Happy Friday from BMWM!

 

We want to wish you and your families a Happy Holiday and a Happy New Year! Please be safe and more importantly, have fun. Please remember that a newsletter will not be sent next week due to the holidays and we will resume the newsletters the following week.

 

Equity markets did not break trend this week in what has been a tumultuous year for investors to say the least. Stocks sold off sharply on Thursday, following a mid-week rally, on track for weekly losses in most major markets. Weekly initial jobless claims in the US came in lighter than consensus, but not by a large enough margin to explain the sell-off on its own. The selling pressure experienced this week was most likely caused by a very depressed liquidity environment. In other words, as the year comes to a close, market participants seek to crystalize losses for tax purposes (sellers), however, there isn't a sufficient amount of buyers in the market to offset the increase in supply. This leads to larger than usual bid-ask spreads for companies being sold, causing sharp declines. Investors anticipating a year-end rally may be left frustrated. However, such frustration fits with a 2022 in which credit tightening has stymied any attempt at a market rally.

 

The Current Account (click here to read) features storms potentially disrupting Canadians’ holiday travel plans, Canada’s single-use plastic ban coming into effect on Tuesday, Russia’s crude shipments collapsing in the first full week of a Western ban, and Germany returning looted treasure to Nigeria that was stolen a century ago.

Taylor’s word of the week is Beauteous, meaning “something that is aesthetically pleasing or beautiful”. For example, houses that are decorated for the holidays are beauteous.

 

Happy holidays to all, and for those of you who celebrate Christmas, we would like to wish you a very Merry Christmas!

See you in the new year,

 

Brenda, Matt P, Matty, and Taylor