(RTTNews) – Canadian stocks gained a little on Tuesday as investor sentiment were weighed down by the consequences of a potential U.S. government shutdown.
While losses in crude oil prices, and in turn, the energy sector weighed down on the markets, gains in gold prices, and in turn, the materials sector pulled it up.
Today, after opening a little lower than yesterday’s record high, the benchmark S&P/TSX Composite Index hit a new all-time intraday high of 30,049.81.
The index subsequently turned lower before rebounding late in the session to close at 30,022.81, up by 50.90 points (or 0.17%).
Six of the 11 sectors posted gains today ,with the industrials sector leading the pack.
Concerns about the aftereffects of a U.S. shutdown at midnight compelled investors to take measured steps as the U.S. remains the anchor of global markets.
To prevent the U.S. government from running out of federal funds, a short-term spending bill needs to be approved by the Congress. However, hectic talks between Republicans and Democrats to avert the halting of critical activities have thus far failed, as both sides stick to their demands. Shutdowns in the past have been avoided through a last-minute deal.
U.S. President Donald Trump plans to scale down the size of the federal workforce in the event of a shutdown, leading to lots of workers losing jobs instead of furloughing them as was done during previous shutdowns.
The lack of employees would halt the flow of critical data required by the U.S. Federal Reserve to decide on monetary policy and which allow traders to get a glimpse on the economic outlook.
In addition, last week’s new U.S. tariffs on patented drugs, heavy trucks, furniture, and other items are also taking effect from tomorrow, the implications of which are yet to be comprehended fully.
Yesterday, Trump imposed additional tariffs on imports of softwood lumber and timber (10%), kitchen cabinets and vanities (25%), and upholstered wooden products (25%). These tariffs likely come into effect from October 14.
Notably, Canada is the biggest softwood lumber supplier to the U.S.
Canada has already been hit with 35% tariffs by the U.S. and yesterday’s tariff proclamation by Trump adds to the tariff woes of Canadian domestic businesses.
For the third quarter of 2025, the TSX has overall seen strong momentum, reaching record highs, primarily driven by rising gold prices and resilient energy stocks.
However, with Canada-U.S. trade talks heading noway, analysts feel that a prolonged shutdown in the U.S. – Canada’s largest trading partner – could chip away the global major’s economic credibility and impact Canadian markets too.
Major sectors that gained in today’s trading were Industrials (0.63%), Materials (0.62%), Utilities (0.58%), Consumer Staples (0.30%), and Financials (0.17%).
Among the individual stocks, Aecon Group Inc (2.63%), Stella Jones Inc (4.10%%), Novagold Res Inc (4.06%), New Gold Inc (3.42%), and Aya Gold and Silver Inc (3.07%) were the prominent gainers.
Major sectors that lost in today’s trading were IT (0.21%), Communication Services (0.59%), Consumer Discretionary (0.60%), Energy (1.44%), and Healthcare (4.15%).
Among the individual stocks, Tourmaline Oil Corp (4.34%), Baytex Energy Corp (3.83%), Nuvista Energy Ltd (3.65%), Dye & Durham Ltd (5.61%), and Lightspeed Commerce Inc (3.13%) were the notable losers.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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