• The latest:

  Just three days before the previous July 9 tariff pause deadline, the Trump administration changed course, pushing the window back to August 1. “They go into effect on Aug. 1.,” Commerce Secretary Howard Lutnick said.  “Tariffs go into effect Aug. 1, but the president is setting the rates and the deals right now.”

• Is this deadline firm?

  For some key trading partners, administration officials have signalled there may be some flexibility, according to reporting from Politico. 

• What's different from Tariffs Round 1:

  It’s happening alongside a separate threat of "national security tariffs" on key industries like lumber and copper, further complicating already tense and layered negotiations.

• The stakes:

  April’s initial tariffs caused a market downturn that erased as much as $5 trillion in value from the S&P 500, and this time, the market's reaction will hinge on whether the end of the pause leads to new trade deals or a return of dense ambiguity.

• The Canada angle:

  Canada faces existing tariffs of 25% on many exports and 50% on steel and aluminum. Key Canadian sectors like auto parts, energy, and agriculture are highly exposed to U.S. trade actions.

• Your plan:

  Analyze your portfolio’s exposure and speak to your advisor (if you have one), prepare with a targeted watchlist, and understand the tools available to help mitigate the risk of your portfolio’s value dropping.

For almost 90 days now, there’s been a pause on the Trump administration’s global tariffs and, for almost 90 days now, the market has been on a steady ascent.

At the end of June, the halfway mark of 2025, the S&P 500 eclipsed its all-time high. It’s been a stunning reversal from the April “Liberation Day” tariffs slide, which erased as much as $5 trillion in value from the S&P 500 and sent global investors scurrying for non-American options.

That optimism was fueled by the belief that the original July 9 deadline—since extended to August 1—would expedite the forging of new trade deals. 

“President Trump’s going to be sending letters to some of our trading partners, saying that, if you don’t move things along, then, on August 1, you will boomerang back to your April 2 tariff level,” Scott Bessent, the U.S. Treasury Secretary, said on CNN’s State of the Union. “So I think we’re going to see a lot of deals very quickly.”

But with mixed progress on that front, the clock is ticking louder, and the market is bracing for what comes next. Amid the noise, there is an opportunity: a window to plan, to prepare, and to act on strategy—not emotion.

To understand the current situation well enough to prep, it’s essential to know that negotiations are proceeding on two separate tracks.

1. The reciprocal tariffs (August 1 deadline)
   On April 8, President Donald Trump announced "reciprocal tariffs," including rates of 24% on Japanese imports and 20% on products from the European Union, causing markets to tumble. Originally, these tariffs were set to resume on July 9, but the date was pushed back to August 1 to allow for more negotiating time.
2. The “National Security” tariffs (an ongoing concern)
   Separately, the administration is pursuing tariffs on industries it deems essential to “national security,” such as lumber, copper, pharmaceuticals, and semiconductors. These could be implemented at any time, regardless of other trade deals.

The complexity, and whiplash volatility, of this situation is the core source of the market’s anxiety. 

In short: tariffs are, probably, making a comeback unless an extraordinary wave of trade deals interrupts them. Or, as has been known to happen now and then with this administration, a last-minute social media post rearranges the landscape.

As the deadline approaches, the situation could unfold in several ways. 

While President Trump has signaled he is not planning an extension, administration officials have also indicated the deadline might be pushed back. 

For investors, the likely scenarios to brace (and prep) for are:

1. Best case: Summer 2025 is the summer of deals

   In this scenario, the extended August 1 deadline acts as a catalyst, pushing the U.S. and its trading partners to finalize agreements. Which is strictly possible—we’ve already seen frameworks for deals struck with the U.K. and Vietnam.

   If the U.S. and its partners successfully broker similar deals—especially with major partners like Canada, the European Union, Japan, and India— it would remove a massive cloud of uncertainty from the market.

   • Investor impact: This would be a significant positive for the market. A broad wave of new trade deals could spark a relief rally, especially in the sectors that have been most under pressure, such as autos, manufacturing, and steel.
2. Middle ground: The deadline is delayed (again)

   As the cut off shifting from July 9 further cemented, the Trump administration’s adherence to things like deadlines is, often, optional. Administration officials have signalled they are confident deals will come together but, if talks fall apart, few would find it shocking to see the deadline change again. 

   This would continue to push back the shock of new tariffs but would not resolve the underlying issues. Negotiations would continue, and as one JPMorgan analyst noted, "volatility may continue until a final decision is reached this summer."

   • Investor impact: This scenario would prevent the worst-case market drop but would keep investors in a "wait and see" mode. The market would likely remain choppy, reacting to every piece of news and rumour coming out of the ongoing negotiations.
3. Worst case: The tariff war reignites

   If few, or no deals, are reached by August 1, the broad "reciprocal tariffs" announced in April would kick in. 

   The E.U. has already threatened to respond with at least $100 billion in retaliatory tariffs on standby. This would be compounded by the separate threat of "national security" tariffs on key industries, creating a multi-front trade conflict.

   • Investor impact: This degree of unpredictable change would be reminiscent to the one we saw in April, which erased as much as $5 trillion in value from the S&P 500. Companies in exposed sectors would see their costs rise and profits fall, and retaliatory tariffs would create a negative feedback loop for the global economy.

If anything other than the best-case scenario comes to pass, it’ll pay to understand what sectors have been hardest hit by tariffs before, and which ones are vulnerable now. Especially as different sectors are exposed for different reasons.

• Sectors sensitive to reciprocal tariffs. 

  These are industries with deep global ties. The Automotive and Steel sectors in Japan, South Korea, and Europe are a primary concern.

  These industries rely on complex international supply chains where raw materials and parts cross borders multiple times, making them highly vulnerable to tariffs that increase costs at multiple steps of production.

• Sectors targeted by national security tariffs

  This group is more targeted, with the list being populated by industries that the U.S. wants to build up its domestic production capacity in. These include:

  Pharmaceuticals: This is a major threat for both the European Union and India, as life-saving drugs are their No. 1 and largest export to the U.S., respectively. 

  Trade barriers on pharmaceuticals can raise costs or cause shortages, as many active ingredients are imported from countries like China and India.

  Semiconductors & electronics: Countries like Vietnam, Japan, Malaysia, and South Korea could be hit hard by tariffs on these products.

  This sector's reliance on imported semiconductors means tariffs make it more complicated to get hardware and raw materials essential to the tech industry, increasing costs for components like semiconductors and batteries.

  Lumber & timber: These potential tariffs could impact countries like Vietnam and Malaysia, and would be massively impactful to Canada.

• Sectors with more resilience to tariffs

  Just as some sectors are on the front lines of a trade dispute, others are naturally more insulated. These industries are often considered "defensive" because their business models are less dependent on the global trade flows that tariffs disrupt. 

  Utilities: A utility company's business is inherently local. While they aren't completely immune—tariffs can raise the cost of imported components like steel for new infrastructure—their core revenue is shielded from the direct impact of tariffs.

  Telecommunications: Similar to utilities, major Canadian telecom providers primarily serve a domestic customer base. This domestic focus makes them one of the most insulated sectors from direct tariff conflicts.

  Consumer staples: This sector includes companies that produce essential goods that people need regardless of the economic climate—food, beverages, and household products. While demand will remain high, these companies aren’t immune. Tariffs can still raise import costs, create potential supply chain disruptions, and ultimately, higher prices for consumers.

The tariff threat stretches beyond lumber and timber. The U.S. is Canada's top trading partner, and our economies are deeply intertwined.

• What tariffs are Canadian industries facing?

  The latest rate is 25% for most Canadian exports, but it gets worse. There’s a steep 50% tariff on Canadian steel and aluminum, too, which is an even bigger deal than the size of those numbers suggests. 

  Canada is the largest foreign supplier of steel and aluminum to the U.S., making these tariffs particularly painful. 

• The state of trade negotiations

  It is, in a word, delicate. To keep negotiations on track, recently elected Prime Minister Mark Carney and his government recently scrapped a planned 3% digital services tax on large U.S. tech companies after President Trump called it a “blatant attack.”

  Both countries spun the choice as a win, but if it definitely underscores one thing, it’s that the measures necessary to reach the other side of this tariff saga will be significant.

  To help shore up its position and diversify its export markets, Canada also sent its first natural gas shipment from a major Canadian plant to Asia. 

  “Canada has what the world needs,” Prime Minister Carney said the day the tanker set off at the end of June. “By turning aspiration into action, Canada can become the world’s leading energy superpower.”

• Steel and aluminum: These industries are already facing 50% tariffs, which has been called "hugely disruptive" and has effectively closed the U.S. market for many producers.
• Automotive: The North American auto industry is highly integrated, with parts and vehicles crossing the border multiple times during assembly. A 25% tariff on autos remains a significant threat.
• Energy and agriculture: Canada is a massive energy supplier to the U.S., and tariffs could have major implications for the industry. Beyond that, the U.S. has also signaled it wants concessions on Canada's protected dairy market.
  

Here is a strategic framework to help you move forward, no matter which direction the tariff headwinds blow.

1. Analyze: Read the signals

   For most long-term investors, the core “buy and hold” strategy remains sound. But “buy and hold” shouldn't mean “buy and ignore.” Use this as a moment of reflection and analysis, not tuning out.

   • Review your portfolio: Take a clear-eyed look at your holdings. How much exposure do you have to the key sectors mentioned above, both in Canada and abroad? Knowing your specific exposure is the first step.
   • Consult your expert: If you invest with a portfolio manager, now is an ideal time to check in. Ask how your managed portfolio is positioned to navigate potential volatility and use it as a chance to reaffirm your long-term financial plan.
   • Use the market’s “anxiety meter”: Keep an eye on the CBOE Volatility Index (the VIX). A rising VIX indicates increasing market anxiety and the expectation of bigger price swings. For an investor, this can be a signal to be more cautious, double-check your plan, or even look for assets that may have been oversold in a panic.
2. Prepare: Get your tools ready

   With your analysis in hand, the next step is equipping yourself with the right tools. If you invest with Questrade, good news: you have free access to them right in your trading platform.

   • Build your anti-tariff watchlist: It sounds small, but so is remembering to tie your shoes before a marathon and you wouldn’t want to hit the starting line without doing that. 

     A watchlist speeds up your ability to monitor high-quality companies that may get punished by macro news, or track resilient sectors that are holding up well. It’s your bridge from research to action, streamlining how you can act when the time is right.

For a full breakdown, read our guide: As tariffs return, what stocks should you be watching?

3. Protect: Know your defensive plays

   This will appeal to more experienced investors, but no matter how many trades you’ve made, you should know there is one step you can take right now to protect your assets. 

   • Outmaneuver downturns with options: Options can be used as a tool to help mitigate the risk of your portfolio's value dropping. It’s a way to hedge against downside risk without selling your long-term positions and giving up potential gains.

To learn how, read our guide: How to protect the stocks you own from tariffs.

The coming weeks will be filled with noise. Pundits will speculate, social media will shout, and markets will react. It’ll be easy to get caught up in the panic. 

But the strategic investor knows that focus is your greatest asset.

This isn't about timing the market perfectly. It's about having a plan, understanding the landscape, and being ready to act on your strategy—not your emotions. 

By doing that, you turn anxiety into anticipation. 

You position yourself to not just weather the storm, but to find what others, lost in the noise, might miss completely.

You give yourself the opportunity to come out the other side of this tariff saga looking like the S&P 500 at the end of June: enjoying newfound highs.