TORONTO – Canada’s main stock index closed up along with U.S. markets on a choppy day that showed hints of cooling trade tensions while the head of the U.S. Federal Reserve warned of rising risks.
The S&P/TSX composite index closed up 186.46 points at 25,161.18 as most sectors rose, led by technology and industrials.
The energy sector saw mixed results as the price of crude was under pressure again. Suncor Energy Inc. was down 2.8 per cent after reporting earnings, while Enbridge Inc. was up 1.84 per cent.
Investor focus was likely more drawn to the U.S. however as the Federal Reserve made its latest rate decision.
The central bank kept its key rate unchanged, while Fed chair Jerome Powell warned U.S. tariffs could lead to slower economic growth and rising unemployment.
The Fed commentary showed a bit of a shift in tone, said Michael Greenberg, portfolio manager for Franklin Templeton Investment Solutions.
“They did change some language around uncertainty, i.e. it going up, although I don’t know how much of a surprise that really is.”
Powell’s warning around stagflation could mean the Fed is a little less inclined to react to bad economic news, given the fears around inflation, said Greenberg.
“It suggests they might be a little bit more patient, and so really the only adjustment we’re seeing in the market today on rate cuts is just the probability of a June cut going down.”
Along with the Fed decision, there was also an announcement of high-level talks between U.S. and Chinese officials this weekend in Switzerland.
The news of talks is positive but clearly still quite preliminary, said Greenberg.
“Talking is always better than not talking, so that in itself would be a positive sign that we’re looking for, but to see tariffs go back to where they were is probably pretty unlikely.”
After moving up and down through the day, key U.S. markets ended up as a whole.
In New York, the Dow Jones industrial average was up 284.97 points at 41,113.97. The S&P 500 index was up 24.37 points at 5,631.28, while the Nasdaq composite was up 48.50 points at 17,738.16.
The Canadian dollar traded for 72.48 cents US compared with 72.55 cents US on Tuesday.
The June crude oil contract was down US$1.02 at US$58.07 per barrel and the June natural gas contract was up 16 cents US at US$3.62 per mmBTU.
The June gold contract was down US$30.90 at US$3,391.90 an ounce and the July copper contract was down 12 cents US at US$4.66 a pound.
This report by The Canadian Press was first published May 7, 2025.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD)
