12:24 PM EDT, 03/28/2025 (MT Newswires) -- The Toronto Stock Exchange is down near 306 points at midday with most sectors lower. Utilities, up 0.3%, is the sole gainer. Miners and info tech, down 2.7% and 2.3% respectively, are the biggest decliners.

U.S. President Donald Trump on social media confirmed he had spoken With Canada Prime Minister Mark Carney this morning, writing, "It was an extremely productive call, we agree on many things, and will be meeting immediately after Canada's upcoming election to work on elements of politics, business and all other factors that will end up being great for both the United States and Canada. Thank you for your attention to this matter!"

Prime Minister Carney has yet to comment.

Canadian GDP data was also released earlier today. CIBC noted Canadian GDP unexpectedly rose 0.4% in January, with that gain following an upwardly revised 0.3% increase in the prior month. However, the surge in activity during late 2024 and into 2025 was partly driven by temporary factors, including the front running of tariffs and the GST holiday, and advance data for February suggests that the economy had already stalled again even before U.S. tariffs came into effect.

"The Canadian economy was clearly in pretty good health heading into the start of this year," CIBC said, "but US tariffs on key areas such as steel, aluminum and autos (with the threat of more to be announced next week) have dramatically changed the forward-looking view. We suspect that the negative impact of tariffs will bring a contraction in the economy in Q2, but the BoC will also be focussed on inflation and inflation expectations in determining if/when it can support the economy by lowering interest rates further."

For RBC, the bottom line is the 0.4% jump in January GDP confirmed the economy started 2025 on a firmer footing, and leaves first-quarter GDP growth tracking close to double its own forecast for a 1.1% annualized growth rate. The monthly increase was the largest gain since April 2024, and with population growth slowing, it was the first time per-capita output (per population 15+) has increased in two straight months in 2.5 years.

However, "international trade risks continue to cloud the outlook with the details behind another round of expected tariff announcements next week having the potential to significantly impact the Canadian economic growth outlook," RBC added.

Meanwhile, Rosenberg Research said that given we are on the verge of a global trade war, it is legitimate to question the importance of the current day data releases. But, it added, the data that came out today were "very mixed" for the markets. Core PCE deflator came in "rather hot", at +0.4% month over month in February which was above the consensus estimate of +0.3% . Rosenberg Research said the year over year trend "hooked up a bit" to +2.8% from +2.7%, so it is obviously heading in the opposite direction from what the Fed would like to see. Not to mention the +3.1% rate over the past six months and the +3.6% annualized pace on a three-month basis. "Just wait until the tariff effect really kicks in hard in the next two or three months, once the current dealer auto inventory gets worked off," the research added.