Joseph Lawler, seen at the center in the foreground, is surrounded by fellow traders inside their booth at the New York Stock Exchange on Friday, July 18, 2025. (AP Photo/Richard Drew)
Canada’s main stock index slipped lower on Friday, dragged down by losses in industrial stocks, while U.S. markets closed with mixed results amid a quiet trading atmosphere.
The S&P/TSX composite index closed down by 72.92 points, settling at 27,314.01. Meanwhile, in the U.S., the Dow Jones Industrial Average fell 142.30 points to 44,342.19. The S&P 500 ticked down slightly by 0.57 points, ending at 6,296.79. However, the Nasdaq nudged higher by 10.01 points, closing at 20,895.66.
According to Steve Locke, chief investment officer for fixed income and multi-asset strategies at Mackenzie Investments, the day was unusually calm compared to recent weeks. “It didn’t feel like a volatile day—less action than we’ve seen lately,” he noted.
Possible Impact from U.S. Railway Merger Talks
A key influence on the Canadian market could be tied to buzz around a major U.S. rail merger. Norfolk Southern’s stock jumped 2.5% following reports that it may be in talks with Union Pacific to form a mega-railroad stretching from coast to coast. If completed, it would become the largest railway in North America. However, such a deal would face major regulatory scrutiny.
Union Pacific’s shares, in contrast, dipped 1.2%—likely due to concerns about how the merger might be received by U.S. authorities. While Canadian companies aren’t directly involved in the talks, Locke explained that businesses in the same sector or connected supply chains can still feel ripple effects from such industry changes.
Netflix, American Express Slide Despite Strong Earnings
In the U.S., some major companies released better-than-expected earnings, but their stock prices still fell. Netflix shares dropped 5.1%, despite strong profits. Analysts weren’t surprised by the fall, pointing out that the stock had already risen 43% this year—much higher than the S&P 500's performance.
Similarly, American Express posted solid financial results, but its shares fell 2.3%. Experts cited signs of slower growth in key metrics, such as the number of new credit cards issued, as a reason for the market’s reaction.
Currency Moves and Market Outlook
The Canadian dollar was slightly stronger on Friday, trading at 72.89 cents U.S., up from 72.71 cents the day before. Locke observed that the U.S. dollar has been rebounding recently after months of weakness earlier in the year. However, he expects that trend to reverse over the next few quarters, with the U.S. dollar likely softening again, especially against the Canadian dollar.
Commodity Prices
Oil prices dipped slightly, with the September crude contract falling by 18 cents to settle at US$66.05 per barrel. In contrast, gold prices rose, with the August contract up by US$13 to US$3,358.30 an ounce.
