Toronto’s S&P/TSX Composite fell 46.2 points or 0.2% following the previous session, in which the index posted losses of 72.9 points or 0.3%. The composite index has risen 5.4% in the month of May.

Trump accused China of breaking a recent trade truce, saying "China... has totally violated its agreement with us" and "so much for being Mr. Nice Guy!" 

Earlier this month, the two countries agreed to reduce or suspend tariffs, with the U.S. agreeing to lower duties from 145% to 30% and suspending additional tariffs, and China cutting its tax from 125% to 10%. U.S. Treasury Secretary Scott Bessent hinted at this development Thursday, saying trade talks have become "stalled." 

In Canada, wildfires ravaged the provinces of Manitoba and Saskatchewan, with both in a state of emergency. Alberta, with its rich oil fields, was also hit hard with fires, disrupting oil output and putting residents on high alert. 

GDP solid

Canada’s economy posted a modest rebound in March, with real GDP edging up 0.1%, after a 0.2% contraction in February, according to data released by Statistics Canada. The monthly improvement helped boost overall first-quarter growth to 0.5%, while GDP rose at an annualized pace of 2.2%, slightly ahead of the 2.1% pace recorded in the final quarter of 2024, and above the Bank of Canada’s projection of 1.8%.

CIBC (TSX:CM)’s Andrew Grantham said, "While headline GDP growth was solid in Q1, it was flattered by a surge in exports as companies looked to front-run potential US tariffs. Domestic demand was weak during the quarter, and monthly data point towards only slight upward momentum heading into Q2."

U.S. stocks mixed

U.S. stock indexes leaned lower on Friday, as investors assessed the renewed tensions between China and the U.S.

At the 4:00 ET close, the S&P 500 finished lower by 8.5 points or 0.1% and the Nasdaq Composite fell 62.1 points or 0.3. Conversely, the Dow Jones Industrial Average rose by 54.3 points or 0.1%.

In Thursday’s trading, the S&P gained 0.4%, the Nasdaq 0.4%, and the Dow 0.3%. The primary catalyst was tech giant NVIDIA (NASDAQ:NVDA)’s strong earnings, which reaffirmed AI and chip demand, and a blockage of Trump’s "Liberation Day" tariff ensemble by a U.S. federal court, easing trade fears. That blockage has now been paused by the U.S. Court of Appeals.

Crude Oil prices slip ahead of OPEC+ decision 

Oil prices fell Friday and were headed for a weekly loss amid heightened uncertainty over U.S. President Donald Trump’s trade tariffs, with focus turning to an upcoming OPEC+ decision on output. 

By 4:15 ET, Crude Oil WTI Futures was down 0.1%, pricing in at $60.90 a barrel, while Brent Oil Futures dropped 0.8% to $62.83 per barrel.

Benchmark prices were set to lose around 2% this week, heading for a second straight week in red, as uncertainty over Trump’s tariffs and their economic impact weighed on the outlook for demand.  

Gold Futures drop

Gold traded lower on Friday, as the US Dollar Index Futures strengthened and pushed Gold prices down. 

At 4:15 ET, XAU/USD fell 0.8% to $3,292.06/oz, while Gold Futures traded downward by 0.8%, pricing in at $3,317.19/oz.

The Dollar Index was up 0.1%, pricing in at $99.32, by that time. The slight strengthening in the dollar was driven by expectations of fewer Federal Reserve rate cuts.

(Peter Nurse also contributed to this article)

 

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers
© 2007-2025 - Fusion Media Limited. All Rights Reserved.