TORONTO — Canada's main stock index finished lower Friday after U.S. President Donald Trump said he is "terminating" trade discussions with Canada, while U.S. markets hit new highs.
The S&P/TSX composite index was down 59.63 points at 26,692.32.
The TSX had been in positive territory during late-morning trading, but swung the other way Friday afternoon. Trump says he is ending "all discussions on trade with Canada" over Ottawa's plans to push ahead with a digital services tax that takes effect at the end of the month. Trump made the comments in a post on his social media account this afternoon.
Macan Nia, co-chief investment strategist with Manulife Investment Management, said in an interview that Friday's trading day was a "tale of two headlines."
On the positive side, he highlighted economic data from both Canada and the U.S., with U.S. data showing consumers remain resilient. On the other side, Nia pointed to trade uncertainty weighing on equity market sentiment.
"It seems to be some headlines that are coming out of the Trump administration regarding their negotiations with Canada, how they're on hold for now, and I think that took out that positive sentiment that we saw in the first half of the day, that's led to a negative sentiment," he said.
Investors should take Trump's comments as a sign of persisting trade uncertainty, Nia said.
"Today was a reminder to investors who have maybe got a bit complacent in terms of tariff uncertainty, that tariff uncertainty is still front and centre as we move through July and the rest of the summer," he said.
Nia added that while nobody is certain what the Trump administration will do, it is unlikely to make moves that would hurt U.S. growth.
"Our point of view is that the Trump administration is going to be very hesitant to implement policy that will be detrimental to either the U.S. economy or the markets, for that matter ... but this (digital services tax) seems to be a sticking point for the Trump administration, and that's unique," he said.
In New York, the Dow Jones industrial average was up 432.43 points at 43,819.27. The S&P 500 index was up 32.05 points at 6,173.07, while the Nasdaq composite was up 105.54 points at 20,273.46.
The S&P 500 rose 0.5 per cent, finishing above its previous record set in February. The key measure of Wall Street’s health fell nearly 20 per cent from Feb. 19 through April 8. The Nasdaq composite gained 0.5 per cent and set its own all-time high.
The gains on Friday were broad, with nearly every sector within the S&P 500 rising. Nike soared 15.2 per cent for the biggest gain on the market, despite warning of a steep hit from tariffs.
The broader market has seemingly shaken off fears about the Israel-Iran war disrupting the global supply of crude oil and sending prices higher. A ceasefire between the two nations is still in place.
The August crude oil contract was up 28 cents US at US$65.52 per barrel.
At the margin, oil prices have sold off "immensely" following the ceasefire announcement, Nia said.
"There's still a geopolitical premium in oil, it's not much compared to what it was a couple of weeks ago," he said.
The Canadian dollar traded for 73.12 cents US compared with 73.31 cents US on Thursday.
The August gold contract was down US$60.40 at US$3,287.60 an ounce.
This report by The Canadian Press was first published June 27, 2025.
— With files from The Associated Press.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD)
Daniel Johnson, The Canadian Press
