Canada’s main stock index was in positive territory on Friday, but still finished the week slightly lower than where it began.
The S&P/TSX composite index was up 94.43 points at 35,800.89.
Adam Ludwick, director of asset allocation at NEI Investments, said technology stocks were a bright spot for the TSX this week, gaining about nine per cent.
This week, investors monitored a speech on Monday by Bank of Canada governor Tiff Macklem, who said the unpredictability of U.S. trade policy has heightened uncertainty for businesses and could set back the recent progress of the Canadian economy.
Macklem said that businesses had spent the last year adapting to higher tariffs and that growth had resumed. But that was before the latest escalation in the trade dispute with the United States.
Trump’s latest tariffs affect nearly $28 billion worth of Canadian goods. Macklem said if the new U.S. tariffs remain in place, the rate of growth for the economy could be roughly halved in the fourth quarter to below one per cent.
Macklem said it isn’t going to be easy, but the economy is showing resilience.
Ludwick said the speech reflected a more nuanced view of the Canadian economy compared with the central bank’s September decision to hold interest rates. The central bank kept its key rate on hold at 2.25 per cent earlier this month, but financial markets have raised the odds of an interest rate hike later this year in recent weeks.
He said the speech highlighted the idea that the central bank doesn’t want to be “too late to hike rates and inflation proves to be stubborn.”
“Obviously citing the Middle East conflict as the main driver due to the price of oil. If we do see an October rate hike, that’s going to shift some things in Canada. And right now I think the market is pricing that as a coin flip,” Ludwick said.
He said shifting headlines regarding the latest developments in the U.S. war with Iran also affected oil prices this week and had “cascading effects on Canada.”
On Thursday, Statistics Canada said retail sales fell 0.7 per cent to $73.7 billion in July as sales at general merchandise retailers slowed. However, the agency said its early estimate for August pointed to a gain of 1.3 per cent for that month, though it cautioned the figure would be revised.
“It’s nice to see the retail sales bounce, but there are other overhangs, I think, that are impacting investor sentiment a little bit more than that,” Ludwick said.
Next week on Tuesday, Statistics Canada will release its report for gross domestic product for July.
“A softer print there could be concerning. You can have a really difficult dynamic where growth is slowing, but inflation is persistent. That’s not an ideal environment for equity (or) for the economy,” Ludwick said.
The agency’s preliminary estimate released last month suggested real GDP was essentially unchanged in July as increases in the real estate and rental and leasing sector and professional, scientific and technical services were offset by decreases in retail trade and manufacturing.
In New York on Friday, the Dow Jones industrial average was up 478.64 points at 51,828.62. The S&P 500 index was up 39.28 points at 7,743.41, while the Nasdaq composite was up 129.34 points at 27,068.72.
The Canadian dollar traded for 70.70 cents US compared with 70.74 cents US on Thursday.
The November crude oil contract was down US$2.20 at US$92.41 per barrel.
The December gold contract was up US$23.20 at US$4,321.20 an ounce.
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Daniel Johnson, The Canadian Press
This report by The Canadian Press was first published Sept. 25, 2026.
