To my clients:
It was a mixed week for North American stock markets with the Canadian TSX finishing up 1.9%; the U.S. Dow Jones Index down 1.2%; and the U.S. S&P 500 down 1.4%.
Ultra-brief update this week with just the following three quick notes:
- The delayed employment report came in tis week better than expected, as did the CPI inflation report. Combined with a strongly growing economy, the environment might potentially be described as “Goldilocks”, except…
- ... AI concerns continue to disrupt the market. Predominantly software development is being impacted, but so too are some adjacent industries.
- I executed some trades in client accounts this morning by selling Union Pacific railroad (clients also own CP Rail which has been maintained). Union Pacific was sold on the back of a recent surge in share price after underperforming for most of the past year. It was nice to book a profit in excess of 10% after a year of underperformance. I also sold a very small portion of Palo Alto Networks which is a cyber security provider. While I believe whole heartedly in the continued importance of cyber security platforms such as what Palo Alto offers, the reality is that this company (like many) is being caught up in AI disruption fears. I will continue to evaluate the implications on this front. With the proceeds from the sale of Union Pacific and the small partial sale of Palo Alto, I re-entered Alphabet (aka “Google”) which has declined more than 10% from its recent high and offered me an opportunity to get back in a name that I regret selling late last year.
That’s it for this week. All the best,
Nick
Nick Scholte, CIM, FCSI
Senior Portfolio Manager
RBC Dominion Securities Inc. │ Tel: 604.257.7569
2950 Glen Drive, 7th Floor │ Coquitlam, BC │ V3B 0J1
Toll Free: 1.844.665.9900 │Email: nick.scholte@rbc.com
Visit Our Website: www.nickscholte.ca
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