How will tariffs affect the stock market?

When US president Trump imposed a 25% tariff on Canadian imports to the US on March 4, 2025, the news sent financial markets into a spin. With China and Mexico also hit by tariffs, and China and Canada both quickly responding with retaliatory tariffs, a trade war is very real possibility.

But will tariffs affect the stock market? If so, how? In a time of market uncertainty, where do you look to find tariff-proof stocks? Keep reading to find out.

How will tariffs affect the stock market?

Trump’s tariffs could potentially have wide-reaching effects on the stock market and the Canadian economy as a whole. Here are some key features and factors to keep an eye out for how tariffs will affect the stock market in the weeks and months ahead.

Short-term market volatility

We’ve already seen the introduction of tariffs rattle North American stock markets. At the close of trading on March 4, 2025, the S&P/TSX composite index had fallen 429.57 points to 24,572 after a volatile day. The Dow Jones, S&P 500 and Nasdaq also fell the same day, while the S&P/TSX rebounded up 298.82 points the following day.

Analysts are predicting that investors can expect plenty more of this volatility in coming times. With uncertainty reigning over the impact tariffs will have on the Canadian and US economies and no certainty around what else the Trump administration might have in store, investors could be in for a rollercoaster ride.

Reduced GDP and possible rate cuts

If 25% tariffs remain in place for a sustained period, many analysts predict that the Canadian economy could be headed for a recession. According to analysis from Edward Jones, with US exports representing around one-fifth of Canada’s GDP, the tariffs could cause a 2.5%–3% decline in GDP. Unemployment and inflation levels are also expected to rise.

This has prompted analysts to suggest that a Bank of Canada interest rate cut could potentially be on the cards. Falling interest rates could potentially drive investors away from bonds and encourage investment in the stock market.

Long-term outlook

The key word for investors at the moment is uncertainty. Economists and other experts are uncertain about how long tariffs will be in place, and there’s also plenty of uncertainty around future changes to US and Canadian trade policy.

At the same time, it’s worth remembering that short-term volatility is common for stock markets. Rather than getting caught up in the drama of daily headlines and market fluctuations, it’s important to keep an eye on your long-term financial goals.

The US’s 2018-19 trade war with China during Trump’s first presidency affected markets in the short-term, but the S&P 500 still gradually rose over the long term right up until the Covid pandemic hit.

Tariff-resistant TSX stocks

Explore options for tariff-resistant TSX stocks here, and keep reading to learn more about each option below.

Company	Ticker	Stock price	YTD performance	Buy on Qtrade
Emera Inc.	EMA	C$68.32 The latest available market close price for Emera in CAD.	24.92%	Buy now
Fortis Inc.	FTS	C$72.50 The latest available market close price for Fortis in CAD.	38.93%	Buy now
TELUS Corporation	T.TO	C$18.82 The latest available market close price for Telus in CAD.	-24.78%	Buy now
Rogers Communications Inc.	RCI-B	C$49.78 The latest available market close price for Rogers Communications in CAD.	-15.75%	Buy now
Cogeco Communications Inc.	CCA	C$67.50 The latest available market close price for Cogeco Communications in CAD.	-31.63%	Buy now
Agnico Eagle Mines Limited	AEM	C$293.89 The latest available market close price for Agnico Eagle Mines in CAD.	217.54%	Buy now
GoGold Resources Inc.	GGD	C$3.76 The latest available market close price for GoGold Resources in CAD.	52.46%	Buy now
Stantec Inc.	STN	C$137.00 The latest available market close price for Stantec in CAD.	233.66%	Buy now
Fairfax Financial Holdings Limited	FFH	C$2,250.96 The latest available market close price for Fairfax Financial in CAD.	427.34%	Buy now

What are top resilient Canadian stocks amidst tariffs?

A solid strategy in the face of tariffs and market uncertainty is to target stocks that are less likely to be majorly impacted by tariffs. This includes industries that focus on essential services that are always in high demand and companies with a strong domestic focus that are less reliant on exports to the US.

Here are some sectors and stocks worth researching as the tariffs take effect.

Utilities

In the current financially uncertain times, Canadians still require essential infrastructure. Utilities stocks like electricity, gas and water are therefore worth investigating.

One company worth checking out is Emera Inc., which is an electricity and natural gas distributor in Atlantic Canada, the Caribbean and the US and offers a high dividend yield. Fortis is also one of the largest utility stocks and pays high dividends, so it’s worth a look if you’re searching for defensive stocks.

Emera (EMA.TO)

Emera Incorporated, an energy and services company, invests in generation, transmission, and distribution of electricity in the United States, Canada, Barbados, and the Bahamas. The company operates through Florida Electric Utility, Canadian Electric Utilities, Gas Utilities and Infrastructure, Other Electric Utilities, and Other segments.

Emera is headquartered in Canada and is traded on the Toronto Stock Exchange under the ticker symbol EMA. At the last market close, its share price was C$68.32 with a trading volume of 667,042.

YTD performance	24.92%
Market cap	C$20.6 billion
Revenue	C$8.5 billion
Earnings per Share (EPS)	C$3.65
Return on Equity (ROE)	9.07%
Price-to-Earnings Ratio (P/E)	18.71
Net Profit Margin	13.77%
Operating Margin	23.12%

Revenue, EPS, ROE, ROA, net profit margin and operating margin were calculated based on the trailing twelve months (TTM).

Emera stock chart (TO: EMA)

This chart tracks Emera stock price performance over time.

Fortis (FTS.TO)

Fortis Inc. operates as an electric and gas utility company in Canada, the United States, and the Caribbean countries.

Fortis is headquartered in Canada and is traded under the ticker symbol FTS. It currently has a market cap value of C$36.5 billion.

YTD performance	38.93%
Market cap	C$36.5 billion
Revenue	C$12.0 billion
Earnings per Share (EPS)	C$3.36
Return on Equity (ROE)	7.61%
Price-to-Earnings Ratio (P/E)	21.49
Net Profit Margin	14.70%
Operating Margin	30.29%

Revenue, EPS, ROE, ROA, net profit margin and operating margin were calculated based on the trailing twelve months (TTM).

Fortis stock chart (TO: FTS)

This chart tracks Fortis stock price performance over time.

Telecommunications

Telecom stocks have endured tough times in recent years, but they offer potential value for investors. After all, our demand for phone and internet services isn’t going to go away any time soon, and the largest telecoms typically focus on the domestic market, hopefully minimizing any impact from tariffs. They also offer high dividend yields. Investors may be hoping some of the big players can return to their price highs of recent years.

Telus, Rogers and Cogeco Communications are three options you might like to research further.

Telus (T.TO)

TELUS Corporation, together with its subsidiaries, provides a range of telecommunications and information technology products and services in Canada. It operates through Technology Solutions and Digitally-Led Customer Experiences segments.

Telus is headquartered in Canada and is traded on the Toronto Stock Exchange under the ticker symbol T. At the last market close, its share price was C$18.82 with a trading volume of 5,958,451.

YTD performance	-24.78%
Market cap	C$29.5 billion
Revenue	C$20.4 billion
Earnings per Share (EPS)	C$0.78
Return on Equity (ROE)	4.69%
Price-to-Earnings Ratio (P/E)	24.37
Net Profit Margin	5.77%
Operating Margin	15.97%

Revenue, EPS, ROE, ROA, net profit margin and operating margin were calculated based on the trailing twelve months (TTM).

Telus stock chart (TO: T)

This chart tracks Telus stock price performance over time.

Rogers Communications (RCI-B.TO)

Rogers Communications Inc. operates as a communications and media company in Canada.

Rogers Communications is headquartered in Canada and is traded on the Toronto Stock Exchange under the ticker symbol RCI-B. At the last market close, its share price was C$49.78 with a trading volume of 2,494,565.

YTD performance	-15.75%
Market cap	C$27.5 billion
Revenue	C$21.0 billion
Earnings per Share (EPS)	C$12.47
Return on Equity (ROE)	38.94%
Price-to-Earnings Ratio (P/E)	4.05
Net Profit Margin	32.11%
Operating Margin	24.05%

Revenue, EPS, ROE, ROA, net profit margin and operating margin were calculated based on the trailing twelve months (TTM).

Rogers Communications stock chart (TO: RCI-B)

This chart tracks Rogers Communications stock price performance over time.

Cogeco Communications (CCA.TO)

Cogeco Communications Inc. operates as a telecommunications corporation in Canada and the United States.

Cogeco Communications is headquartered in Canada and is traded on the Toronto Stock Exchange under the ticker symbol CCA. At the last market close, its share price was C$67.50 with a trading volume of 1,003,306.

YTD performance	-31.63%
Market cap	C$3.0 billion
Revenue	C$2.9 billion
Earnings per Share (EPS)	C$7.31
Return on Equity (ROE)	8.87%
Price-to-Earnings Ratio (P/E)	9.88
Net Profit Margin	10.79%
Operating Margin	25.70%

Revenue, EPS, ROE, ROA, net profit margin and operating margin were calculated based on the trailing twelve months (TTM).

Cogeco Communications stock chart (TO: CCA)

This chart tracks Cogeco Communications stock price performance over time.

Gold

Gold has long been seen as a defensive investment, providing protection against inflation and market downturns. But while buying and storing physical gold may not be a practical option for everyone, a different strategy is to invest in gold mining companies.

Though gold stocks tend to have higher volatility than physical gold—with higher risk but also the potential for higher reward—they provide a way to gain exposure to this precious metal.

One company you might like to consider is Agnico Eagle Mines Limited, a gold mining firm that recently featured in our list of the best Canadian stocks. Another one to research is GoGold Resources Inc., which mines gold, silver and copper mostly in Mexico.

Agnico Eagle Mines (AEM.TO)

Agnico Eagle Mines Limited, a gold mining company, engages in the exploration, development, and production of precious metals. It explores for gold, silver, zinc, and copper.

Agnico Eagle Mines is headquartered in Canada and is traded under the ticker symbol AEM. It currently has a market cap value of C$147.6 billion.

YTD performance	217.54%
Market cap	C$147.6 billion
Revenue	C$10.6 billion
Earnings per Share (EPS)	C$9.43
Return on Equity (ROE)	15.67%
Price-to-Earnings Ratio (P/E)	31.17
Net Profit Margin	32.63%
Operating Margin	53.10%

Revenue, EPS, ROE, ROA, net profit margin and operating margin were calculated based on the trailing twelve months (TTM).

Agnico Eagle Mines stock chart (TO: AEM)

This chart tracks Agnico Eagle Mines stock price performance over time.

GoGold Resources (GGD.TO)

GoGold Resources Inc. engages in the exploration, development, and production of silver, gold, and copper primarily in Mexico It owns the Los Ricos property, which includes Los Ricos South and Los Ricos North projects, that covers 45 concessions with an area of approximately 24,000 hectares situated in the Jalisco State, Mexico; and the Parral Tailings project located in the city of Parral.

GoGold Resources is headquartered in Canada and is traded under the ticker symbol GGD. It currently has a market cap value of C$1.7 billion.

YTD performance	52.46%
Market cap	C$1.7 billion
Revenue	C$72.5 million
Earnings per Share (EPS)	C$0.07
Return on Equity (ROE)	5.38%
Price-to-Earnings Ratio (P/E)	56.14
Net Profit Margin	23.90%
Operating Margin	29.14%

Revenue, EPS, ROE, ROA, net profit margin and operating margin were calculated based on the trailing twelve months (TTM).

GoGold Resources stock chart (TO: GGD)

This chart tracks GoGold Resources stock price performance over time.

Dividend stocks

It’s also worth checking out stocks that reliably pay high dividends. Dividends can provide an ongoing source of income even when the market is volatile, providing added security for investors. Check out our guide to the best dividend stocks for more information.

Related: Best Canadian stocks to buy right now

Fairfax Financial (FFH.TO)

Fairfax Financial Holdings Limited, through its subsidiaries, provides property and casualty insurance and reinsurance, and investment management services in the United States, Canada, the Middle East, Asia, and internationally. It operates through Property and Casualty Insurance and Reinsurance; Life insurance and Run-off; and Non-Insurance Companies segments.

Fairfax Financial is headquartered in Canada and is traded on the Toronto Stock Exchange under the ticker symbol FFH. At the last market close, its share price was C$2,250.96 with a trading volume of 70,285.

YTD performance	427.34%
Market cap	C$50.8 billion
Revenue	C$38.4 billion
Earnings per Share (EPS)	C$284.61
Return on Equity (ROE)	17.29%
Price-to-Earnings Ratio (P/E)	8.03
Net Profit Margin	12.19%
Operating Margin	18.16%

Revenue, EPS, ROE, ROA, net profit margin and operating margin were calculated based on the trailing twelve months (TTM).

Fairfax Financial stock chart (TO: FFH)

This chart tracks Fairfax Financial stock price performance over time.

Canadian energy stocks tariff impact

There was one exception to the 25% blanket tariff imposed on Canadian imports: Canadian energy products will be taxed at a lower rate of 10%.

This reduced tariff, combined with the reliance of the Midwestern US on Canadian energy, prompted RBC Capital Markets to picture a slightly better outlook for the energy sector than previously feared. “A lower 10% rate, and the fact that U.S. Midwest refineries may not have immediate substitutes for Canadian heavy crude oil gives a relative (not absolute) reprieve that would relieve some pressure on energy-producing provinces—mainly Alberta, Saskatchewan and Newfoundland and Labrador,” RBC’s analysis reads.

But a report from Syntax Data, quoted on BNN Bloomberg, examined the top 10 Canadian companies facing downside risks as a result of tariffs, four of which are in energy production. So, energy sector companies can expect to face new pressures in the times ahead.

A simple way to minimize your risk is to maintain a diversified portfolio by spreading your investments over a variety of sectors rather than focusing too heavily on one specific industry.

Will tariffs affect bank stocks?

Analysts expect bank stocks to suffer, but not as a direct result of the tariffs. Instead, the tariffs are expected to impact the overall Canadian economy by producing a major flow-on effect for banks.

When the economy is in poor shape, consumers are less likely to be able to repay their loans and less likely to want to apply for more credit.

That, of course, puts pressure on banks’ earnings. As Bank of Nova Scotia analyst Meny Grauman said in a note quoted in the Financial Post, the financial health of banks is “intimately tied to the health of the Canadian economy.”

“In that context, the current trade war that we find ourselves in has serious negative implications for Canadian bank stocks.”

How to invest in Canadian-based companies

If you want to invest in Canadian stocks, here’s what you need to do.

1. Choose a trading platform. Compare online stock brokers to find one that suits your needs. Look for low trading commissions, access to Canadian and global markets and a user-friendly trading platform and mobile app.
2. Create an account. It’s free to sign up for an account online with the broker of your choice. You’ll need to provide your personal information, contact details and proof of ID.
3. Make a deposit. Deposit funds into your trading account by bank transfer or Interac e-Transfer.
4. Choose stocks. Research different industries and individual companies before deciding which stocks you want to buy. Stock screeners are handy tools that can help you narrow down your options to suitable stocks.
5. Place a buy order. Choose the stock you wish to buy, enter the number of stocks you wish to purchase or the amount you want to spend, choose a market or limit order and then place your order.

Compare stock trading platforms

Related: Best stock trading apps in Canada

Bottom line

Trump’s tariffs mean economic uncertainty for Canadians and will likely drive market volatility, in the short-term at least. But there are still opportunities for savvy investors to find resilient Canadian stocks amidst tariffs, so research companies carefully and consider targeting stocks that offer essential services and provide high dividend yields to help ride out any turbulence.

FAQs about how tariffs affect the stock market

• What is the effect of a tariff on the market price?

  Tariffs result in higher market prices for consumers. A tariff is a tax on imported goods, and it's paid by the company that imports those goods into the country. This extra cost is passed on to consumers, in part or in full, in the form of increased prices.

• Do tariffs affect the stock market?

  Yes, tariffs impact the stock market in multiple ways. In the short term, they affect consumer confidence and lead to investor uncertainty, creating market volatility. They can also have wider-reaching effects on the strength of the economy, affect unemployment and even prompt interest rate changes, all of which can in turn affect share prices.

• How do I buy stocks in Canada?

  You can buy stocks through an online brokerage via its web platform, mobile app or desktop software. To buy stocks, you first need to provide your personal and contact details as well as proof of ID to open a brokerage account. You can then search for the stock you want to invest in and place a buy order. Check out our guide on how to buy stocks for more information.

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