TSX reaches 5-week highs as US trade tariffs are held back
Investors expressed relief at the news that President Donald Trump would not impose immediate U.S. tariffs on Canada.
The Toronto Stock Exchange S&P/TSX Composite Index closed up 103.66, or 0.4% at 25,171.58, marking its fifth consecutive day of gains, and highest closing level since December 13.
A Trump administration official confirmed that Trump would issue a general trade memo on his first day of office. The memo will not impose new tariffs but will direct federal agencies to evaluate U.S. trading relationships with China Canada and Mexico. Trump had threatened to impose a 25% immediate tariff on Canadian goods.
Greg Taylor, portfolio manager at Purpose Investments, said that there was a collective relief. This is likely to be more measured than many had feared, and that's the reason we're now seeing more green in the screen and a little bounce today for energy stocks and materials.
The trading volume was lower than usual due to the U.S. market being closed on Martin Luther King Jr. Day.
Taylor stated that "tomorrow, we'll have a much better idea once more players return but for now, I'm happy with the start of these next four years."
Bank of Canada: Canadian firms are optimistic about sales and demand in the next year, thanks to interest rate reductions, but they're worried about potential damage caused by U.S. policy promises.
Industrials grew by 0.8% thanks to a 7.2% gain in shares of Bombardier Inc., a business jet exporter.
Energy rose 2.3%, despite the lower oil price. Canadian Natural Resources Ltd., Canada's biggest oil and gas producer added 4.4% to its shares.
Gold prices increased, resulting in a 1.2% increase for the Materials group. Reporting by Fergal in Toronto, and Nikhil in Bengaluru. (Editing by Tomaszjanowski, Mark Potter and David Gregorio).
(source: Reuters)
