Weekly Market Update July 8, 2019

Last Week in the Markets: July 1st – 5th, 2019

Screen Shot 42.png

What happened?

  • Now that we’ve gotten past Canada Day and Independence Day, the 1st and the 4th, respectively, some interesting and purely coincidental numbers have emerged:

    • Both the TSX and the Dow have gained exactly the same amount at 15.41% year-to-date

    • The Canadian dollar’s gain this year when added to the TSX advance (4.24%+15.41%) is almost equal to the S&P 500’s increase of 19.29%

    • Last week gold lost exactly the same amount, $13.60, that it gained the preceding week

    • Lastly, the S&P 500 and the Dow hit new highs at 2,996 and 26,966. The NASDAQ also reach a new high, peaking at 8,176.

  • The TSX delivered a solid 1% gain last week, led by technology and industrial sectors. The drop in the price of oil didn’t help as the Energy sector prefers rising prices.

The MSCI All Country World Index (ACWI) turned in a similarly strong performance last week by moving ahead over 1%, and over 16% for this year. The developed markets have gained more than 17% and emerging markets have gained just under 10% in 2019. Both are very strong performances despite 10% seeming lacklustre (source: https://www.msci.com/end-of-day-data-search).

What’s ahead for this week?

  • In Canada, the Bank of Canada will release its latest interest rate decision. A recent rise in Gross Domestic Product growth in Canada has reduced the need for a rate cut. It has not been typical for our central bank to adjust interest rates ahead of changes from the Fed in the U.S. Thankfully we will only have to wait until Wednesday to know our latest monetary policy moves. (source:https://www.theguardian.pe.ca/business/panel-of-economists-believe-bank-of-canada-will-hold-its-overnight-rate-330391/) Additionally, housing information will be announced with May’s building permits and new housing price index and June’s housing starts.

  • In the U.S., inflation numbers will dominate the economic news with both the Consumer Price Index (CPI) and the Producer Price Index (PPI) being released along with May’s wholesale inventory numbers.