Trump Rejects Trade Agreement as Canadian Stocks Volatize

Canadian markets experienced significant volatility between July 29 and July 30, 2026, driven by trade threats from the United States and geopolitical instability. On Wednesday, the S&P/TSX Composite Index fell 1.16% to 35,333.78 after Donald Trump stated he was not interested in revisiting the Canada-United States-Mexico Agreement, claiming the deal was not important for the U.S. Trump further threatened to tax Canada over wildfire smoke, accusing the country of willful negligence.

These statements coincided with the U.S. Federal Reserve's decision to hold interest rates steady at 3.50% to 3.75% and a resumption of U.S. military strikes against Iran. The uncertainty complicates ongoing trade negotiations led by Trade Minister Dominic LeBlanc, especially as additional 50% tariffs on many Canadian exports are scheduled to begin August 19.

Markets partially recovered on Thursday, with the S&P/TSX Composite Index rising 0.49% to 35,505.84. This gain was primarily fueled by a surge in gold prices, which boosted the gold-linked materials sector. This recovery occurred as U.S. forces concluded their series of strikes against Iran.