Bay Street Likely To Open With Negative Gap

(RTTNews) - Canadian shares look headed for a gap down start Monday morning with the imposition of 25% tariffs by the Trump Administration on Canadian imports raising fears of a long trade war.

The tariffs came into force after Trump signed an executive order on Saturday. The order exempts energy, which will be subject to a 10% tariff.

The U.S. President has warned that the EU and the UK could be the next targets for the levy.

Canada and Mexico ordered retaliatory tariffs on American goods while China vowed countermeasures. The EU also warned of firm retaliation if targeted.

After US President Donald Trump signed an executive order imposing 25% tariffs on almost everything imported from Canada, outgoing Canadian Prime Minister Justin Trudeau said he had no choice but to impose countermeasures.

On the economic front, the S&P Global's report on Canada manufacturing PMI is due at 8:30 AM ET.

The S&P Global Canada Manufacturing PMI rose to 52.2 in December, up from 52.0 in November. The December reading marks the strongest factory activity in the country since February 2023, and the fourth consecutive month of expansion.

After posting a record close the previous day, the Canadian market opened marginally up and edged higher Friday morning, but kept losing ground as the day progressed with stocks from across several sectors reeling under selling pressure as Trump administration confirmed that it would begin imposing 25% tariffs on imports from Canada from February 1.

U.S. President Donald Trump reportedly said today that nothing can be done by Canada, Mexico and China to forestall tariffs and said that tariffs on oil and gas are likely by Feb. 18.

The benchmark S&P/TSX Composite Index ended with a loss of 275.15 points or 1.07% at 25,533.10. The index gained 0.25% in the week.

Asian stocks slumped on Monday as U.S. President Donald Trump Donald Trump followed through on his promise to impose tariffs on Canada, Mexico and China, and also threatened possible tariffs against the United Kingdom and the European Union, marking a significant trade escalation.

European stocks fell sharply on Monday after U.S. President Donald Trump imposed tariffs on Canada, Mexico and China, and promised to make similar moves against the European Union.

It is feared that a potential trade war could weigh on global economic growth and hit the earnings of major companies.

In commodities, West Texas Intermediate Crude futures are up $1.88 or about 2.59% at $74.41 a barrel.

Gold futures are down $210 or 0.07% at $2,832.90 an ounce, while silver futures are down $0.095 or 0.29% at $32.170 an ounce.