Investment update

Weekly insight into the marketplace.

May 5 to May 9, 2025

Stock markets swayed with trade-deal news

A cautious start to the week saw all the major North American stock indexes lose ground on Monday. Crude oil prices hit a four-year low, which weighed on Canada’s resource-heavy TSX. On Wall Street, Berkshire Hathaway shares fell 5%, following Warren Buffett’s announcement that he was stepping down after 60 years as CEO. For U.S. stock markets, sluggish performance carried over into Tuesday, with the broad-based Dow suffering the most with a 0.95% loss. The tech-heavy S&P 500 and Nasdaq lost 0.77% and 0.87%, respectively, as investors turned away from mega-cap stocks, such as Tesla and Meta Platforms. The TSX closed with a modest gain, buoyed by rebounding oil prices and a positive first face-to-face meeting between Canadian Prime Minister Mark Carney and U.S. President Donald Trump. On Wednesday, stock markets closed higher despite choppy trading after the U.S. Federal Reserve (the Fed) held interest rates steady in the face of tariff-related uncertainty. The Dow led the U.S. benchmarks with a 0.70% gain, supported by an 11% surge in shares of Disney after the entertainment behemoth reported better-than-expected financial results and a surprise increase in streaming subscriptions. The TSX closed 0.75% higher with help coming from shares of gold-mining giant Barrick, which rose 1.2% after the company beat estimates with its first-quarter profit. Thursday’s news of a trade deal between the U.S. and the United Kingdom, and positive comments from President Trump about upcoming weekend negotiations with China, added to Wednesday’s momentum. The S&P 500 rose 0.6% to notch its eleventh gain in the last 13 days, the Dow gained 0.6% and the Nasdaq advanced 1.1%. Shares of Canadian Natural Resources surged 5.2%, helping the TSX close 0.37% higher. On Friday, U.S. stock markets traded within a tight range and closed the week with slight losses. The TSX added to its weekly gain, with energy and resources stocks continuing to drive positive performance.

Carney and Trump met at the White House

Prime Minister Carney visited the White House on Tuesday for his first in-person meeting with President Trump. The main objective for Carney was to defuse rising tensions in Canada-U.S. relations. U.S. tariff policies that threaten the Canadian economy, along with public taunts from President Trump referring to Canada as the 51st state, have severely impacted diplomatic relations between the nations. Speaking to media at the Canadian Embassy after the meeting, Carney said he felt good about what had been achieved during the day, even though an agreement to remove U.S. tariffs from Canadian goods was not secured. What Carney did get was a commitment from Trump to negotiate a new Canada-U.S. trade deal. “It was a very constructive meeting. We have a lot more work to do. I’m not trying to suggest we can have one meeting and everything’s changed, but now we are engaged — very fully engaged,” Carney said. “I feel better about the relations.” Trump didn’t back away from his prior musings on annexing Canada, but he did acknowledge, “It takes two to tango,” and reacted positively to Carney: “I think this is a big step up. It’s a good step up for Canada.”

The Fed held rates steady

On Wednesday, the Fed held its benchmark interest rate at 4.25% to 4.5% for the third consecutive meeting. This decision reflects the central bank’s cautious stance as it navigates a complex economic landscape marked by heightened uncertainties, particularly those stemming from the Trump administration’s trade policies. The official statement noted that policy-makers judged that “the risks of higher unemployment and higher inflation have risen.” Fed Chair Jerome Powell explained further: “We are entering a new phase where the administration is beginning talks with a number of our important trading partners and that has the potential to change the picture materially or not.” President Trump, who in recent weeks has been outspoken in his criticism of Powell for not lowering interest rates fast enough, took to social media to express his disappointment: “‘Too Late’ Jerome Powell is a FOOL, who doesn’t have a clue. Other than that, I like him very much! Oil and Energy way down, almost all costs (groceries and “eggs”) down, virtually NO INFLATION, Tariff Money Pouring Into the U.S. — THE EXACT OPPOSITE OF ‘TOO LATE!’ ENJOY!”