Market Commentary

Making Cents of the Markets

Join us for the first Ready.Set.Retire! of 2022!

To set the new year off to a good start, Jon and Lori are discussing financial tips for 2022. Lori goes over her market outlook for the year, including why we remain bullish and what sectors we believe will benefit in an inflationary environment. Set yourself up for financial success, and 2022 retirement readiness this year!

Listen here.

 

Listen now to the most recent Making Cents of the Markets on CKNW, where we discussed higher interest rates in the US, and the Federal Reserve’s meeting notes. We also talked about our market outlook for 2022, and how all of this affects the BC Real Estate Market.

Click to listen here.

 

Beyond the Markets

Vancouver’s original street food festival, Street Food City X will be returning to celebrate their 10th year anniversary in Vancouver. Taking place just outside of the Vancouver Art Gallery from January 15-23, the festival features a variety of cuisines and some of Vancouver’s most popular food trucks.

You can check out their website here for additional information.

 

Be in the Know

North American markets were relatively flat on the week as investors digested more news around inflation, the possibility of increasing interest rates, and the start of earnings season. Strength in markets remained around economically sensitive areas, although we were pleased to see some stabilization in areas like technology that have been impacted lately by fears of interest rates heading higher. The expectation is that central banks in both Canada and the US will increase rates three times this year, however, we believe that these expectations may change as the year unfolds.

Earnings season is underway and several US banks released their Q1 results today which were mixed at best. A common trend showed expenses increasing over the last year due to wages heading higher. Growth remains intact but it still is too early to get a good feel on earnings, and more importantly, guidance for the upcoming year. We look forward to getting a better gauge of company earnings next week as many more companies begin to report their fourth-quarter results.

US inflation was the most notable economic news this week, as it came in line with expectations advancing 7% over the last year with pricing pressures in shelter and food. Higher prices may have started to weigh on consumer spending as US retail sales fell by 1.9% in December, although we believe Omicron likely impacted these figures as well. The silver lining is that retail sales remain 17% higher over the last year as the longer-term trend remains positive. Next week, we await inflation and retail sales data in Canada with our focus remaining on earnings season.

 

Our Strategy

Our Legacy Portfolios are all flat to positive to start the year which we are happy to report since US indices and the US dollar are down on the year. We have been able to create outperformance by focusing on economically sensitive areas that have seen continued flows as investors look beyond Omicron. We made minor changes to portfolios this week as we took profits in one of our Canadian industrial holdings that we believe has moved well beyond the company’s current growth trajectory.

As the start of 2022 has already shown us, active management will be paramount in taking advantage of shifts that are taking place in the market as we look forward to the opportunities developing in the technology sector. In terms of earnings for our portfolio companies, the highlight was Aritzia which was up 19% in a day as it crushed estimates for the fourth quarter as their expansion in the US and strong brand has truly set them apart as one of the leading retail companies in North America.

 

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