04:13 PM EDT, 03/10/2025 (MT Newswires) -- The Toronto Stock Exchange started the new week down 378 points Monday on continuing concerns around the cost of a brewing trade war between Canada and the United States, and talk that it could lead to a recession in both nations, even as some market watchers remain bullish on Canadian equities.

Brian Belski over at BMO Capital Markets still believes Canadian equities will hit new all-time highs by year end and is maintaining a 28,500 year-end price target, while Rosenberg Research maintains its bias towards Canadian equities in North America.

At the end of Monday's session the TSX was down 1.5% at 24,380.71. Among sectors, Information Technology and Base Metals were the biggest decliners, down 3.62% and 4.03%, respectively. There were gainers, with Telecom up 1% and Utilities up 0.355%.

The Associated Press noted before the closing bells that the U.S. stock market was "flirting with" its worst day in years "as Wall Street questions how much pain President Donald Trump will let the economy endure through tariffs and other policies in order to get what he wants." The S&P 500 was down 2.7%, and the Nasdaq composite was 4% lower. The Dow Jones Industrial Average was down 956 points inside the last hour.

AP noted the main measure of the U.S. stock market is on track for a seventh swing of more than 1%, up or down, in the last eight days.

Here, the TSX hasn't escaped the volatility. Brian Belski at BMO Capital Markets in his latest 'Canadian Strategy Snapshot' noted winter "appears to be omnipresent for Canadian equities thanks to a full-blown blizzard of uncertainty with respect to tariffs and domestic politics."

Still, Belski believes the uncertainty is overblown. "For our part," Belski said, "we have traditionally treated and discerned "uncertainty" within our investment strategy process as exactly what it is -- namely, ambiguous, vague and insecure. As such, we are confounded (once again) with the plethora of macro forecasts that have been released the past several days that contain vigorous and decisive directness within what we believe is a blizzard of ambiguity and opacity.

"Furthermore, we believe conclusions cannot and should not be made before the final variables are known. To use another analogy, you need to run the race before you know your final time. Uncertainty scares investors and reactionary analysis only magnifies the noise in our view. To be clear, tariff actualities and political consternation is all about duration risk. Fear of the unknown causes strife and Canada is chalk full of strife right now, unfortunately. NO ONE KNOWS. Humility is the better tactic, from

our lens.

"So let's deal with what we know. We see NO material change in forward fundamentals in terms our Canadian models. As such we are not changing our 2025 $1600 EPS target for the TSX. YES, we continue to believe Canadian equities will hit new all-time highs by year end and are maintaining our 28,500 year-end price target."

Belski added: "However, we are NOT being flippant. Fear is a powerful emotion and uncertainty is the ice that is freezing Canadian investors. However, there are always opportunities, after all Canada has some of the best companies with the best products and services in the world. As such, we believe investors should be looking for opportunities over the next several months for companies that are being unfairly punished. We have created a screen of S&P/TSX companies that have seen valuation compression so far this year, despite having positive FY2 EPS growth expectations and have seen positive revisions to both FY1 and FY2 EPS."

BMO's Canadian Opportunities Screen includes the following companies: Aritzia ( ATZAF ) , Celestica ( CLS ) , Canadian Imperial Bank (CM.TO), Enbridge ( ENB ) , FirstService ( FSV ) , Gildan Activewear ( GIL ) , IA Financial ( IAFNF ) , Kinaxis ( KXSCF ) , Meg Energy (MEG.TO), Manulife Financial (MFC.TO), Nutrien ( NTR ) , Royal Bank (RY.TO), Shopify ( SHOP ) , Stantec ( STN ) , TC Energy ( TRP ) and WSP Global ( WSPOF ) .

Meanwhile, Rosenberg Research, in maintaining its bias towards Canadian equities in North America, noted model scores improved for the fourth month in a row to 49.9 from 49.4. This marks the highest score since June, back when Strategizer first became more constructive on Canadian stocks (TSX +30% since). The research noted 'on and off' tariffs and exemptions have weighed on sentiment, and prices have fallen 5% from the peak, while valuations are back to neutral territory as a result (60th percentile from 75th), "no longer posing any headwinds, at a time when earnings momentum remains positive (2025 estimates flirting near 6-month highs; U.S. comparable down near 1-year lows)."

The research said tariff related policy uncertainty is reflected by a lack of clarity in model sector rankings, and a bunching up in those tied for #4 (Technology, Real Estate, Industrials, and Energy). Beyond that, Health Care (#1), Financials (#2), and Materials (#3) remain from the month prior.

"One thing both the U.S. and Canada have in common is a very weak outlook for the Consumer Discretionary sector," it added.

Of commodities today, West Texas Intermediate crude oil closed at the lowest in six month on Monday as China's economy weakened in February and U.S. President Donald Trump's tariff threats continue to roil markets. WTI crude oil for April delivery closed down $1.01 to settle at US$66.03 per barrel, the lowest since Sept.10, while May Brent crude was last seen down $1.09 to US$69.27.

Also, gold prices were lower mid-afternoon on Monday as the dollar strengthened. Gold for April delivery was last seen down US$15.50 to US$2,898.60 per ounce.