S&P/TSX composite closes higher, U.S. markets up after U.S.-Japan trade deal

Hamilton Spectator

23-07-2025

TORONTO - Gains in consumer and financial stocks helped lift Canada's main stock index to finish higher Wednesday, while U.S. markets reached new highs after the announcement of a U.S.-Japan trade deal.
The S&P/TSX composite index was up 51.98 points at 27,416.41.
In New York, the Dow Jones industrial average was up 507.85 points at 45,010.29. The S&P 500 index was up 49.29 points at 6,358.91, adding 0.8 per cent to its all-time high. Meanwhile, the Nasdaq composite was up 127.33 points at 21,020.02, climbing 0.6 per cent to hit its own record.
'Clearly market participants like another piece of the clarity puzzle falling into place with the arrangement overnight between the U.S. and Japan and also Indonesia and the Philippines yesterday,' said Carol Schleif, chief market strategist at BMO Private Wealth.
U.S. President Donald Trump announced a trade framework that would place a 15 per cent tax on imports coming from Japan. That's lower than the 25 per cent rate Trump had earlier said would kick in on Aug. 1.
'Every piece of clarity that comes through, markets are really liking because they really desperately want to move beyond the tariff issue,' she said.
Trump has proposed stiff taxes on imports from around the world, which carry the double-edged risk of driving up inflation for U.S. households while slowing the economy. But many of Trump's tariffs are currently on pause, giving time to reach deals with other countries that could lower rates. Trump also announced a trade agreement with the Philippines on Tuesday.
Over the long run, Schleif said it is critical for the U.S. to get deals with trading partners like China, Mexico and Canada.
She noted the narrative regarding tariffs has 'shifted more positive.'
Ahead of the looming Aug. 1 tariff deadline, when a pause on a slew of U.S. tariffs is set to expire, Schleif said market participants don't seem overly concerned.
'I think the lesson learned all year is that the deadlines are meant to try to accelerate the conversation, not necessarily as a hard and fast rule,' she said.
'President Trump and his administration clearly want to get stuff done and done quickly, and they don't have patience for the way diplomacy usually works, where it takes a very long time and lots of handshakes and lots and meetings. They're definitely having lots of meetings, but it's on an accelerated schedule, and they're trying to get a lot of this stuff buttoned up.'
Going forward, Schleif said she expects equity markets to face some tailwinds.
'Globally, there are a lot of questions about how much longer this can persist. But the interesting thing is the dynamics on the globe are pretty positive for equity markets,' she said.
On the TSX, Canadian National Railway Co. was one of the largest downside contributors a day after it cut its outlook amid trade volatility.
CN shares finished 4.17 per cent lower on Wednesday.
The Canadian dollar traded for 73.48 cents US compared with 73.34 cents US on Tuesday.
The September crude oil contract was down six cents US at US$65.25 per barrel. The August gold contract was down US$46.10 at US$3,397.60 an ounce.
This report by The Canadian Press was first published July 23, 2025.
— With files from The Associated Press.
Companies in this story: (TSX: GSPTSE, TSX: CADUSD, TSX: CNR)