Diamond

 

North American equity markets saw mixed results last week, which were based on a variety of factors.

Of interest to seemingly 99.9% of Canadian investors was the ratings downgrade of the major Canadian banks by Moody’s. Private sector debt has risen to nearly two times gross domestic product, and Moody’s downgraded the banks’ long-term and deposits by one ratings level. One of the contributing factors is the continued rise in house prices, causing increased mortgage borrowing, as well as credit card debt increases. The banks (Royal, Scotia, Montreal, TD, CIBC and National) who received the downgrade had their stocks drop 2-3% last week.

In the U.S., unemployment reached its lowest point since 2007 at 4.4%. Wages are up 2.5% year-over-year, which is providing the U.S. consumer with increased purchasing power. 

The results of the French presidential election, with a moderate candidate winning, have increased optimism across Europe that the inter-country cooperation will continue.

Also, analysts have predicted that Q2 corporate earnings will be a continuation of the strong Q1, reaching levels not seen for over 6 years which should bode well for investors.

I hope you are enjoying the May weather (I know I will once our son’s spring hockey is done). It’s great to see the change of seasons and the city starting to turn green.

All the best,

Kevin

 

Disclaimer – This information transmitted is intended to provide general guidance on matters of interest for the personal use of the reader who accepts full responsibility for its use, and is not to be considered a definitive analysis of the law and factual situation of any particular individual or entity. As such, it should not be used as a substitute for consultation with a professional accounting, tax, legal or other professional advisor. Laws and regulations are continually changing and their application and impact can vary widely based on the specific facts involved and will vary based on the particular situation of an individual or entity. Prior to making any decision or taking any action, you should consult with a professional advisor. The information is provided with the understanding that Harbourfront Wealth Management is not herein engaged in rendering legal, accounting, tax or other professional advice. While we have made every attempt to ensure the information contained in this document is reliable, Harbourfront Wealth Management is not responsible for any errors or omissions, or for the results obtained from the use of this information. All information is provided “as is,” with no guarantee of completeness, accuracy, timeliness or as to the outcome to be obtained from the use of this information, and is without warranty of any kind, express or implied. The particulars contained herein were obtained from sources we believe to be reliable, but are not guaranteed by us and may be incomplete. Harbourfront Wealth Management Inc. is a member of the Investment Industry Regulatory Organization of Canada “IIROC” and the Canadian Investor Protection Fund “CIPF”.

 

 

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