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Canada’s main stock market rose slightly on Tuesday as investors looked ahead to a packed week of corporate earnings and assessed the potential impact of new U.S. trade tariffs. As of 12:05 PM ET, the S&P/TSX 60 futures were up just 1 point, or 0.06%, while the Toronto Stock Exchange’s S&P/TSX composite index gained 25.32 points to reach 27,342.32, a rise of 0.09%.
The cautious optimism in Canadian markets mirrors a mixed session on Wall Street. The Dow Jones Industrial Average added 20 points, the S&P 500 gained 6 points (0.1%), and the tech-heavy Nasdaq slipped by 30 points (0.1%). While the S&P 500 and Nasdaq had touched record highs earlier this week, markets appear to be taking a breather as investors prepare for a wave of quarterly earnings reports.
In the U.S., the spotlight is on major companies like Google-parent Alphabet and electric vehicle maker Tesla, both of which are set to report earnings on Wednesday. These reports are expected to provide insight into how large firms are coping with rising tariffs and uncertain economic conditions.
So far, the earnings season has gotten off to a strong start. About 12% of S&P 500 companies have reported their results, with 86% surpassing earnings expectations and 67% beating revenue estimates. This strong performance has helped push stocks to new highs in recent days.
However, not all companies are delivering positive surprises. General Motors reported better-than-expected second-quarter earnings, but its stock fell over 4% as profits declined due to weaker performance in North America. Meanwhile, homebuilder D.R. Horton impressed investors with earnings that exceeded expectations, driven by strong home delivery figures.
Later today, chipmaker Texas Instruments and medical device firm Intuitive Surgical are scheduled to release their earnings, adding more fuel to an already busy week.
Markets remain sensitive to developments on the policy front, particularly around trade. U.S. President Donald Trump has announced sweeping new tariffs on a range of goods, with rates between 20% and 50% targeting key trade partners. Starting August 1, the U.S. will also impose a 50% tariff on copper imports and has threatened to raise duties on pharmaceuticals to 200%. These moves are adding to concerns about inflation and global trade tensions.
The Federal Reserve is expected to leave interest rates unchanged during its upcoming meeting next week, but uncertainty remains. Fed Chair Jerome Powell is scheduled to speak later today, though he may avoid policy commentary due to the central bank’s blackout period before meetings.
In commodities, oil prices dropped on fears that the escalating U.S.-EU trade conflict could weigh on global demand. Brent crude fell 1.53% to $68.15 a barrel, while West Texas Intermediate slipped 1.61% to $64.89 a barrel. Both benchmarks had already edged lower on Monday.
Gold prices eased slightly after hitting a one-month high. Spot gold was up 1% at $3,429.91 per ounce, and futures climbed 1.1% to $3,444.25 per ounce. The metal had surged 1.4% on Monday as investors sought safety amid growing trade and interest rate concerns.
Overall, markets in both Canada and the U.S. are trading with a cautious tone, balancing optimism from strong earnings with growing uncertainty over trade policy and the future of interest rates.