Here are five things you need to know this morning

U.S. follows through on tariffs – Canada responds: It is a seismic threat to the Canadian economy, with implications for all businesses, as well as financial markets. U.S. President Donald Trump has delivered on his threat to hit Canada and Mexico with sweeping import levies and doubled an existing charge on China, spurring swift reprisals that plunged the world economy into a deepening trade war. The U.S. tariffs — 25 per cent on most Canadian and Mexican products and raising the charge on China to 20 per cent — apply to roughly US$1.5 trillion in annual imports. Canada has hit back with phased levies on $155 billion worth of U.S. goods while China imposed tariffs of as high as 15 per cent, mainly on American agricultural shipments. Stock futures are pointing to further declines after yesterday’s biggest drop for the S&P 500 this year. Canada’s main stock index fell by 1.5 per cent. Prime Minister Justin Trudeau and members of his cabinet will speak at 10:30 a.m. eastern time. BNN Bloomberg will cover developments live as they happen and bring you analysis throughout the day from investment professionals, economists, trade experts, and reporters.

Royal Bank CEO warns of ‘enormous pain’ from tariffs: The CEO of Royal Bank is speaking out against the tariffs. At an industry conference this morning, Dave Mckay said it’s frustrating to see tariffs impede growth. McKay says tariff volatility has already hit consumers in Canada and the U.S., and the auto industry in particular will feel “enormous pain”, that will hit consumers. Nevertheless, McKay says he’s hoping for the “best outcome”, with the tariffs proving to be short-lived.

U.S. companies respond to tariffs: We are already seeing corporate responses to the tariff news. Major U.S. retailer Target is projecting little to no sales growth this year. Target also warned of “meaningful” pressure on profit in the coming months, citing factors such as weak February sales and uncertainty around consumer sentiment and tariffs. Target’s Chief Executive Officer warned that consumers would see price increases over the next couple of days in response to the U.S. import tariffs. Meanwhile Best Buy’s CEO is warning price increases are “highly likely” in the wake of the new tariffs. The company says shoppers will remain constrained by inflation this year as it forecasts that annual sales could be little changed.

Pet Valu too: Here at home, Canadian companies are also responding to the tariff news. This morning retailer Pet Valu reported a slight increase in quarterly profit. Revenue topped expectations, largely due to growth in franchise and other revenues but was partially offset by a decline in retail sales. Regarding tariffs, the company says it is “closely monitoring the evolving governmental foreign trade environment and believes it has the appropriate mechanisms in place to adapt, as necessary.”

Couche – 7-Eleven talks continue: Seven & i Holdings says a media report saying it’s decided to reject a buyout offer from Canada’s Alimentation Couche-Tard isn’t true. The operator of 7-Eleven convenience stores says it is still having constructive discussions with Couche-Tard. Earlier, the Yomiuri newspaper reported that Seven & i plans to reject the takeover proposal over antitrust concerns in the U.S. The news dragged the company’s stock lower by as much as 12 per cent, although it recovered in the afternoon to trade down 7.8 per cent after the denial. The stock was already trending lower after a proposed management buyout by the founding Ito family collapsed last week.