TORONTO – Canada’s main stock index finished more than 400 points lower on Friday, while U.S. markets also fell as tariff threats came back into focus.
Ian Chong, a portfolio manager at First Avenue Investment Counsel Inc., said it is “never a good feeling” to finish the week on “such a large drawdown.”
He said markets had been performing well leading up to Friday’s trading session until comments from U.S. President Donald Trump regarding his nation’s trading relationship with China rattled Bay and Wall Streets.
Stocks had been heading for a slight gain in the morning, until Trump took to his social media platform and said he’s considering “a massive increase of tariffs” on Chinese imports.
“This adds to the heightened geopolitical risk and macro uncertainty that we’re seeing. But, as seen in prior confrontations between the U.S. and China, both parties do eventually return to the table to resume negotiations,” Chong said.
“It’s just a question of when and what details will eventually be hammered out.”
The S&P/TSX composite index was down 419.09 points at 29,850.89.
In New York, the Dow Jones industrial average was down 878.82 points at 45,479.60. The S&P 500 index was down 182.60 points at 6,552.51, while the Nasdaq composite was down 820.20 points at 22,204.43.
Trump’s upset at restrictions China has placed on exports of its rare earths, which are materials that are critical for the manufacturing of everything from consumer electronics to jet engines.
The heightened tensions between the world’s two largest economies caused a widespread drop on Wall Street, with four out of every five stocks within the S&P 500 falling. Everything sank from big tech companies like Nvidia and Apple to shares of smaller companies looking to get past uncertainty about tariffs and trade.
Chong also noted the impact on equity markets was compounded by high valuations that leave “very little” room for any potential bad news.
He said Trump’s comments were a “reminder of the existing risk,” which took a toll on markets Friday.
“That said, this greater uncertainty should be very supportive for gold as a flight to safety,” he said.
The December gold contract was up US$27.80 at US$4,000.40 an ounce.
Meanwhile, investors digested labour market statistics in Canada that showed an unexpected increase in hiring.
Statistics Canada said the unemployment rate held steady at 7.1 per cent in September as the economy added some 60,000 jobs in the month. That topped economists’ expectations for a gain of 5,000 jobs in September and marks a rebound from losses of more than 100,000 positions over the previous two months.
The September jobs report marks the Bank of Canada’s last look at the labour market before its next interest rate decision on Oct. 29.
“The job numbers and the lower probability of rate cuts in Canada is also a bit of a headwind because people were expecting easing monetary policy,” Chong said.
The Canadian dollar traded for 71.43 cents US, unchanged from Thursday.
The November crude oil contract was down US$2.61 cents US at US$58.90 per barrel.
This report by The Canadian Press was first published Oct. 10, 2025.
— with files from The Associated Press.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD)
