To my clients:
It was a down week for North American stock markets with the Canadian TSX finishing down 2.0%; the U.S. Dow Jones Index down 2.7%; and the U.S. S&P 500 down 2.4%.
to say this week other than a few quick comments on today’s market action. Prior to today, markets were mixed for the week with Canadian markets down modestly, and U.S. markets up slightly. However, earlier this morning, as he is wont to do, President Trump issued a market altering post on Truth Social that said the U.S. was calculating “massive” tariff increases in response to export restrictions China placed on rare earth minerals last evening. In reaction to this post, U.S. markets immediately dropped and finished the day about 2% lower. It is worth noting that today saw the first decline of greater than 1% in 33 trading days. In other words, markets were due for a pause – regardless of the reason.
Also, if we’ve learned anything about Trump and his tendencies, it is that it’s best not to over-react in the short term. It’s likely that Trump’s bluster is, as always, a negotiating tactic to get what he wants and the current turmoil will eventually ease – perhaps soon. So, for the time being, I prefer to focus on the trajectory of corporate earnings which are VERY supportive, and a Federal Reserve likely to cut rates further. I’ll stay the course on behalf of clients.
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
Metrotower 2, 4720 Kingsway, 12th Floor │ Burnaby, BC │ V5H 4N2
Toll Free: 1.844.665.9900 │Email: nick.scholte@rbc.com
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