BofA’s Hartnett says concentrated U.S. stock returns are likely to persist
Investing.com - Canada’s main stock index exchange settled lower Friday, after U.S. President Donald Trump ramped up his trade war with one of his country’s biggest trading partners.
The S&P/TSX Composite was down almost 60 points, or 0.22% at 27,023.25.
Trump announced late Thursday that the U.S. would impose a 35% tariff on Canadian imports next month and planned to impose blanket tariffs of 15% or 20% on most other trading partners.
Trump told Canadian Prime Minister Mark Carney, in a letter released on his social media platform, the new rate would go into effect on August 1 and would go up if Canada retaliated.
The 35% tariff is an increase from the current 25% rate that Trump had previously assigned to Canada, although an exclusion for goods covered by the United States-Mexico-Canada Agreement on trade was expected to stay in place, and 10% tariffs on energy and fertilizer were also not set to change.
Canada is the second-largest U.S. trading partner after Mexico, and the largest buyer of U.S. exports. It bought $349.4 billion of U.S. goods last year and exported $412.7 billion to the U.S., according to U.S. Census Bureau data.
Trump has broadened his trade war in recent days, setting new tariffs on a number of countries, including allies Japan and South Korea, along with a 50% tariff on copper.
Elsewhere, Canada’s employment report for June is due later in the session, and could provide clues on how the domestic economy is dealing with trade uncertainty and guide expectations for the Bank of Canada’s July interest-rate decision.
U.S. slip on trade uncertainty
U.S. stock slipped lower Friday, retreating from record levels after President Trump’s latest trade announcement stirred concerns over global economic growth.
The Dow Jones Industrial Average was down 280 points, or 0.63%, the S&P 500 lost 22 points, or 0.36%, and the Nasdaq Composite lost 45 points, or 0.22%.
The main Wall Street indices ended higher Thursday, with the S&P 500 and Nasdaq Composite posing new closing records, but sentiment has been jolted by President Trump announcing that a 35% tariff rate would be imposed on all Canadian goods from August 1.
The major averages were little changed this week, with the Dow Jones Industrial Average hovering just under the flat line on a weekly basis and the S&P and Nasdaq higher by less than 1%.
Oil prices tick lower
Oil prices rose Friday on growing expectations of additional sanctions on Russia, although gains have been capped by tariff worries and increased OPEC+ production.
Brent futures climbed 2.46% to $70.33 a barrel.
Both contracts lost more than 2% on Thursday as investors worried about the impact of Trump’s evolving tariff policy on global economic growth and oil demand.
However, sentiment has received a boost after Trump expressed frustration with Russian President Vladimir Putin due to the lack of progress on peace with Ukraine, raising the potential for further sanctions on the major oil producer.
Gold prices rise
Gold prices rose Friday, recouping some recent losses after safe haven demand was buoyed by U.S. President Donald Trump threatening more trade tariffs.
Spot gold rose 1.18% to $3,363.19 an ounce.
Elsewhere, silver and platinum were set for strong weekly gains, vastly outperforming gold as they notched fresh multi-year highs this week.
Among industrial metals, U.S. copper futures fell sharply from recent peaks, seeing some profit-taking after Trump’s tariff threat drove stellar gains in the red metal earlier this week.