Chart of the Week (COW)

Home prices over the past year have continued to skyrocket with Toronto and the Fraser Valley seeing the biggest gains.

According to RBC Economics, Toronto has for the first time become the most expensive city in Canada ($1.260 million average price), surpassing Vancouver ($1.255 million average price), which has seen a robust, albeit a slower pace of gains.

Covid-19 Update

Case counts have declined sharply over the past couple of weeks; although, February has already crossed all other months save for January 2022 in terms of total cases. 

We have learned not to be more than cautiously optimistic that we have turned the corner as it relates to Covid, but at least we are heading in the right direction and are likely to continue to do so over the next several weeks.

Market Update

Stocks have been on tenterhooks for the past couple of weeks as Russia’s threats of a Ukraine invasion weigh on sentiment. As captured in the table below, we would note that over the past seven or so decades, markets have been hit by multiple conflicts ranging from skirmishes to actual war:

The average decline from peak to trough has been about 6% with roughly 13-trading days needed to reach the trough and roughly 30-trading days needed to get back to the levels prior to the decline. Of course, there is a fair amount of variability around the declines, the time it takes to reach bottom and especially the time it takes to recover all of the losses.

The current selloff is 7-days old and has seen a decline in the S&P 500 of ~5.2%. So, if history is any guide (which it often is), we can probably expect another week or so of weakness; although, the bulk of the losses are likely behind us.