TSX Down 190 Points at Midday With All Sectors Lower

12:09 PM EDT, 03/21/2025 (MT Newswires) -- The Toronto Stock Exchange is down 191 points at midday with all sectors lower.

The biggest decliners are miners and telecoms, down 2.6% and 2%, respectively.

Oil prices weakened early on Friday as the trade wars pushed by U.S. President Donald Trump threaten to slow growth while supply is on the rise. Gold edged down from a record high as the dollar rose, pausing a run of eight days of gains that came on safe-haven demand amid worries U.S. trade policies will slow major economies.

Canada stock pickers got another indication of the potential chaos that a full blown trade war with the U.S. could create as retail sales slumped in January and likely remained weak in February. According to Statistics Canada's flash estimate, retail sales pulled back further February, falling by 0.4%.

Retail sales declined by 0.6% month on month in January, following December's outsized gain of 2.6% (previously reported as 2.5%). The result missed e Statistics Canada's advanced estimate of 0.4%. After adjusting for inflation, the volume of retail sales posted a sizeable decline of 1.1% m/m in January.

TD Economics, in looking at the key implications, said consumers "tightened their belts" to start the year. Since sales are reported in nominal terms, part of the decline may reflect a temporary drop in prices due to the HST/GST holiday, TD added, pointing out that the pullback was even more pronounced in real terms.

Looking ahead, TD said "uncertainty looms". "Our internal credit and debit card statistics points to a slight softening in spending through the first quarter, consistent with today's reading and the advance estimate for February. While there may be some stockpiling ahead of tariffs in March any boost would likely be short-lived. Consumers remain cautious and may restrain spending further until there is more clarity on the outlook for jobs, incomes and prices. We've penciled in a 2.7% (annualized) growth in consumer spending for Q1, and potentially a contraction in the following quarters."

CIBC said the Canadian dollar and bond yields decreased modestly on the downside surprise in January and the downbeat February estimate. It noted consumer spending was "clearly improving" in response to lower interest rates in the second half 2024. And looking through the volatility shows a normalization in activity in the first quarter following the start of the GST holiday. However, tariff uncertainty may inject caution into consumption ahead on concerns around employment prospects, depending on the April 2nd tariff outcome. Consumption is likely to slow over the first half of the year, but accelerate in the second half and 2026 if a worst-case tariff scenario is avoided, CIBC added.

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