TORONTO – Canada’s main stock index moved lower Tuesday, led by losses in the technology and industrial sectors, while U.S. stock markets also fell, led by a 1.7 per cent loss on the Nasdaq.
The fall came after two days of gains, as markets have been swinging daily amid a constant stream of tariff news.
But beneath the volatile surface, investors are continuing to rotate away from growth stocks in areas like tech and toward value stocks, said Kevin Burkett, portfolio manager at Victoria-based Burkett Asset Management.
The S&P/TSX composite index closed down 79.04 points at 24,706.07.
The latest report on inflation in Canada showed prices grew faster last month than economists expected, with the annual inflation rate jumping to 2.6 per cent. Both headline and core numbers surprised to the upside.
After cutting its key interest rate earlier this month, the path for the central bank moving forward is being muddied by the potential effects of the tariffs, Burkett said.
“What they choose to do in the face of that has become more complicated by today’s data.”
The trade war is likely to heat up inflation while also weighing on economic growth.
“We’re coming to the end of this multi-year inflation battle that we were kind of just about to win,” Burkett said, but tariffs are throwing that into question.
The uncertainty is weighing on consumers too, he said.
“Folks are worrying about incomes, the labour market, things of this nature. So there’s a tremendous amount of concern here in Canada around what the outlook is, and that too should trickle into some of the economic data soon.”
In New York, the Dow Jones industrial average was down 260.32 points at 41,581.31. The S&P 500 index was down 60.46 points at 5,614.66, while the Nasdaq composite was down 304.55 points at 17,504.12.
Wednesday will bring the U.S. Federal Reserve’s next interest rate decision.
“There’s an almost zero per cent change of a cut tomorrow,” said Burkett.
Market watchers will be more interested in what chairman Jerome Powell has to say regarding tariffs and the economy, he said, though Powell will likely be careful with his comments.
The Canadian dollar traded for 69.93 cents US compared with 69.91 cents US on Monday.
The May crude oil contract was down 62 cents US at US$66.75 per barrel and the April natural gas contract was up three cents US at US$4.05 per mmBTU.
The April gold contract was up US$34.70 at US$3,040.80 an ounce and the May copper contract was up six cents US at US$5.02 a pound.
— With files from The Associated Press
This report by The Canadian Press was first published March 18, 2025.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD)
