04:27 PM EST, 03/03/2025 (MT Newswires) -- The Toronto Stock Exchange closed down 1.5% on Monday as U.S. President Donald Trump confirmed he will go ahead with planned 25% tariffs on imports from Canada's and Mexico tomorrow, launching a trade war likely to damage the economies of all three countries.

The S&P/TSX Composite Index closed down 391.88 points to end at 25,001.57, the lowest since Jan.16. The biggest declining sectors were Technology and Energy, down 3.40% and 5.13% respectively.

Trump on Monday confirmed he will place the levies on imports from the two largest U.S. trading partners on Tuesday, as well as boosting import taxes on China, its third-largest trading partner, to 20% from 10%. He told reporters "There's no room left for a deal on tariffs on Mexico and Canada". Imports of Canadian energy will be taxed at a 10% rate. Canadian is the largest foreign source of U.S. oil imports, supplying about 20% of the country's daily consumption.

Melanie Joly, Canada's Minister of Foreign Affairs, said Canada will initially impose retaliatory tariffs on $30 billion of U.S. imports, a first tranche that will eventually rise to $155 billion of American products.

Trump's move comes as the U.S. economy is weakening, with the Atlanta Fed's GDPNow model forecasting a 2.8% drop in first-quarter U.S. gross domestic product, down from a predicted drop of 1.5% on Friday.

Of commodities, West Texas Intermediate crude oil fell to a three-month low after OPEC+ said it will go ahead with a plan to begin returning 2.2-million barrels per day of production cuts in 18 monthly tranches beginning next month. WTI crude for April delivery closed down US$1.39 to settle at US$68.37 per barrel, the lowest since Dec.9, while May Brent crude closed down US$1.19 to US$71.62.

But Gold was sharply higher late afternoon Monday as the dollar plunged ahead of the start of promised U.S. tariffs on imports from its two largest trading partner while safe-haven demand increased amid geopolitical concerns, including relations between the U.S. and Ukraine. Gold for April delivery was last seen up $52.90 to US$2,901.40 per ounce.