TORONTO — Canada’s main stock index continued to climb Friday amid tech and financial gains, extending a nearly two-week run as markets bank on averting trauma from tariffs threatened by President Donald Trump.
The S&P/TSX composite index rose 34.41 points to 25,468.49.
“Overall, the market is moving quite mildly,” said Kevin Burkett, president of Victoria-based Burkett Asset Management.
“The main driver is technology,” he said, noting that Shopify Inc. and Constellation Software Inc. enjoyed modest gains.
Energy and industrials weighed on the TSX, however.
In the U.S, markets took a breather Friday after the S&P 500 posted a record high the day before.
In New York, the Dow Jones industrial average fell 140.82 points to 44,424.25. The S&P 500 index dipped 17.47 points to 6,101.24, while the Nasdaq composite dropped 99.38 points to 19,954.30.
Defensive sectors — utilities, telecoms and consumer staples — performed better Friday, while technology stocks saw mild losses, Burkett noted.
“Underneath the surface of a mildly negative day, what you see is repositioning across sectors, portfolio managers starting to turn defensive. That’s not surprising because U.S. equities are off to a flying start to the year."
Bullish views on Trump’s pro-business stance, aversion to regulations and promised corporate tax cuts have overwhelmed apprehensions south of the border, while Canadian markets remain strikingly resilient in the face of tariff threats.
The 47th president suggested this week his administration could move ahead with 25 per cent across-the-board tariffs on Canadian imports as soon as Feb. 1.
“I think markets have been surprisingly complacent in the face of pretty scary rhetoric around Canadian trade,” Burkett said. Since Jan. 13, the S&P/TSX has climbed nearly four per cent.
That attitude stems partly from uncertainty around whether the tariff wall will go up, or how permeable it would be.
Burkett highlighted "jarring" threats — "but threats lacking sufficient specificity" to hobble markets.
“If you’re an investor in Canadian equities today, I think you have no choice but to be somewhat reactive to surprising and erratic trade discourse.”
Energy, mining, industrial and financials comprise much of Canada’s main stock market. Whether those areas will be exempt from the blow of import duties remains unknown, Burkett said.
In the U.S., the aggressive start to the year in equities goes hand-in-glove with a president who proclaimed on Thursday that “America is back and open for business,” Burkett said.
“You really have to be a Donald Trump true believer to be incrementally buying stocks at these (price) levels,” he said.
A full slate of U.S. earnings next week including four Magnificent Seven companies, plus decisions this Wednesday by the central banks of Canada and the U.S. on whether to cut key interest rates will be the main drivers of markets next week, he said.
The Bank of Canada is expected to cut its key interest rate again, while the U.S. Federal Reserve is poised to hold, said Burkett.
The Canadian dollar traded for 69.75 cents US compared with 69.58 cents US on Thursday.
The March crude oil contract was up four cents at US$74.66 per barrel and the March natural gas contract was down two cents at US$3.45 per mmBTU.
The February gold contract was up US$13.90 at US$2,778.90 an ounce and the March copper contract was down less than a penny at US$4.32 a pound.
This report by The Canadian Press was first published Jan. 24, 2025.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD, TSX:SHOP, TSX:CSU)
Christopher Reynolds, The Canadian Press
