Below is a summary of some of the relevant news items from the Capital Markets and the Economy from the past week extracted from RBC Global Insights and FactSet Research.

You can catch up on the past four weeks’ Weekly Update in the link to my Blog.

Read my latest Smart Investor newsletter on my website. The Q2 2025 edition covers Market Review for Q1 2025, the impact of tariffs on markets, and how to position your portfolio during a time of disruption. Shiuman’s Corner is about the art of retail in Japan.

Markets

Market scorecard as of close on Friday July 11, 2025.

Country	Equity Indices	Level	1 week	YTD
Canada	S&P/TSX Composite	27,023	0.0%	9.3%
U.S.	S&P 500	6,260	-0.3%	6.4%
U.S.	NASDAQ	20,586	-0.1%	6.6%
Europe/Asia	MSCI EAFE	2,648	-0.2%	17.1%

Source: FactSet

• TSX finished lower on Friday, off worst levels. Sectors mixed. Commodities the top performers, led by energy and materials. Canadian equities finish the week mostly intact, down 0.04%. Tariff talk an overhang as Trump said he would hit Canada with a 35% tariff rate on 1-Aug, talked about a higher baseline tariff of 15-20% on most trading partners. However, also the usual chatter about how these threats may not come to fruition.
• US equities were lower in Friday trading, though stocks finished off worst levels. Came after S&P 500 and Nasdaq set fresh record closes Thursday. Both indexes also slightly lower for the week as S&P 500 broke two-straight weekly gains.
• Investors may have expected the re-emergence of "Liberation Day" tariff levels and an amalgamation of sector-specific tariffs to lead to a similar market reaction as we saw back in April. Back then, equity market volatility rose sharply. But that has not been the case this time around. Markets have been more resilient in the wake of these significant announcements, likely because they have been through this before and may be questioning the U.S. administration’s ability and willingness to follow through. There is also some confidence that the economic and earnings trajectory has not been unduly impacted by the uncertainty created earlier this year by the tariff threats.
• We remain cognizant of downside risks given stock markets are sitting close to highs, leaving them vulnerable to a negative shock or disappointment. Nevertheless, markets may remain resilient until there are more concrete signs that the uncertainty, threats, or tariffs themselves are having some sort of tangible impact on inflation, economic growth, and potentially future corporate earnings. As of now, this hasn't been the case.

Economy

Canada

• Canada’s economy contracted modestly by 0.1% m/m in April, falling back from 0.1% m/m GDP growth in March and coming in below Bloomberg consensus expectations of flat growth. Trade-related sectors were notably impacted, specifically in the manufacturing and wholesale industries.
• The monthly Canadian labour market data is notoriously volatile, but the 83k jump in June employment was the largest rise since December. That gain along with the tick down in the unemployment rate to 6.9% largely confirms earlier indicators that were pointing to a bounce-back in business sentiment and stabilization in hiring demand.

U.S.

• Despite threats from the Trump administration to replace Jerome Powell as chair of the U.S. Federal Reserve, any replacement who is aligned with President Donald Trump’s call for lower rates doesn’t necessarily mean rate cuts will come to fruition. There are 12 voting members on the committee, thereby requiring a minimum of seven members to agree before the central bank can adjust policy rates.
• U.S. mortgage applications unexpectedly jumped to the highest level since early 2023 even though mortgage rates barely budged from the week prior.
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Further Afield

• Trade uncertainty continues, but recent developments suggest a more encouraging outlook. President Trump extended the deadline to negotiate a trade deal with the U.S. to August 1 from July 9, as widely expected. The EU’s Commissioner for Trade and Economic Security, Maros Sefcovic, expressed optimism with respect to the possibility of reaching a “satisfactory conclusion” to the negotiations soon and potentially before the Trump administration’s new deadline.
• The momentum of Chinese onshore equities has strengthened since late June. While pinpointing the exact reasons for improved investor sentiment is challenging, we believe wealth effects from year-to-date gains and China’s persistently low-rate environment are encouraging the deployment of capital into active equity opportunities.

Feel free to contact me with any questions and/or to discuss investment ideas.

Regards,

Shiuman

 

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