Canadian equities offer both some unique opportunities and some potential challenges in the year ahead. After a solid 2024 that saw the S&P/TSX Composite Index (TSX) notch an all-time high in the summer and then continue to power higher in the fourth quarter on the back of better-than-expected earnings, declining interest rates, and a weaker Canadian dollar, the focus has now shifted to how equities will handle another Donald Trump administration and what potential tariffs, related to Canada as well as other parts of the world, may mean for equities. On balance, we see a solid runway for Canadian stocks in 2025, supported by valuation upside and the potential for stronger global growth to propel cyclical sectors higher, leading to renewed interest in the Canadian market.
Let’s start with the macro backdrop in Canada. The landscape as it relates to growth, inflation, interest rates, and consumer spending has improved on…
