Podcast
New Tariffs and Weak Jobs Numbers
Will Simpson and Greg Wise
August 1, 2025
Global markets take a hit as the scale of Trump’s tariffs sets in, compounded by weaker-than-expected U.S. jobs numbers.
As we close out the week and the month of July, markets have been anything but quiet, breaking a decent period of low volatility. After a strong start to the week, North American equities experienced a significant pullback today, driven by a highly anticipated U.S. jobs report. The S&P 500, which had been setting new all-time highs, ended the week down approximately 2.0%. Similarly, the TSX Composite Index faced headwinds, finishing the week with a similar loss. Globally, markets have been mixed, with European stocks down mostly on currency, and Asian markets displayed more caution amid ongoing trade negotiations.
The primary catalyst for this late-week volatility was today’s U.S. labour market data. The report showed a weaker-than-expected job gain and, more importantly, significant downward revisions to previous months’ figures. This has led to renewed speculation that a cooling labour market could pressure the Federal Reserve to cut interest rates as early as this fall. Compounding the uncertainty were corporate earnings, with tech giants like Amazon.com Inc. projecting weaker-than-expected operating income. This sent a ripple through the market, particularly impacting the technology sector, which has been a major driver of recent gains. One final contributor is trade uncertainty. Trump has been busy as usual, making trade deals with a handful of countries and threatening higher tariffs for Canada once again. Investors are turning cautious for the time being as the scope and scale of Trump’s tariffs begin to set in.
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