Canada Market Update – February 2025

Market News |

Welcome to our monthly economic and market update! As we enter a new month, here’s a recap of the key economic and market developments in Canada from February. Let’s get started.

Canada economy update

  • Canada’s budget deficit for the first nine months of the 2024/25 fiscal year fell to C$21.72 billion ($15.05 billion), down from C$23.61 billion a year earlier, as revenue growth outpaced spending. Government revenues rose 11.8%, driven by higher tax collections, while program expenses increased 10.7% across all major categories. Public debt charges surged 17.3% due to higher interest rates.
  • Toronto home sales rebounded 10% in January as new listings increased, though prices remained stable after two months of gains, according to TRREB data. Seasonally adjusted sales reached 5,971 units, recovering from an 18.2% drop in December but still 10.7% lower than January 2024. 
  • Canada’s economy added 76,000 jobs in January, bringing the unemployment rate down to 6.6%, according to Statistics Canada. The strong job growth exceeded expectations and aligns with the Bank of Canada’s optimistic outlook. Andrew Kelvin of TD Securities noted that while a March rate cut is still likely, continued strong employment data could boost confidence that the economy has achieved a soft landing.
  • Canada’s annual inflation edged up to 1.9% in January, driven by rising gasoline and natural gas prices, despite a sales tax reprieve lowering broader costs. Core inflation measures also increased, marking the sixth consecutive month where inflation remained at or below the Bank of Canada’s 2% target midpoint. As a result, market bets for a March interest rate cut dropped to 37% from 44% before the data release.

Canada stock market update

February brought slight declines for Canadian markets. The S&P/TSX Composite Index edged down by 0.55%, closing at CAD$ 25,392.37, while the S&P/TSX Venture Composite Index dropped 1.57% to CAD$ 613.95. A month of minor setbacks as market conditions remained uncertain.

  • The Canadian Securities Exchange (CSE) reported strong trading activity in January 2025, with a total trading volume of 1.5 billion shares and a trading value of $519 million. The exchange saw 104 financings completed, raising $118 million in total, and welcomed two new listings, bringing the total to 772 securities.
  • Ritchie Bros. Auctioneers generated over $250 million in gross transaction value (GTV) at its 2025 Premier Global Auction in Orlando, FL, held from February 17-21. The five-day event featured over 16,000 equipment items, trucks, and vehicles, attracting more than 19,000 bidders from 75+ countries.
  • Stantec Inc reported Q4 earnings of $0.79 per share, surpassing the Zacks Consensus Estimate of $0.69 per share and marking a 14.49% earnings surprise. This compares to $0.60 per share in the same quarter last year. The company also exceeded expectations in the previous quarter, delivering an earnings surprise of 5.56%.
  • WSP Global Inc. reported Q4 earnings of $166.9 million, up from $130.6 million a year ago, with revenue rising to $4.7 billion from $3.7 billion. Basic net earnings per share increased to $1.28 from $1.05, while the company’s backlog grew to $15.6 billion. For the full year, earnings reached $681.4 million on $16.2 billion in revenue.

Canadian top gainer and top loser stocks for February

Summary

Overall, Canada’s budget deficit narrowed to C$21.72 billion in the first nine months of the 2024/25 fiscal year as revenue growth outpaced spending. Toronto home sales rebounded 10% in January, while the economy added 76,000 jobs, lowering the unemployment rate to 6.6%. Inflation edged up to 1.9%, reducing expectations of a March rate cut. The stock market saw minor declines, with the S&P/TSX Composite Index down 0.55%. Ritchie Bros. reported $250 million in GTV at its Orlando auction, while Stantec and WSP Global exceeded earnings expectations.

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