Shares of Canadian companies that do business with the US government declined following President Donald Trump’s threat to bar Canadian-origin products from being sold to federal contractors. Trump declared in a social media post, 'From now on, NO RECIPROCITY – NO ACCESS!', asserting that Canadian and provincial governments ban US firms from winning contracts in Canada. The statement, made via Bloomberg Terminal, heightened concerns about escalating trade tensions between the two countries.

Canadian firms reliant on US government contracts face potential exclusion from a significant market segment if the policy is implemented. The threat reflects Trump’s broader strategy of linking market access to reciprocal treatment in government procurement. Analysts warn the rhetoric could disrupt cross-border supply chains and increase uncertainty for businesses operating in both jurisdictions.

The market reaction underscores sensitivity to protectionist rhetoric, even before any formal policy change. The Peace Bridge at Fort Erie, Ontario, was cited as a symbolic location of Canada-US trade connectivity. The development adds to ongoing friction over trade practices, despite the existence of the USMCA agreement.

Canadian officials have not yet issued a formal response to the latest remarks.