TSX Boosted by Hope of New Trade Deal Soon
Canada's main stock index rose on Wednesday, buoyed by renewed optimism for fresh trade agreements between the U.S. and its partner countries after President Donald Trump signaled the possibility of new deals ahead of the looming August 1 deadline.
The TSX Composite Index gained 87.1 points to pause for lunch at 27,451.53.
The Canadian dollar settled 0.03 cents at 73.47 cents U.S.
Trump struck a trade deal with Japan, lowering tariffs on auto imports and sparing Tokyo from punishing new levies on other goods, in exchange for a $550-billion package of U.S.-bound investment and loans.
Meanwhile, prospects of an EU-U.S. trade agreement improved after Trump said on Tuesday that EU representatives would come for trade negotiations on Wednesday.
The news lifted market sentiment and sparked hopes of more U.S. agreements before the August 1 tariff deadline.
On the TSX, industrial stocks experienced the steepest decline among sectors, weighed down by Canadian National Railway, which dropped $5.64, or 4.1%, to $130.92, after missing second-quarter revenue expectations.
Among individual stocks, Zara founder Amancio Ortega's investment vehicle Pontegadea Inversiones, has agreed to acquire a 49% stake in PD Ports from Brookfield Asset Management. The news sent Brookfield's shares up by $2.27, or 2.8%, to $84.92.
Economically speaking, Statistics Canada reports its new housing price index declined 0.2% on a month-over-month basis in June, down for the third consecutive month.
The agency adds prices were down in 12 of the 27 census metropolitan areas surveyed, while prices were unchanged in 10 CMAs and up in the remaining five.
ON BAYSTREET
The TSX Venture Exchange reversed 4.05 points early Wednesday afternoon to 802.33.
All but three of the 12 TSX subgroups were higher, with energy towering 1.1%, while financials and consumer discretionary stocks each up 0.8%.
The three laggards were gold, descending 0.9%, while materials and industrials each lost 0.3%.
ON WALLSTREET
Stocks rose on Wednesday after President Donald Trump announced the U.S. had reached a trade deal with Japan, lifting hope for further agreements being made.
The Dow Jones Industrial Average popped 344.53 points to 44,846.97.
The S&P 500 index gathered 26.05 points to 6,335.67 and had hit a new all-time intraday high,
The NASDAQ marched 35.07 points to 20,927.75..
The run to new highs has sparked so-called animal spirits on Wall Street, with shares of small companies with brand names and questionable finances getting a boost. Kohl’s surged on Tuesday and GoPro and Krispy Kreme were jumping on Wednesday.
Investors are awaiting earnings from Alphabet and Tesla expected Wednesday after the bell. They are the first reports of the earnings season from the megacap technology sector, a group that’s been closely watched given its market leadership in recent years.
Beyond big tech, investors will also monitor reports from Chipotle Mexican Grill and Mattel after the market closes. These releases come amid a busy earnings week. Of the 105 S&P 500 companies that have reported so far this season, more than 86% have posted earnings that surpassed Wall Street’s expectations
Trump said in a Truth Social post Tuesday night that the U.S. had completed a “massive Deal” with Japan. The agreement includes “reciprocal” tariffs of 15% on the nation’s exports to the U.S.
The president also said the U.S. is meeting with European officials in a push to reach a trade deal with the European Union.
The U.S. has been pushing to reach trade deals with other countries ahead of an Aug. 1 deadline. This comes after Trump on April 2 sent markets into turmoil, with his announcement of sweeping tariffs
Prices for the 10-year treasury backslid, raising yields to 4.39% from Tuesday’s 4.34%. Treasury prices and yields move in opposite directions.
Oil prices were off seven cents to $65.24 U.S. a barrel.
Gold prices handed back $49.90 to $3,393.80 U.S. an ounce.
