TSX falls on investor concerns over Trump's tariff vows
Updated at 10:10 a.m. ET/ 1510 GMT
By Nikhil Sharma
Nov 26 (Reuters) -Canada's main stock index fell on Tuesday, hurt by energy shares, as President-elect Donald Trump's pledge to impose big tariffs ontop U.S. trading partners, including Canada, weighed on investor sentiment.
The S&P/TSX composite index .GSPTSE was down 117.7 points, or 0.46%, at 25,292.65.
Trump on Monday said he would impose a 25% tariff on imports from Canada and Mexico until the countries clamped down on drugs, particularly fentanyl, and migrants crossing the border.
The proposedmeasures could also violate the terms of a free-trade deal among the United States, Mexico and Canada.
Trump separately outlined "an additional 10% tariff, above any additional tariffs" on imports from China.
"These types of threats are mostly designed to extract concessions," said Angelo Kourkafas, investment strategist at Edward Jones Investments, adding they are, however, "impacting sentiment in the short term."
Canada sends a majority of its exports to the United States, including energy products.
The energy sector fell 2.2% despite higher oil prices, leading sectoral losses,while markets assessed Trump's aim to increase U.S. crude production. O/R
The loonie CAD= fell to its lowest levels since May 2020 against the U.S. dollar.
"A lower Canadian dollar could trigger some inflation concerns for the goods that are imported," Kourkafas said.
The Bank of Canada said inflation should fade into the background again as the annual rate settled back at 2%, allowing consumers and businesses to spend and invest with confidence.
The TSX is expected to rise in 2025 on lower borrowing costs and a cheaper valuation than the U.S. market, but returns could slow after investors potentially front-loaded much of the positive news, aReuters poll found.
Among individual stocks, Alimentation Couche-Tard ATD.TO said it would continue to pursue a deal with Japan's Seven & i 3382.T.
The company, whose shares fell 1%, reported third-quarter earnings below estimates on Monday.
Reporting by Nikhil Sharma in Bengaluru; Editing by Maju Samuel and Shreya Biswas
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