Canadian Market Reacts to Trade War Fears and Earnings Updates

Canadian market closes lower amid trade war tensions. Investors analyze earnings reports from major banks, revealing mixed results.

Date: 28-02-2025

AI Rating: 6

Earnings Insights: Royal Bank of Canada reported a net income of C$5.011 billion, with EPS of C$3.54, an increase from C$3.522 billion or C$2.50 EPS year-over-year, reflecting positive revenue impacts. Canadian Imperial Bank of Commerce's adjusted net income stood at $2,179 million, showing a growth in EPS from $1.81 to $2.20. Toronto-Dominion Bank reported an adjusted net income of $3,632 million with EPS slightly increasing from $2.00 to $2.02.

Market Overview: The benchmark S&P/TSX Composite Index fell by 0.79%, losing 200.12 points. The market's decline was influenced by trade war fears, particularly due to President Trump's announcement of tariffs on Canada, Mexico, and China. This has led to widespread caution among investors, particularly affecting sectors like materials, technology, and realty.

Sector Performance: Many individual stocks suffered losses, with notable declines in companies like Endeavour Mining and Bombardier Inc., while a few, like Veren, benefitted from better-than-expected earnings. This highlights the volatility and selective performance amid broader market concerns regarding tariffs.

Income and Earnings Reports: The statistics provide insights into the Canadian economy's health, indicated by a widening current account deficit but also a positive trend in average weekly earnings. The reported 5.8% year-on-year increase in earnings might suggest a strengthening labor market despite the growing deficit.

Stocks: RY CM TD