Jobs Are Up. Stocks Are Down. Inflation Is Next.
TSX Slips, Aritzia Rips, and Canada’s Economic Signals Get Messy
Last week was a perfect example of how markets and the real economy can move in opposite directions.
Here’s what happened, and what to watch next:
1. TSX Rises High, Then Drops Hard
The TSX Composite hit a fresh all-time high early in the week, breaking above 30,000… but by Friday, it fell sharply, closing at 29,850, down 2% on the week.
That’s the worst weekly drop since April.
So what triggered the pullback?
2. U.S.–China Tensions = Investor Jitters
Trade tensions between the U.S. and China flared up again… with concerns about new tariffs and global supply chain risk.
When global headlines start looking shaky, investors tend to sell riskier stocks (especially tech and energy).
Shopify dropped 8%
Energy stocks also pulled back as oil prices slipped
This type of market behaviour is called “profit-taking”, when investors cash in on recent gains before things get rocky.
3. Jobs Data: Good News, Complicated Outcome
Canada added over 60,000 jobs in September, more than expected.
At first glance, that’s great. It eases recession worries and shows that the economy is still creating opportunities.
But here’s the catch: Stronger job numbers can delay interest rate cuts.
When the job market is strong, the Bank of Canada doesn’t feel as much pressure to lower rates, and higher rates mean more expensive borrowing for both businesses and individuals.
So while the labour market looks solid, it also means rate cut hopes get pushed further into the future.
4. Aritzia: A Bright Spot in Retail
In the middle of the mess, one Canadian brand stood out:
Aritzia jumped 8% on Friday after reporting strong earnings and beating expectations.
It’s a positive sign that some sectors (especially high-end retail), are still seeing demand, even in a higher interest rate environment.
✅ In short:
Markets are still holding up, but the foundation is looking shaky:
PMI (business activity data) is weakening
Trade tensions are rising
Jobs data is strong… but that delays rate relief
The Canadian dollar dipped to 71.33 cents USD
Investors are trying to stay optimistic…
But the Bank of Canada’s next move just got a lot more complicated.
The Consumer Price Index (CPI) on October 21 will be the next major economic signal. If inflation keeps cooling, the case for interest rate cuts will grow stronger.
Markets move fast, but smart, steady investors move smarter. Stay tuned for more tools to help you build wealth in Canada.
Your Finance Coach, Finance Femster
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