TSX Ends Week Slightly Lower Amid Trade Policy Uncertainty

Canada's main stock index, the S&P/TSX composite index, finished Friday in positive territory, up 94.43 points at 35,800.89.

The TSX still ended the week slightly lower than where it began. Technology stocks were a bright spot for the TSX this week, gaining about nine per cent, according to Adam Ludwick, director of asset allocation at NEI Investments.

Bank of Canada governor Tiff Macklem's speech on Monday highlighted the unpredictability of U.S. trade policy and its impact on Canadian businesses, which could set back recent economic progress.

Macklem said that businesses had adapted to higher tariffs over the past year, but growth had resumed before the latest escalation in the trade dispute with the United States. The new U.S. tariffs affect nearly $28 billion worth of Canadian goods, and if they remain in place, Macklem warned that the rate of growth for the economy could be roughly halved in the fourth quarter to below one per cent.

Despite this, Ludwick noted that Macklem's 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.