Morning. In focus today, we look at why disparate forces are lining up against Trump: Builders, booze-makers, unions and even MAGA supporters. SAD!
Up first
In the news
Trade: Canada is ready to “get tougher” if U.S. trade deal isn’t reached before the Aug. 19 deadline, Prime Minister Mark Carney says.
Pharmaceuticals: Health Canada’s backlog of generic drug applications has doubled over the past year.
Defence: Canada’s banks are facing roadblocks to financing defence companies’ ambitious plans.
Real Estate: Toronto home sales and prices climbed in July, a sign that the country’s largest real estate market could be on its way back up.
Trump last week in Hagerstown, Md.PETE MAROVICH/The New York Times
In focus
The call is coming from inside the house
U.S. President Donald Trump said yesterday that Iran and Oman were close to a deal to reopen the Strait of Hormuz, a move that would help bring an end to the war and lift pressure on the global economy.
Reopening the crucial trade route would certainly soothe energy markets, which are wobbling between relief over a potential ceasefire and worry over continued attacks.
But it might also have the effect of calming the increasingly loud chorus arguing against Trump’s war and tariff policies in the United States, made up of Republican leaders and voters (including MAGA enthusiasts), major unions and the alcohol industry.
The Republicans
The U.S. House of Representatives passed a resolution last month to halt the country’s military action in Iran, helped by the support of four members of the GOP.
Those members said they were defending constitutional principles that limit a president’s ability to enter the country into a war without congressional approval.
But they were also joining forces with a Democratic Party that was largely framing the war-powers resolution around affordability. Moving the focus away from pocketbook issues has left vulnerable Republicans terrified of voter backlash that could cost their party its slim majorities in both chambers of Congress in the November midterms.
The voters
Earlier this week, Americans picked Democrats over Republicans as better stewards of the economy for the first time in nearly a decade in a Reuters/Ipsos poll. And their approval rating of Trump’s performance as President has fallen to 35 per cent – one percentage point away from his lowest this term.
You can almost trace the rise of oil against his party’s weakening approval ratings on the economy. U.S. households have been hit by soaring gasoline prices, too. (Tariffs haven’t helped, but that source of pain might not be as visible.)
The MAGA set
Even some of Trump’s most loyal supporters are showing signs of discontent. A recent poll conducted by Politico showed that support for the Iran war had plummeted among those in the “Make America Great Again” movement.
While many MAGA supporters have not abandoned the war, their support appears to be softening. A growing percentage say the U.S. should continue fighting only if the economic costs do not rise, and 1 in 5 now favour ending the conflict entirely. (The poll did not ask respondents how that would be achieved.)
The builders
Both tariffs and the war in Iran are making it more expensive to build homes in the U.S., The Globe’s Olivia Grandy writes.
During his second term, Trump has imposed tariffs on a range of goods used in construction, renovation and home furnishings. Add those on top of long-standing taxes on imports of Canadian softwood lumber, and the bill gets bigger and bigger for American builders. And before you reach for your calculator, add the high price of borrowing, fuelled by uncertain trade policies and spiking bond yields.
“America has a problem: We have a shortage of housing,” said Anirban Basu, chief economist at the Associated Builders and Contractors, a national U.S. trade association. “But we’re doing so many things to drive up the cost of housing,” he added, including “these tariffs that impact a variety of construction inputs.”
The unions
Two major American private-sector unions – representing hundreds of thousands of manufacturing workers – have announced their strong opposition to Trump’s new suite of tariffs on Canadian goods. They are calling on the White House to reverse course, Vanmala Subramaniam reports.
The United Steelworkers and the International Association of Machinists and Aerospace Workers sent a letter to U.S. Trade Representative Jamieson Greer, requesting that the White House reconsider imposing the levies, and return the U.S.-Canada trade relationship to more “stable, balanced footing.”
The USW has often publicly supported Trump’s trade policies.
The booze-makers
An American industry group calling itself the Toasts Not Tariffs Coalition is calling for the Trump administration to put a cork in its fight with Canada. And the U.S. industry is right to fear a nasty hangover from the trade war, Rita Trichur says.
The coalition said Canadian provinces’ decision to remove U.S. spirits from retail shelves was in retaliation for Trump’s much broader tariffs.
Now, in retaliation for that retaliation, Trump has imposed 50-per-cent tariffs on spirits from Canada.
“The beverage alcohol and hospitality sectors continue to be caught in the middle of trade conflicts it did not create,” the coalition said.
Charted
Searching for signs of life: Has Canada’s biotech moment finally arrived? As the world’s life-sciences sector rebounds, Sean Silcoff writes, Canadian drug developers are poised to prosper. But can the sector avoid getting hollowed out by acquisitive pharma giants?
Quoted
When my children were babies, I used to have them sitting on the glass, and I’d play. They would follow the ball – I guess the sounds and the flashing lights and everything was attracting them.
— Dave Astill, organizer of Ontario Pinfest
Meet the Pinball wizards, whose love of the game runs deep.
Up next
More files we’re following
Before the bell: Earnings include BCE Inc., Open Text Corp., Restaurant Brands International Inc. and AtkinsRéalis Group Inc.
On the job: More questions are emerging over the role of Canada’s federal vetting process after the arrest of a NATO intern on espionage charges.
Morning update
Global markets were mixed in cautious trading as investors assessed prospects of a U.S.-Iran peace deal while also taking in a slew of corporate earnings reports.
Wall Street futures were also mixed, with the Nasdaq in the red. TSX futures pointed higher after Canada’s main stock market closed at a fresh record high yesterday.
Overseas, the pan-European STOXX 600 was up 0.44 per cent. Britain’s FTSE 100 rose 0.18 per cent, Germany’s DAX gained 0.22 per cent and France’s CAC 40 advanced 0.7 per cent.
In Asia, Japan’s Nikkei closed 0.93 per cent lower, while Hong Kong’s Hang Seng dropped 1.49 per cent.
The Canadian dollar traded at 71.44 U.S. cents.