Morning Market Brief February 3, 2025

A peek at the labour market

We enter February after a busy and notable January. Talk of tariffs, global competition in the artificial intelligence space and central bank actions stole the headlines last month, creating a bit of volatility in financial markets. This week, the Canadian and US labour markets come into the spotlight. Here’s what to watch for this week.

• Statistics Canada (StatCan) will release Canada’s trade balance for December on Wednesday. Canada has run a trade deficit for nine straight months. Trade will be in the spotlight with the threat of tariffs looming. A Bloomberg survey of economists expects a trade surplus in December.
• Canada’s employment change and unemployment rate will be released on Friday. Canada’s economy added 90,900 jobs in December, the largest amount since January 2023. This helped lower Canada’s unemployment rate to 6.7%.
• This week, several labour market reports from the US will be released. Job openings and quits will be released on Tuesday, ADP employment change on Wednesday, and the unemployment rate on Friday.
• Looking around the world, European inflation will be released today, China’s services sector activity on Tuesday, the Bank of England’s interest-rate decision on Thursday and Germany’s industrial production on Friday.
• Key earnings in Canada include TMX Group, Suncor, BCE and Saputo. Notable earnings in the US include PepsiCo, AMD, Alphabet, Walt Disney, Uber, Ford and Amazon.

In addition to these important economic announcements, tariffs will garner much attention from markets. Tariffs have the potential to bring down trade activity, hindering global economic growth. The outlook for Canada’s economy is a bit uncertain in response to the impact of tariffs. However, economic growth ended 2024 on a relatively positive note, with StatsCan estimating annualized growth of 1.8% over the final quarter, up from the third quarter.

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