12:18 PM EDT, 05/29/2025 (MT Newswires) -- The Toronto Stock Exchange is down over 47 points at midday with most sectors lower.

The financials sector, down 0.6%, is the biggest decliner. RBC early Thursday reported a lower-than-expected adjusted earnings and revenue for the second quarter, but increased its dividend. Its shares, down 3.2% to $172.94, is the most actively traded.

CIBC, which also reported its second-quarter results this morning, is down 0.5%.

BMO Economics in its morning note, said U.S. equity futures were pointing to large opening gains after Nvidia reported strong results and the U.S. Court of International Trade struck down the U.S. President's reciprocal and 10% baseline duties and the fentanyl-related levies on Canada, Mexico and China that were authorized under the International Emergency Economic Powers Act of 1977. BMO said: "The ruling effectively blocks most of the tariffs, though it does not apply to the duties on motor vehicles, steel and aluminum that were authorized by a different trade act, nor will it apply to planned levies on other products such as lumber, pharmaceuticals and microchips. The ruling sets the stage for appeals that could ultimately be decided in the Supreme Court. If upheld, the administration would need to seek authorization for these tariffs under other trade acts, such as Section 301 of the Trade Act of 1974 (unfair foreign trade practices), to impose sector-specific or broader country-specific tariffs. So, while the ruling could greatly limit the White House's ability to wage a trade war, uncertainty about future trade policies will remain high."

Canadian Prime Minister Mark Carney welcomed the U.S. federal trade court ruling deeming hefty tariffs linked to fentanyl trafficking as unlawful, but warned that other unjustified levies on Canadian imports remain in place, The Wall Street Journal reported.

On the home front, Rosenberg Research said today's industry jobs data for Canada showed a big drop, mainly in the services sector, which should be a clear recession indicator for the Bank of Canada.

Veteran market watcher, David Rosenberg, said the data were a "complete dud" in sliding -54.1k after the -40.2k slump in February (from the Survey of Employment, Payrolls, and Hours). Rosenberg noted that the companion Labour Force Survey for April showed "virtually no rebound at all".

"There can really be little doubt that the Canadian economy has entered a recession, and the Bank of Canada would be well advised to move out of the dugout and onto the baseball field. Interestingly, and rather disturbingly, you can't even pin the trade battle on this horrible report because the manufacturing sector only posted a modest decline (-1.8k) -- the vast majority of the employment loss was in the services sector (-59.5k). This came on the heels of a -32.7k contraction in February to mark the largest back-to-back declines since the spring of 2020."

"One thing is for sure," Rosenberg added, "there was no inflation coming out of this report". He noted average hourly earnings for salaried workers were "as flat as a beavertail", and that followed a -1.6% MoM February turndown. Hourly employees actually saw a -0.2% MoM wage pullback on top of a stagnant February. "The investment implications are clear: go short the Canadian dollar and go long the front end of the BoC bond curve."