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 2025 edition covers Market Review for Q1 2025, the impact of tariffs on markets, and how to position your portfolio during a time of disruption. Shiuman’s Corner is about the art of retail in Japan.
Markets
Market scorecard as of close on Friday June 6, 2025.
| Country | Equity Indices | Level | 1 week | YTD |
| Canada | S&P/TSX Composite | 26,429 | 1.0% | 6.9% |
| U.S. | S&P 500 | 6,000 | 1.5% | 2.0% |
| U.S. | NASDAQ | 19,530 | 2.2% | 1.1% |
| Europe/Asia | MSCI EAFE | 2,619 | 0.7% | 15.8% |
Source: FactSet
- TSX finished higher Friday, a bit off best levels. Most sectors higher. Canadian equities finishing the week up 1%, at record-high levels.
- US equities finished higher in Friday trading. Major indices logged solid weekly gains with S&P 500 finishing more than 20% above the 8-Apr post-Liberation Day low, now less than 2.5% off February record close. Market was boosted by solid May employment numbers, though report also showed downward adjustments for prior two months and hotter hourly earnings growth. Still, analysts positive on labor-market resilience though noted report backs Fed's wait-and-see approach on rates
Economy
Canada
- Amidst a "softer but not sharply weaker" Canadian economy and "firmness in recent inflation data", the Bank of Canada chose to hold rates steady again in Wednesday's meeting. The overnight rate is at 2.75%, still in the middle of the BoC's estimate for a neutral range of interest rates at 2.25% - 3.25%.
- Canada’s economy grew at a 2.2% q/q annualized pace in Q1 2025, exceeding consensus expectations and the BoC’s forecast. . Meanwhile, worrying signs in the economy have emerged as household consumption growth slowed, residential investment fell, and business investment in non-residential structures also declined, indicating sluggish economic momentum.
U.S.
- The weekly unemployment claims data from the U.S. Department of Labor also disappointed. First-time claims for unemployment benefits rose to a seven[1]month high, and the ranks of the long-term unemployed swelled to the highest level since December 2021. Given the consumer sector accounts for two-thirds of the U.S. economy, we view these labor stresses and consumers trading down as warning signs for the overall economy.
Further Afield
- The European Central Bank (ECB) cut interest rates by 25 basis points (bps) to 2% on Thursday. The Governing Council’s statement said inflation is around the central bank’s 2% target and maintained the language around a “data-dependent” approach for future decisions.
- Top U.S. and Japanese trade officials are meeting for a fifth round of negotiations this week. Japan’s top trade negotiator, Ryosei Akazawa, said that “Japan will continue to strongly urge the U.S. to reconsider its series of tariff measures.” Japan, along with many U.S. trading partners, is facing a 25% levy on cars and 10% levy on all other goods. The 10% tariff is set to rise to 24% in early July if an agreement cannot be reached. We think a deal is likely, but may not occur until after elections for the upper house of Japan’s legislature in July.
Feel free to contact me with any questions and/or to discuss investment ideas.
Regards,
Shiuman
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