Bay Street's Financial District is seen in Toronto with a Canadian flag on display, Friday, August 5, 2022. (Photo: Nathan Denette/The Canadian Press)
Canada’s main stock market saw a solid boost on Monday, gaining almost 200 points despite quiet trading due to U.S. markets being closed for Memorial Day. The S&P/TSX composite index rose by 193.18 points to close at 26,073.13, with tech and industrial shares leading the rally.
A major standout on the market was ATS Corporation. The company’s stock skyrocketed more than 20% after announcing it had reached a US$135 million settlement with a customer in the electric vehicle industry over unpaid bills. The news sent a wave of confidence through the tech and industrial sectors, helping to push the index higher.
However, not all companies had a positive day. Ivanhoe Mines Ltd. took a hit, dropping over 16% as it continued to face delays in underground operations at its copper mine in the Democratic Republic of Congo. Seismic activity in the region has made it unsafe to proceed, adding uncertainty to the company’s outlook.
South of the border, all major U.S. stock and commodities markets were closed in observance of Memorial Day, meaning lower overall market activity. With no fresh signals from Wall Street, investors in Canada are now turning their attention to the upcoming Bank of Canada interest rate decision, scheduled for June 4.
According to Kevin Burkett, a portfolio manager at Burkett Asset Management in Victoria, it’s likely that the central bank will keep interest rates unchanged. He noted that Canada may find it tough to lower rates unless the U.S. makes a similar move, which seems unlikely at this time.
“The market has more or less accepted that we can’t make rate cuts in Canada if the U.S. isn’t doing the same,” Burkett explained.
Investors are also closely watching developments from the White House. U.S. President Donald Trump announced Monday that he would postpone a 50% tariff on European goods until July 9. Just days earlier, Trump had warned that tariffs could start on June 1 due to stalled trade talks with the European Union. These shifting positions are leaving investors uneasy.
Burkett believes there’s still a strong chance that these tariffs will be enforced and could hurt global trade more than the Trump administration expects. He added that while recent Canadian consumer data has shown a slight improvement in confidence, political tensions remain a big concern.
"People seem a bit less panicked than a month ago," he said. "But Trump’s pattern of fiery statements is likely to continue."
To navigate the uncertainty, Burkett has shifted focus toward companies that provide everyday essentials—like Loblaw and Dollarama—rather than those that rely on consumers spending extra money, such as BRP or Cineplex. He believes essentials-focused businesses are more stable in unpredictable markets.
As Canada watches the global economy closely, the TSX’s rise shows that investors are still willing to place their bets—though they’re being more cautious about where.
