Below is a summary of some of the relevant news items from the Capital Markets and the Economy from the past week extracted from RBC Global Insights and FactSet Research.

You can view the past four weeks’ Weekly Update in the link to my Blog.

To read my latest 2023 Q1 Smart Investor newsletter (What 2023 Holds, How to Invest, my list of books from last year), and catch up on back issues, go to my website.

 

Markets

Market scorecard as of close on Friday April 14, 2023.

Country	Equity Indices	Level	1 week	YTD
Canada	S&P/TSX Composite	20,580	1.9%	6.2%
U.S.	S&P 500	4,138	0.8%	7.8%
U.S.	NASDAQ	12,123	0.3%	15.8%
Europe/Asia	MSCI EAFE	2,146	2.2%	10.4%

Source: FactSet

• TSX ended higher at the close in Friday range bound afternoon trading. Canadian equities closed 1.9% higher on a weekly basis.

• US equities ended lower in Friday afternoon trading, though stocks came off worst levels from the early afternoon. Major indices still logged gains the week. Moneycenter banks outperformed on better-than-feared earnings, though regionals were broadly weak. Treasuries came under meaningful bear-flattening pressure, adding to big yield increases for the week.

 

Economy

Canada

• As largely expected, the BoC has maintained the policy rate unchanged at 4.5%. After having delivered eight consecutive rate hikes (400+ bps worth) between March 2022 and February 2023, Wednesday's announcement marks the second consecutive meeting that the BoC has opted to remain on the sidelines.

• The BoC anticipates a fairly quick return to the 3% inflation mark by mid-2023. However, the central bank has explicitly recognized that the journey back to the 2% inflation target will be more difficult.

• Despite having just experienced the most aggressive rate hiking cycle since the early 1980s, labor market strength has been surprisingly resilient, with the unemployment rate (5.0%) still hovering near its all-time low.

U.S.

• The Consumer Price Index, a key measure of inflation, showed headline prices decelerating again in March, after grocery prices declined for the first time since 2020 and energy prices fell 3.5%. Meanwhile, the core consumer prices measure (which excludes food and energy, and is more closely watched by the Fed) failed to moderate, increasing by 5.6% in March.

• Nonfarm payrolls data showed job growth rising at a solid clip last month while the unemployment rate dropped to 3.5%, nearing record lows.

Further Afield

• European Commission President Ursula von der Leyen and French President Emmanuel Macron travelled to China together. The trip caused tensions. Von der Leyen, speaking for Europe, aims to lessen the economic reliance on China as geopolitical concerns have increased. Macron, heavily criticized at home for wanting to increase the retirement age, opted for a more conciliatory message.

• The Bank of Japan officially welcomed its new chief this week. In his inaugural news conference, Governor Kazuo Ueda reiterated his view that the central bank should continue with monetary easing for now.

 

Notes About Companies in Model Portfolio

• Apple (AAPL) announced on Thursday a major acceleration of its work to expand recycled materials across its products, including a new 2025 target to use 100 percent recycled cobalt1 in all Apple-designed batteries. Additionally, by 2025, magnets in Apple devices will use entirely recycled rare earth elements, and all Apple-designed printed circuit boards will use 100 percent recycled tin soldering and 100 percent recycled gold plating.

• Brookfield Infrastructure Partners L.P. (“BIP”) through its subsidiary Brookfield Infrastructure Corporation (“BIPC”) and its institutional partners (collectively, “Brookfield Infrastructure”), jointly announce a definitive agreement to acquire Triton in a cash and stock transaction valuing Triton’s common equity at approximately $4.7 billion and reflecting a total enterprise value of approximately $13.3 billion. Triton is the world’s largest owner and lessor of intermodal containers and is a critical provider of transportation logistics infrastructure supporting global supply chains. The Company has built an irreplaceable asset base, delivers high levels of utilization and maintains strong customer relationships.

 

Feel free to contact me with any questions and/or to discuss investment ideas.

I appreciate the opportunity to serve you and look forward to continuing to help you accomplish your long-term financial goals.

 

Regards,

Shiuman