S&P/TSX composite nearly 100 points higher, U.S. markets also rise
The S&P/TSX composite index was up 98.83 points at 27,152.97.
In New York, the Dow Jones industrial average was up 231.49 points at 44,254.78. The S&P 500 index was up 19.94 points at 6,263.70 while the Nasdaq composite was up 52.69 points at 20,730.49.
'The smaller overall moves at the close, they really belie what was some intraday volatility, given the press conference with Trump about his potential intention to try and fire the Fed Chairman (Jerome) Powell,' said Tamsin Wilding, principal and portfolio manager of fixed income at Leith Wheeler Investment Counsel Ltd.
U.S. President Donald Trump sent the U.S. stock market on a jagged round trip after saying he had 'talked about the concept of firing' the head of the U.S. Federal Reserve. Such a move could help Wall Street get the lower interest rates it loves but would also risk a weakened Fed unable to make the unpopular moves needed to keep inflation under control.
Stocks had been rising modestly in the morning, before news reports saying that Trump was likely to fire Fed Chair Jerome Powell quickly sent the S&P 500 down by 0.7 per cent. When later asked directly if he was planning to fire Powell, Trump said, 'I don't rule out anything, but I think it's highly unlikely.' That helped calm the market, and stocks erased their losses, though Trump added that he could still fire Powell.
'What happened here is that we really got a glimpse of what the market reaction function is if Trump did manage to jump through some of those legal loopholes and get Powell ousted,' Wilding said.
She added that the reaction was most apparent in the rates market.
'We saw both quite an aggressive curve steepening come through, front-end yields were lower. That's an anticipation of having a more dovish Fed Chair, who would potentially ease rates at a faster rate than what Powell would,' she said.
'On the flip side, we then saw the long-end yields moving higher. So, just reflecting both those inflationary impulses, less confidence in that fiscal trajectory and debt management, as well as confidence concerns with that.'
In the bond market, the yield on the 10-year U.S. Treasury fell to 4.45 per cent from 4.50 per cent late Tuesday. It had been as low as 4.44 per cent earlier in the day, but it climbed following the reports that Trump was likely to fire Powell.
A new Fed chair friendlier to Trump could mean lower short-term interest rates but also the opposite effect on longer-term yields. That's because a less independent Fed would raise worries that it may also let inflation run higher in the future by being slow to raise interest rates.
On the TSX, Cogeco Inc. shares fell 8.8 per cent as the company reported third-quarter earnings results. It also launched a long-awaited wireless service in Canada.
Cogeco said its profit amounted to $2.13 per diluted share for the quarter, up from $1.97 per diluted share in the same quarter last year.
But analysts took a negative view of the company's results, in which Cogeco also revised its 2025 guidance. Cogeco said it was lowering its revenue projections for the current fiscal year to a 'low single-digit decline,' compared with its previous projection from last October of 'stable' revenue for the year.
The Canadian dollar traded for 72.93 cents US compared with 72.94 cents US on Tuesday.
The September crude oil contract was down 18 cents US at US$65.19 per barrel. The August gold contract was up US$22.40 at US$3,359.10 an ounce.
This report by The Canadian Press was first published July 16, 2025.
— With files from The Associated Press.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD, TSX: CGO)
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