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 catch up on the past four weeks’ Weekly Update in the link to my Blog.

Read my latest Smart Investor newsletter on my website. The Q2 2024 edition covers Market Review for year-to-date 2024, featuring an article on the Role of Artificial Intelligence.

 

Markets

Market scorecard as of close on Friday July 5, 2024.

Country	Equity Indices	Level	1 week	YTD
Canada	S&P/TSX Composite	22,059	0.8%	5.3%
U.S.	S&P 500	5,567	2.0%	16.7%
U.S.	NASDAQ	18,353	3.5%	22.3%
Europe/Asia	MSCI EAFE	2,364	2.1%	5.7%

Source: FactSet

• Canadian equities finished lower Friday, near worst levels as selling picked up into the close. Most sectors lower. TSX posted a 0.8% weekly gain, higher for a second straight week.

• US equities ended mostly higher Friday, with S&P and Nasdaq posting strong weekly gains and closing at fresh record highs. US markets were closed for Fourth of July on Thursday.

 

Economy

Canada

• Employment was little changed in June - edging down 1k with a 3k drop in full-time employment offsetting a small 2k rise in part-time work. But with population and labour force still surging that pushed the unemployment rate up to 6.4%, the highest reading outside of the pandemic shock since October 2017.

• Slight drops in interest rates and home prices lowered the costs of owning a home in Canada in the first quarter. These costs for an average of all housing types fell to 60.9% as a share of median household income from 63.8% in Q4 of 2023.

U.S.

• U.S. non-farm payroll gain of 206k in June was close to consensus but after downward revisions to each of April and May that shaved 111k off of employment gains in those prior months. The separately released household survey showed the U.S. unemployment rate ticking higher to 4.1%. That’s half a percent higher than the unemployment rate a year ago.

• On Thursday, we expect headline CPI growth to slow to 3.1% in June, down from 3.3% in May—marking a third consecutive monthly deceleration. Our base case assumption is that the upside inflation surprises earlier this year will delay the start of the Fed’s easing cycle compared to most other advanced economy central banks. We look for the first cut from the Fed in December.

Further Afield

• Britain's new Prime Minister Keir Starmer pledged on Friday to use his massive electoral majority to rebuild the country, saying he wanted to take the heat out of politics after years of upheaval and strife. Sterling , the strongest major currency against the dollar this year, nudged higher on Friday when the scale of Labour's victory became clear. The UK-focused FTSE 250 share index rose to its highest since April 2022.

 

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

 

Regards,

Shiuman