Market Commentary

Making Cents of the Markets


Listen now to the most recent Making Cents of the Markets on CKNW where we talked about the latest in markets and the economy. We also discussed the risks of DIY investing your entire portfolio, including the impact it can have on your spouse.

Listen here.

 

Beyond the Markets

Today kicks off the 8-week food and music festival happening at the Shipyards, in the heart of Lonsdale Quay! Every Friday and Saturday for the rest of the summer, you can go and enjoy the stunning views, live music, patio pop-ups, food trucks, artisan vendors, and more! The wide range of music and activities provides fun for the whole family to enjoy.

Check out the complete schedule here.

 

Be in the Know

After a week of robust earnings reports, investors were looking to finish the month off strong, although North American markets were relatively flat this week as Amazon’s earnings report fell short of analyst’s expectations and weighed on markets on Friday. It appears many shoppers have missed going to stores as this is evidence of consumer habits are changing in the post-lockdown world. Otherwise, investors digested a busy week of earnings updates, economic data, and an interest rate decision from the US Federal Reserve.

Most companies have now reported second-quarter earnings with the vast majority beating analyst estimates and profits growing 85% from a year ago. This remains the highest growth rate since Q4 of 2009 due to a lower comparison a year ago as many hard-hit sectors such as energy, industrials, and consumer discretionary have roared back to stronger levels than before the pandemic. The US economy continues to grow with Q2 GDP coming in at 6.5% though missing expectations of 8.5% as less government spending, a shortage of workers, and a cooling housing market led to lower growth.

In Canada, we saw that inflation eased to 3.1% in June from a 10-year high of 3.6% in the previous month as shelter and transportation contributed the most to the increase. Interest rates remained unchanged as investors looked for any hint of when the Federal Reserve looks to increase rates. Jerome Powell, the Fed Chair, reiterated the same message that the economy continues to edge towards their targets and that they will not taper until substantial further progress is made which we expect to occur sometime next year.

 

Our Strategy

Despite a relatively flat week in markets, most of our portfolio companies were positive to finish the week with materials, real estate, and consumer discretionary stocks leading portfolios higher. We saw strong double-digit growth from our large technology companies such as Apple, Facebook, and Google though they all pulled back from their all-time highs as they warned investors of slower growth in the quarters ahead. This was expected somewhat as such high rates were a result of the pandemic though we are not concerned and remain bullish on these leaders for years to come.

We added a few equities to our portfolios this week that focused on areas tied to the economic recovery as many stocks on our target list pulled back because capital was focused on large technology stocks before the latest earnings announcements. After the recent rally in technology stocks, we have started to see capital flow back towards economically sensitive areas and look forward to the remainder of the year as we are well-positioned and expect to finish strong!

 

Visual of the Week

The comments and opinions expressed in this newsletter are solely the work of Pinkowski Wealth Management, not an official publication of Canaccord Genuity Corp., and may differ from the opinion of Canaccord Genuity Corp’s. Research Department. Accordingly, they should not be considered as representative of Canaccord Genuity Corp’s. beliefs, opinions or recommendations. All information is given as of the date appearing in this newsletter, is for general information only, does not constitute legal or tax advice, and the author Pinkowski Wealth Management does not assume any obligation to update it or to advise on further developments related. All information included herein has been compiled from sources believed to be reliable, but its accuracy and completeness is not guaranteed, nor in providing it do the author or Canaccord Genuity Corp. assume any liability.

CANACCORD GENUITY WEALTH MANAGEMENT IS A DIVISION OF CANACCORD GENUITY CORP., MEMBER-CANADIAN INVESTOR PROTECTION FUND AND THE INVESTMENT INDUSTRY REGULATORY ORGANIZATION OF CANADA