Canadian Stocks Fall As Investors Gauge US Tariff Impact

(RTTNews) - Canadian stocks fell on Thursday as investors resorted to profit-taking from the past two days of record highs and also gauged the impact of high US tariffs taking effect beginning today on Canada's businesses.

After opening just a little above yesterday's record high, the benchmark S&P/TSX Composite Index dropped within minutes and traded in negative territory throughout most of the session before finally closing at 27,761.27, down by 159.60 points (or 0.57%).

Today is a crucial day in Canada's economic calendar as the high tariffs set by the US President Donald Tariff on a vast majority of exporters to the US, including Canada, take effect.

Nevertheless, high-level officials from both countries are sitting at the negotiation table to find a common path to streamline trading between the two neighbors.

Currently, Canada is set to suffer around 35% tariffs on the goods it exports to the US. Fortunately though, a majority of the Canadian exports to its closest neighbor are exempted from tariffs under a previously signed CUSMA deal.

The tariff rates for steel, aluminum, and copper exports to the US stand at 50%.

On the flip side, the Canada-United States-Mexico Agreement lapses by the middle of 2026. While Trump has called for re-negotiations next year, concerns have arise as he may likely call the shots.

On the data front, numbers released by Ivey Business School today revealed that the Ivey Purchasing Managers Index in Canada rose to 55.8 in July from 53.3 in June, above market expectations of 55.2. This signals economic expansion for the second consecutive month.

The yield on the Canadian 10-year government bond hovered near 3.39%.

Over the past few weeks, PM Mark Carney has been taking several steps to balance the economy and build the nation stronger including measures ranging from exploring marketplaces outside the US for its exports - especially Asia - to probing ways to massively cut budgetary spending.

Carney's government has also been engaged in talks with Mexico for improving bilateral trade.

Domestically, Carney is spearheading legislation that allows granting quick federal approvals to big-scale projects deemed important for nation-building.

Based on last week's weak economic data and dismal job numbers in the US, traders expect a rate cut by the US Fed earlier which, if happens, could impact the global stock markets in the coming weeks.

Major sectors that gained in today's trading were Materials (0.73%), Communication Services (0.46%), and Utilities (0.07%).

Among the individual stocks, Lundin Mining Corp (10.52%), Oceanagold Corp (10.30%), BCE Inc (2.06%), and Rogers Communications (1.98%) were the prominent gainers.

Major sectors that lost in today's trading were Industrials (0.82%), Energy (0.88%), IT (1.41%), and Consumer Discretionary (2.32%).

Among the individual stocks, Ats Corp (4.92%), Canadian Natural Resources Ltd (3.04%), Canadian Tire (10.64%), and Restaurant Brands (5.15%) were the notable losers.

Lundin Mining Corp (10.59%) and Enerflex Ltd (10.38%) were among the prime market-moving stocks today.