CANADA STOCKS-TSX set for near seven-month low amid US-China trade war

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CANADA STOCKS-TSX set for near seven-month low amid US-China trade war

, Reuters - 11:13 AM ET 4/4/2025 default

(Updates with morning prices)

By Sanchayaita Roy

April 4 (Reuters) -

Canada's main stock index fell sharply on Friday as investors reacted to mounting global trade tensions following China's retaliatory measures against U.S.

reciprocal tariffs

Toronto Stock Exchange's S&P/TSX composite index fell 5% to 23,118.61 points, its lowest since 11 September 2024 if losses hold.

China on Friday retaliated with additional tariffs of 34% on all U.S. goods from April 10, intensifying a trade war between the two leading global economies and amplifying fears of a recession.

"There is going to be this idea that whatever U.S. does, we are going to do back the same, and that is obviously not good for the markets," said Allan Small, senior investment advisor at Allan Small Financial Group with iA Private Wealth.

On Thursday, Canadian Prime Minister Mark Carney announced a limited set of counter measures against U.S. tariffs.

Heavyweight energy sector led the declines on TSX, falling 9.7%, as oil prices

plunged 8%

and are headed towards their lowest close since the midst of the coronavirus pandemic in 2021.

Materials sector fell 7.9%, tracking the

decline

in base metals, with copper on track for its biggest weekly slide since the early days of the 2020.

Gold prices

fell

more than 1%, as traders liquidated their bullion positions amid broader market selloffs.

Information technology stocks touched their lowest in seven months, down 3%. Celestica ( CLS ) fell nearly 8%, the steepest drop in the sector.

On the data front, U.S. Labor Department reported a

higher-than-expected job increase

in March, but Trump's tariffs may weaken the labor market as business confidence drops.

Canada's

unemployment rate ticked up

in March.

Investors will also be watching Federal Reserve Chair

Jerome Powell's speech

at 11:25 a.m. ET for clues on the path of interest rates cuts.

(Reporting by Ragini Mathur and Sanchayaita Roy in Bengaluru; Editing by Sahal Muhammed)

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