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You are at:Home » Stocks sink on Bay and Wall Streets, but loonie rises following new tariffs
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Stocks sink on Bay and Wall Streets, but loonie rises following new tariffs

By favofcanada.caAugust 1, 2025No Comments4 Mins Read
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Stocks are opening lower on Wall Street and Treasury yields are falling sharply after the government reported a sharp slowdown in hiring last month. Markets are also reacting early Friday to the latest tariff news.

The S&P 500, the Dow Jones Industrial Average and the Nasdaq composite were each down between roughly 1.7-2.5 per cent as of 10:00am EST. The surprisingly weak hiring numbers led investors to step up their expectations for an interest rate cut in September.

Meanwhile, the Toronto Stock Exchange was down close to 1.5 per cent as of 10:00am EST, and the Canadian dollar got a big boost by close to half a cent compared to the U.S. dollar.

President Donald Trump issued a new set of sweeping import duties that will apply to dozens of countries as of Aug. 7.

World shares retreated Friday after President Donald Trump issued a new set of import duties that will apply to dozens of countries as of Aug. 7 after Trump announced tariff rates of up to 41 per cent for imports from dozens of countries across the globe.

The White House said the tariff for products from Canada would rise to 35 per cent, effective Friday.

The order pushed back the tariff deadline earlier set for Aug. 1 and injected a new dose of uncertainty in an already unpredictable process that has been rattling markets since Trump returned to the White House in January.

This is not the end of the story, Stephen Brown of Capital Economics said in a commentary, adding that “this is unlikely to be the final word, as it still seems likely that some other countries will reach their own deals with the U.S., while there is a chance that the U.S. courts will eventually strike down these tariffs.


In early European trading, Germany’s DAX fell 1.8 per cent to 23,630.99. Britain’s FTSE 100 dropped 0.6 per cent to 9,081.99. In Paris, the CAC 40 shed 2.1 per cent to 7,608.60.

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Asian markets also declined, with South Korea’s Kospi tumbling 3.9 per cent to 3,119.41 as shares in market heavyweight Samsung Electronics dropped 3.5 per cent.

Japan’s Nikkei 225 slid 0.7  per cent to 40,799.60 as Japanese officials said they were watching closely for details and progress on implementing an agreement calling for 15 per cent tariffs on exports to the U.S.

Hong Kong’s Hang Seng index shed 1.1 per cent to 24,507.81, while the Shanghai Composite slipped 0.4 per cent to 3,559.95. The status of China’s trade talks with the United States remains unclear, but are separate from Trump’s announcement late Thursday.

Australia’s S&P ASX 200 shed 0.9 per cent to 8,662, India’s BSE Sensex lost 0.7 per cent to 80,837.19 and Taiwan’s TAIEX slid 0.5 per cent to 23,434.38.

“Trump’s new tariff directive, signed behind closed doors just ahead of the Aug. 1 deadline, slaps a new floor under global trade costs: a 10 per cent minimum rate for nearly all partners, with surcharges of 15 per cent or higher for surplus nations,” with Canada drawing particular ire, Stephen Innes of SPI Asset Management said in a commentary.

“This wasn’t just an update — it was a structural rewrite. The average U.S. tariff jumps from 13.3 per cent to 15.2 per cent, a seismic shift from the 2.3 per cent average before Trump retook office. This reshapes the cost calculus for everything from semiconductors to copper pipes,” he said.

Trading on Wall Street on Thursday brought more losses after an early big tech rally faded and a health care sector pullback led the market lower.

The S&P 500 fell 0.4 per cent, its third straight decline. The benchmark index, which is just below the record high it set Monday, notched a 2.2 per cent gain for the month of July and is up 7.8 per cent so far this year.

The Dow Jones Industrial Average lost 0.7 per cent and the Nasdaq composite closed less than 0.1 per cent lower.

Roughly 70 per cent of stocks in the S&P 500 lost ground, with health care companies accounting for the biggest drag on the market.

Health care stocks sank after the White House released letters asking big pharmaceutical companies to cut prices and make other changes in the next 60 days. Eli Lilly & Co. fell 2.6 per cent, UnitedHealth Group slid 6.2 per cent and Bristol-Myers Squibb dropped 5.8 per cent.

In other dealings early Friday, U.S. benchmark crude oil shed 70 cents to $68.56 per barrel, while Brent crude, the international standard, gave up 69 cents to $71.01 per barrel.

The U.S. dollar fell to 150.30 Japanese yen from 150.77 yen. The euro rose to $1.1418 from $1.1417.

&copy 2025 The Canadian Press

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