“8,800 Jobs”: Canadian Unemployment Nears Decade High, iShares S&P / TSX 60 Index ETF Stock (TSE:XIU) Posts Slight Gains

If there were any doubt that the trade war was taking a toll on Canada, one need look no farther than the latest unemployment data. The country posted 8,800 jobs in May, reports noted, and Canadian unemployment soared to a high the likes of which had not been seen in nearly a decade without a pandemic involved. Yet despite this dismal report, the iShares S&P / TSX 60 Index fund (TSE:XIU) actually managed to notch up fractionally in Friday morning’s trading.

The news was a disaster. The country added just 8,800 jobs in May, which was not even vaguely close to the 1.6 million jobless Canadians currently in the picture. That sent the total unemployment rate up to 7%,, up from 6.9% in April, and the third month-to-month increase in a row. The picture is even worse when compared against May 2024, in which Canadian unemployment was actually about 14% lower.

Leaving out numbers from 2020 and 2021, when COVID-19 was in full swing, Canada had not seen this level of unemployment prior to September 2016. About the only bright spot for the field is that there were no mass layoffs. That at least suggests the labor market itself is not in a bad state, just those who try to put it to work are.

The China Solution

With a trade war strangling Canada’s economy, it is therefore no surprise that Canada would look to make some new deals elsewhere. And right now, Canada is looking to the world’s second largest economy, China, to find that economic boost. Prime Minister Carney and Premier Li Qiang recently agreed to “…regularize channels of communication” between the two countries.

Both are apparently also planning to work together on “address(ing) the fentanyl crisis,” which was one of the biggest reasons that President Trump engaged in the trade war to begin with. This is doubly interesting, because as it turns out, China and Canada had a bit of a trade ware going on between themselves. China had tariffs on several Canadian agricultural products, and Canada had some on steel, aluminum, and Chinese-made electric vehicles.

Is the iShares S&P / TSX 60 Index ETF a Good Buy Right Now?

Turning to Wall Street, analysts have a Moderate Buy consensus rating on TSE:XIU shares based on 51 Buys, nine Holds and one Sell assigned in the past three months, as indicated by the graphic below. After a 19.34% rally in its share price over the past year, the average TSE:XIU price target of $43.39 per share implies 8.9% upside potential.

See more TSE:XIU analyst ratings

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