The turmoil from U.S. President Donald Trump’s tariffs continued to roil markets as they opened Monday, with global indexes plunging — including the S&P TSX Composite Index, which dropped by more than 3.5 per cent in the first 10 minutes of trading.
The S&P 500 also briefly entered bear market territory as Trump refused to back down, threatening additional levies on China.
As markets navigate this intense turbulence, here are some terms you might be hearing — and what they mean.
What is a bear market?
A bear market is when a broad market index — like the S&P 500 — drops at least 20 per cent from its previous high. It’s characterized by declining stock prices and pessimistic market sentiment.
“Instead of wanting to buy into the market, investors want to sell, often fleeing for the safety of cash or fixed-income securities,” said the Rhode Island-based Citizens Financial Group.
Entering 2025, there had been 27 bear markets in the S&P 500 since 1928, according to Hartford Funds, a U.S. investment management company. The most famous was the Great Depression; bear markets also happened during the dot-com bubble in the 2000, the 2008 financial crisis and the early days of the COVID-19 pandemic.
Importantly, a bear market is not the same thing as a recession.
What is a recession?
While bear markets only refer to the stock market, a recession means the entire country’s economy is shrinking. Generally, a recession is defined as two consecutive quarters of negative gross domestic product (GDP) growth.
“It can help to see a recession a bit like a thunderstorm,” TD Bank says. “They’re not that much fun while they last, but given time, they always pass.”
Recessions last six to 10 months on average, according to TD. They can be marked by decreased consumer spending, layoffs and decreasing wages.
Canada most recently experienced a brief recession in early 2020, sparked by the start of the pandemic. The last recession before that was the 2008 financial crisis.
A new Bank of Canada survey shows 67 per cent of consumers are anticipating a recession, up 20 percentage points from last quarter. Canadians said they are also feeling more pessimistic about their job security and financial health.
Meanwhile, Prime Minister Mark Carney said Monday that the “probability of recession in the United States has gone up significantly,” and it will be “very hard” for the Canadian economy to avoid significant impacts from it.
What is Black Monday?
Black Monday has been used at multiple points over the last century to refer to large market drops when trading reopens after the weekend. Commentators feared a similar drop could come this week.
Most famously, on Oct. 28, 1929, the Dow Jones industrial average plunged nearly 13 per cent, according to the U.S. Federal Reserve. The next day — likewise nicknamed Black Tuesday — the market dropped nearly 12 per cent. The slide continued for more than two years, signalling the start of the Great Depression, and took 25 years to fully recover.
Likewise, Oct. 19, 1987, is also referred to as Black Monday. The Dow plunged 22.6 per cent that day, the largest single-day stock market decline in history and the first contemporary global financial crisis, according to the reserve.
What is a dead cat bounce?
A dead cat bounce refers to a brief jump in the markets after a period of decline — but the jump is often followed by another drop.
“(It) comes from a saying among traders that even a dead cat will bounce if it’s dropped from a height that’s high enough,” personal finance writer Ashley Kilroy said in a blog post for American finance company SoFi.
