TSX soars on gains in basic materials stocks as U.S.-China trade tensions escalate

TORONTO – Canada’s main stock index finished more than 500 points higher on Tuesday, helped by strong gains in the basic materials sector, while U.S. stock markets posted mixed results.

Kathrin Forrest, equity investment director at Capital Group, said the TSX was playing catch-up with non-domestic markets after it was closed Monday for the Thanksgiving holiday.

“A key boost came yet again from materials where the metals and mining subindex, which includes gold, silver, other precious metals, copper and steel, was up over five per cent,” she said.

“Then if you take a step back, year-to-date the TSX materials index is up now over 80 per cent, and that continues to be a key driver behind lifting the TSX overall by around 23 per cent year-to-date.”

The S&P/TSX composite index was up 502.72 points at 30,353.61 on Tuesday.

In New York, where trading was open on Monday, the Dow Jones industrial average was up 202.88 points at 46,270.46. The S&P 500 index was down 10.41 points at 6,644.31, while the Nasdaq composite was down 172.91 points at 22,521.70.

The December gold contract was up US$30.40 at US$4,163.40 an ounce.

Trade tensions between the U.S. and China continued to be a focus for investors. Those tensions prompted big swings on U.S. markets.

The latest swing follows China’s commerce ministry banning dealings by Chinese companies with five subsidiaries of South Korean shipbuilder Hanwha Ocean, swiping at U.S. President Donald Trump’s efforts to rebuild the industry in America.

Technology stocks are particularly sensitive to trade issues involving China and were the biggest weights on the market. Big chipmakers and other companies rely on China for raw materials and manufacturing. China’s large consumer base is also important for sales growth. Chipmaker Nvidia slumped 4.4 per cent and Broadcom fell 3.5 per cent.

The ongoing trade war between the U.S. and the world has been an unpredictable weight on the market. The trade conflict between the U.S. and China is potentially the most economically consequential, owing to those nations’ positions as the two largest economies in the world.

“Overall, trade uncertainty is clearly back on investors’ minds and with that, equity volatility has edged up as well,” Forrest said.

“That, of course, can be a source of worry, but it can also result in mispricing of stocks and other assets and that in turn creates opportunities for longer-term investors.”

Investors also digested comments from U.S. Federal Reserve chair Jerome Powell.

A sharp slowdown in hiring poses a growing risk to the U.S. economy, Powell said Tuesday, a sign that the Fed will likely cut its key interest rate twice more this year.

Forrest said the market is expecting the Fed to lower its key interest rate by a quarter-percentage point at its Oct. 29 meeting.

The Canadian dollar traded for 71.19 cents US compared with 71.43 cents US on Friday.

The November crude oil contract was down 79 cents US at US$58.70 per barrel.

This report by The Canadian Press was first published Oct. 14, 2025.

— with files from The Associated Press.

Companies in this story: (TSX:GSPTSE, TSX:CADUSD)