Someone snapped a photo of the TMX Market Centre in Toronto (Photo: THE CANADIAN PRESS/Paige Taylor White)
Canada’s main stock index nudged higher Tuesday, while U.S. markets closed with mixed results as investors kept one eye on an upcoming U.S. tariff deadline set for August 1.
The S&P/TSX composite index climbed by 47.43 points, ending the day at 27,364.43. South of the border, the Dow Jones industrial average gained 179.37 points, closing at 44,502.44. The S&P 500 added a modest 4.02 points to reach 6,309.62, while the Nasdaq composite slipped 81.49 points, closing at 20,892.69.
Investors Quiet Before the Tariff Storm
Despite the looming tariff decision, stock activity remained surprisingly quiet. A pause on several U.S. tariffs is set to expire August 1, yet there’s little urgency or panic in the markets.
Michael Currie, a senior investment adviser with TD Wealth, noted the change in attitude. “Back in March and April, this was all anyone talked about. Now, it’s barely mentioned,” he said.
According to Currie, companies are no longer in the dark. Most have crunched the numbers, assessed the risks, and are openly telling shareholders how they plan to handle the situation.
“There’s still some uncertainty, but it’s not a mystery anymore,” Currie explained. “Businesses are adapting to the reality that the tariffs are likely staying. The difference is — they’re prepared now.”
Global Trade Talks in Motion
There may be some relief ahead. Ongoing negotiations with international partners are aimed at softening the impact of tariffs. On Tuesday, U.S. President Donald Trump announced a new trade agreement with the Philippines, a move that could influence other pending deals.
However, not all companies are feeling optimistic. Shortly after the markets closed Tuesday, Canadian National Railway (CN Rail) revised its earnings forecast, citing "high levels of macroeconomic uncertainty" stemming from trade and tariff unpredictability. The rail giant also withdrew its outlook for 2024 to 2026 entirely.
U.S. Earnings Paint a Mixed Picture
In the U.S., corporate earnings were a mixed bag. General Motors (GM) surprised analysts by beating expectations, but the news was overshadowed by its tariff warning. GM stock dropped 8.2% after the company confirmed it still expects to lose $4–5 billion this year due to tariffs, though it hopes to recover about 30% of that hit.
Lockheed Martin shares tumbled nearly 11% after it reported a $1.6 billion one-time charge tied to its aeronautics and helicopter segments during the second quarter.
Meanwhile, homebuilders were the day’s bright spot. D.R. Horton stock surged 17% and PulteGroup rose 11.5% after both reported stronger-than-expected earnings.
Investors Taking a Wait-and-Watch Approach
As markets flirt with all-time highs, some investors are choosing caution over action. Currie noted that this time of year often sees less activity.
“We’re heading into a typically slow season,” he said. “People aren’t selling off, but they’re also not eager to pour in more money just yet. They’re holding back, waiting for a more favorable moment.”
Market Snapshot
- Canadian dollar: 73.34 cents US (up from 73.03 cents US Monday)
- Crude oil (September contract): Down 64 cents to US$65.31
- Gold (August contract): Up US$37.30 to US$3,443.70
