(RTTNews) – Canadian stocks gained modestly on Friday, with strong earnings from banking stocks over the week generating buying interest along with the release of domestic economic data that has triggered rate cut expectations.
After opening just below yesterday’s close, the benchmark S&P/TSX Composite Index rallied to an intraday high of 28,607.30 past noon and finally settled at 28,564.45, up by 129.65 points (or 0.46%).
Indicating the squeezing effects of US tariffs on Canadian exports, data released by Statistics Canada today revealed that Canadian GDP contracted by 1.6% on a seasonally adjusted, annualized rate in the second quarter 2025, with GDP declining by 0.4% from the first quarter. Real GDP edged down 0.1% month-on-month in July.
Household spending jumped by 4.5% on an annualized basis. Gains were observed for durables, semi-durables, and services.
Export of goods dropped 7.5%, led by a 24.7% plunge in passenger cars and trucks. Industrial machinery exports fell by 18.5%. Travel slid 11.1%.
Traders see this as the consequence of the ongoing trade war between Canada and its largest trading partner, the US, and have stepped up rate cut bets by Bank of Canada at their September meeting even though next week’s jobs data is a parameter the BoC will look into before making a decision.
A research report by job posting website Indeed reveals that August openings in the tech sector were down 19% from their early 2020 levels, indicating a hiring freeze.
The BoC speculated in its July report on monetary policy that the Canadian economy would contract somewhere around 1.5% during the second quarter.
The Bank of Canada has kept rates steady at 2.75% at its last three meetings since March.
The country has been slapped with 35% tariffs on all its exports to the US excluding those falling under Canada-US-Mexico Agreement. The levies particularly target steel, aluminum, and auto sectors.
Prime Minister Mark Carney’s government has sent a high-level delegation to talk with their US counterparts to find a mid-path in the ongoing trade war. Recently, he announced withdrawal of retaliatory tariffs imposed on US imports to pave way for smoother dialogue between the two nations.
Carney has accelerated efforts to build major ports, railways, and energy grids to reshape the economy that had relied on US majorly for all these years.
Canada is also exploring marketplaces outside the US for its exports.
On the earnings front, this week, top Canadian banks reported growth in their quarterly profits.
Major sectors that gained in today’s trading were Materials (2.22%), Healthcare (1.62%), Consumer Staples (0.87%), and Consumer Discretionary (0.59%).
Among the individual stocks, Endeavor Silver Corp (6.19%), Seabridge Gold Inc (5.64%), Equinox Gold Corp (5.63%), and Bausch Health Companies Inc (3.36%) were the prominent gainers.
Major sectors that lost in today’s trading were Communication Services (0.13%), Utilities (0.32%), Energy (0.32%), and IT (0.82%).
Among the individual stocks, Celestica Inc Sv (8.46%), Computer Modelling Group (2.05%), Athabasca Oil Corp (2.43%), Cenovus Energy Inc (2.14%), and Transalta Corp (2.34%) were the notable losers.
Brp Inc (7.43%) and Nexgen Energy Ltd (5.98%) were among the prime market-moving stocks today.
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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