To my clients:
It was a down week for North American stock markets with the Canadian TSX finishing down 0.1%; the U.S. Dow Jones index down 0.8%; and the U.S. S&P 500 down 2.1%.
Ahead of the Easter long weekend, it will be an exceedingly short update this week…
The dominant narratives in the markets continue: inflation remains at multi-decade highs (although “core” inflation stripped of energy and food costs actually surprised to the downside in this week’s Consumer Price Index report); to combat inflation, interest rates have risen and are set to continue higher throughout 2022; and Russia/Ukraine hostilities continue in depressing fashion.
Yet, in spite of the above, the economy remains resoundingly strong. RBC’s 7-factor recession scorecard continues to flash green across the board (including the yield curve which has re-steepened after a fleeting inversion of the 2-10 year portion of the curve… see last week’s update here for more). While current stock market conditions remain unsettling, in the absence of a credible threat of recession, equities (i.e. stocks) should be given the benefit of the doubt. Recession is not imminent, so client portfolios remain overweight equities.
That’s it for this week. Enjoy your long weekend,
Nick
Nick Scholte, CIM, FCSI
Senior Portfolio Manager
Scholte Wealth Management
RBC Dominion Securities Inc. │ Tel: 604.257.7569 │ Fax: 604.235.9950
3200-1055 West Georgia │ Vancouver, BC │ V6E 3P3
Toll Free: 1.844.665.9900 │Email: nick.scholte@rbc.com
Visit Our Website: www.nickscholte.ca
We accept new clients primarily by referral from our existing clients. If you have family or friends who would be a good fit for our specialized wealth management services, please let us know.
Any recommendations herein are for the exclusive use of clients of RBC Dominion Securities and Investment Advisor Nick Scholte. Any other direct or indirect recipient of this email should consult with his/her own licensed investment advisor prior to implementing any investment action he/she may be contemplating.