MK Memo

With markets making headlines, our Investment Committee wanted to reach out to provide our thoughts on the current economic environment. It has been a challenging few weeks for the global equity markets, with most having been relatively weak of late. There is no one factor to blame. While inflationary pressures, the war in the Ukraine and the implications for central bank interest rate policy remain the core issue, we also have geopolitical events, a stumbling China and supply chain issues still lingering. All of which are front and center in the media and have been causing some unease in the markets.

While this budget shifts away from pandemic measures, other current events and realities are at the forefront. These include inflation, housing affordability, the transition to a green economy.

As market volatility persists, weakness in equities may have a surprising benefit. We look at several factors that may impact the macro outlook.

As the economic front expands with sanctions, we look at investment ramifications, including a potential “growth scare” and its impact for equity markets.

After almost no volatility in 2021, volatility is upon us with interest rate hikes to combat inflationary pressures and Russian’s invasion of the Ukraine. We expect market volatility to continue into the months ahead.

Find out if you can designative your vacation property or cottage as a principle residence for tax planning. MKPW’s in-house Financial Planner can discuss these planning opportunities with you and your family.

After your strong returns in equities this year, we feel it appropriate to rebalance portfolios back to target weights.

While the Federal Reserve essentially commits to keep rates low, are aren’t so sure they can forever. How good have the markets been? The U.S.'s S&P500 has not seen a 5% drawdown since October of last year, its longest streak since 2018.