Canadian Stocks Tumble As Traders Concentrate On Budget

(RTTNews) - Canadian stocks slumped heavily on Tuesday as investor focus shifted to today's federal budget as expectations of another rate cut by the central bank slowly diminish.

After opening below yesterday's close, the benchmark S&P/TSX Composite Index traded firmly negative throughout the session before finally closing at 29,777.82, down by 497.24 points (or 1.64%).

Out of the 11 sectors, only consumer staples posted gains today.

Canada's Finance Minister François-Philippe Champagne is tabling budget 2025 today.

As the Canadian economy is starting to feel the pain of U.S. tariffs, the nation expects concrete steps that would bring the derailed economy back on track and hence this first budget of Prime Minister Mark Carney assumes significance.

Carney had earlier promised "generational investment" in his first budget though he also warned of tough times ahead.

Yesterday, data released by S&P Global revealed that Canada's Manufacturing PMI rose to 49.6 in October from 47.7 in September, indicating a somewhat slower contraction. It also revealed that both output and new orders fell at much weaker rates, with new orders slipping to their weakest pace in 2025.

On October 29, the Bank of Canada lowered its benchmark interest rate by a quarter percentage point to 2.25 per cent.

Yesterday, BoC Governor Tiff Macklem stated that the rate is now at the low end of the central bank's neutral range. However, he refrained from making any policy recommendation that he would like to see in the federal budget.

U.S. President Donald Trump has imposed 35% tariffs on Canadian exports to the U.S. These levies, which took effect since August 1, have already hammered steel, aluminum, automobile, lumber and copper industries in Canada.

After a White House visit in October, Carney stated that there was progress in trade talks between the two nations.

Last week, Trump unexpectedly announced that he was increasing tariffs on Canada by another 10% as he was displeased with an anti-tariff advertisement made by Ontario that was aired across the U.S. Now, the bilateral trade negotiations that have been going on for around three months are in a limbo.

The U.S. Supreme Court is hearing on petitions against Trump's tariffs on November 5 (tomorrow).

Though a verdict may take months to be delivered, investors in Canada are focusing on the hearing as the mutual arguments as well as comments made by the judges could throw more light on the sustainability of tariffs.

On the business front, the Toronto-based news and financial information company, Thomson Reuters Corp. (TRI) reported third-quarter earnings of $423 million with a net income of 94 cents per share.

Consumer Staples (0.11%) was the only major sector that gained in today's trading.

Among the individual stocks, Empire Company Ltd (1.33%), Loblaw CO (1.17%), George Weston Limited (1.14%), The North West Company Inc (0.44%), and Jamieson Wellness Inc (0.35%) were the prominent gainers.

Major sectors that lost in today's trading were Consumer Discretionary (1.04%), Real Estate (1.15%), Energy (1.17%), Healthcare (1.78%), Materials (3.56%), and IT (3.77%).

Among the individual stocks, Sylogist Ltd (7.14%), Bitfarms Ltd (6.74%), Shopify Inc (6.47%), New Gold Inc (8.99%), Aya Gold and Silver Inc (8.34%), and G Mining Ventures Corp (8.29%) were the notable losers.

International Petroleum Corp (3.70%), Waste Connections Inc (2.06%), and Fortis Inc (1.79%) were among the prime market-moving stocks today.