US stocks slump, continuing the tariff-driven selloff

Canadian stocks tumbled Tuesday after U.S. President Trump imposed 25% tariffs on goods from the neighboring country and a lower 10% tariff on oil products.

At the open, the benchmark S&P/TSX Composite was down 321 points, or 1.3%, and the S&P/TSX 60 index opened down 22 points, or 1.4%.

Prime Minister Justin Trudeau announced that Canada would respond with 25% tariffs on C$155 billion worth of U.S. goods starting Tuesday.

Canada will impose 25% tariffs on C$30 billion worth of U.S. goods starting Tuesday, with tariffs on the remaining C$125 billion in products set to take effect in 21 days.

"Our tariffs will remain in place until the U.S. trade action is withdrawn, and should U.S. tariffs not cease, we are in active and ongoing discussions with provinces and territories to pursue several non-tariff measures," Trudeau stated.

In addition to the Canada tariffs, Trump announced that 25% tariffs would go into effect Tuesday on Mexico, and an additional 10% tariff would be applied to China, bringing their rate to 20%.

U.S stocks fall again

U.S. stocks fell again at the open, extending Monday’s sharp sell-off. At the U.S open, the Dow Jones Industrial average was down 358 points, or 0.8%, the S&P 500 was down 44 points, or 0.8%, and the tech-heavy NASDAQ was down 181 points, or 0.9%.

Crude oil falls

Oil prices fell on Tuesday as traders weighed the growing risk of a global trade war alongside expectations of higher output from major producers next month.

By 9:30 ET, U.S. crude futures (WTI) dropped 0.9% to US$67.77 per barrel, while Brent Oil declined 1% to US$70.67 per barrel, nearing three-month lows.

On Monday, the Organization of the Petroleum Exporting Countries and its allies, known as OPEC+, confirmed plans to move forward with a scheduled April production increase of 138,000 barrels daily, marking the group’s first output hike since 2022.

Gold rises

Gold prices climbed on Tuesday as investor demand for the metal’s safe-haven appeal grew following the announcement of new tariffs by U.S. President Donald Trump.

By 09:30 ET, gold futures gained 1%, reaching US$2,978 per ounce, extending its rally for a second consecutive session.

So far this year, bullion has surged by approximately 10%, briefly hitting an all-time high of US$2,956.15 on February 24. However, analysts at UBS noted that gold lost some momentum toward the end of the month, partly due to profit-taking and well-anticipated supply challenges in the U.S. and UK.

Investing.com - Target (NYSE:TGT) unveiled a cautious outlook for sales growth in its current financial year as the big-box retailer flagged uncertainty surrounding President Donald Trump’s trade policy, weighing on shares in early U.S. dealmaking on Tuesday.

The Minnesota-based group said it now expects comparable sales growth to be "in a range around flat," compared with Bloomberg consensus projections for an uptick of 1.7%, flagging a "small decline" in net sales in February.

In light of last month’s sales dip and ongoing murkiness around the consumer spending environment, "combined with tariff uncertainty and the expected timing of certain costs within the fiscal year," Target said it now anticipates "meaningful" year-on-year profit pressures in the first quarter "relative to the remainer of the year."

“During February, we saw record performance around Valentines Day. However, our topline performance for the month was soft, as uncharacteristically cold weather across the U.S. affected apparel sales, and declining consumer confidence impacted our discretionary assortment overall,” said Chief Financial Officer Jim Lee in a statement.

Lee added that Target expects to see a "moderation" in this trend as apparel sales respond to warmer weather in the U.S. and shoppers spend more around upcoming holidays like Easter.

"We will continue to monitor these trends and will remain appropriately cautious with our expectations for the year ahead,” Lee said.

The comments come after rival Walmart (NYSE:WMT) issued downbeat annual sales and profit guidance last month, due to a need to carefully approach the ongoing trade landscape.

Meanwhile, economic data points have shown that sentiment among U.S. shoppers has slumped to a 15-month low, with households and businesses fretting over the implications of Trump’s tariffs on prices.

Figures last week found that consumer expenditures also fell for the first time in almost two years in January, while inflation expectations soared.

The numbers have hinted at a possible sluggishness -- or even contraction -- in the U.S. economy in the first quarter. The Atlanta Fed’s GDPNow model now sees annualized growth in the current quarter at -2.8%, reversing from +2.3% last week.

Still, Target delivered a 1.5% increase in comparable sales in the fourth quarter, topping estimates for an uptick of 1.18%, thanks in part to strength in its items like apparel, toys and sporting goods during the crucial holiday shopping season. The figure had fallen by 4.4% a year earlier.

Quarterly core profit before interest, taxes, depreciation and amortization also came in at $2.26 billion in the three months ended on February 1, higher than analysts’ forecasts of $2.14 billion.

"Target easily clears the ’could have been worse’ bar, [...] but there’s not a ton to get very excited about, particularly given the cautious near-term commentary," analysts at Vital Knowledge said in a note to clients.