As we look towards the new year, IG Wealth Management’s Chief Investment Strategist, Philip Petursson looks at the six key themes that he feels will have big impacts on the markets in 2024. Considering all the factors, he believes the data points to a general sense of improvement. And improvement, he says, brings opportunity.

Inflation dropped to 3.1% in October, but it would have been much lower if it weren’t for the rise in mortgage interest costs, says IG Wealth Management’s Chief Investment Strategist, Philip Petursson. He examines the impacts of higher mortgage payments on consumer behaviour and retail sales, and discusses the likely timing for the Bank of Canada to make a rate cut.

There are three key reasons behind the recent fall in oil prices, says IG Wealth Management’s Chief Investment Strategist, Philip Petursson. Conflicts are not having the impact on prices that was expected, which has reduced the impact of speculators. Oil output is up, with stockpiles increasing, and demand (particularly from China) is down. Philip explains what this means for the economy in general and Canada in particular.

This earnings season delivered some mixed messages, says IG’s Assistant Vice-President, Investment Strategy,  Ashish Utarid. While 82% of S&P 500 companies outperformed earnings projections, only 48% outperformed total sales expectations. Ashish dives into these apparently contradictory results to explain what they mean for manufacturing, consumer behaviour and a likely recovery.

IG Wealth Management’s Chief Investment Strategist, Philip Petursson says that while the current investing landscape is undoubtedly challenging, it’s important to remember that a weak economy does not automatically mean poor market returns. Philip shares his tips for investing in a volatile environment and reminds us that negative economic data has historically been followed by strong market returns.

The U.S. Federal Reserve, or the Fed as it’s known, is once again caught between a rock and a hard place, says IG Wealth Management’s Chief Investment Strategist, Philip Petursson. On one hand, the Fed doesn’t want to hike interest rates and trigger a recession into 2024. On the other, it sure doesn’t want to slash them. Philip says markets are beginning to come to terms with this standoff.

IG Wealth Management’s Assistant Vice-President, Investment Strategy, Ashish Utarid says, when we delve into investment risks, it’s essential to discern between two primary types: systemic and non-systemic risk. He says investment strategy takes empirical data from around the world, and by interpreting these indicators, his team provides insights for an investment decision or thesis. He says what has changed in the last decade is the impact of mass media on investor sentiment — which requires insights into geopolitical risk.

It can be impossible to truly predict the markets, even when you think you have all the data at your fingertips, says IG Wealth Management’s Chief Investment Strategist, Philip Petursson. Philip explains what happened when Jane Street, a quantitative trading firm, managed to predict Donald Trump’s election victory in 2016 and used that information to bet on the overnight futures market.

This week, IG Wealth Management’s Assistant Vice-President, Investment Strategy Ashish Utarid explains how the markets are reacting to long-term bond yields outpacing short-term yields. While this situation often foreshadows a recession (as do higher-for-longer interest rates), other economic data — such as the strong labour market, tamed inflation and improving manufacturing — suggest a soft landing.   

September is usually the worst month of the year for equity markets, says IG Wealth Management’s Chief Investment Strategist, Philip Petursson. However, there’s much more to current stock market volatility than seasonal precedent. Philip explains the reasons behind volatility, including the role that high bond yields play in reducing stock value. He also suggests the kind of stocks to focus on in this high-interest-rate environment.   

IG Wealth Management’s Chief Investment Strategist, Philip Petursson describes rising oil prices as being like a tax on global consumers. He explores the reasons behind oil’s recent jumps in price, how those increases are likely to affect consumer spending and whether this most recent oil shock is likely to bring about a recession, as has happened in the past.

The Bank of Canada’s goal of lowering inflation is having a noticeable impact on the economy, says IG Wealth Management’s Assistant Vice-President, Investment Strategy, Ashish Utarid. Higher interest rates have increased mortgage costs by as much as 30%, which in turn are contributing to current inflation levels. Ashish explains how this has all led to reduced consumer spending and an economy that’s been practically stagnant for the past four months.

IG Wealth Management’s Chief Investment Strategist, Philip Petursson says that common sense might have you believe that your portfolio needs the best asset managers in the best asset class. However, historically, top performing asset managers rarely maintain their high position from one year to the next. In that case, how can you make sure your portfolio has a steady, dependable performance?

IG Wealth Management’s Chief Investment Strategist, Philip Petursson says the aim of an investment portfolio is to maximize the return for every risk taken. He says the inherent challenge is that both risk and return are variables that fluctuate. This week he looks at the complexities that investors face and considers what the optimal strategy might be in such an ever-changing investment landscape.

IG Wealth Management’s Chief Investment Strategist, Philip Petursson says there’s no shortage of market doomsayers , but the attention they garner doesn’t necessarily mean their predictions are accurate. This week Philip looks at the historical data for periods like the present – with slowing growth and falling inflation – and draws a very different conclusion than the pessimists.

IG Wealth Management’s Chief Investment Strategist, Philip Petursson says throughout financial quarters, companies set earning estimates and then progressively lower them until the final figures beat the expectations. And then everyone cheers. Philip says the 2023 Q2 earnings season followed the same script, but with a twist — expectations were even more subdued. This week he looks how companies performed. 

Forecasting is a tricky business, says IG Wealth Management’s Chief Investment Strategist, Philip Petursson. However, recent data suggests that high inflation is behind us (at least in Canada and the U.S.) and that the Fed and Bank of Canada are done with rate increases for now. However, while Philip doesn’t forecast a full-blown recession, he believes the latest data from China means that we can’t let our guard down just yet.

After the NASDAQ’s phenomenal recent performance — up 40% from its low in 2022 — IG Wealth Management’s Chief Investment Strategist, Philip Petursson says, great; now what next? With the NASDAQ trading at 50 times its earnings (the historical average for U.S. stocks is 16 times earnings), Philip examines sectors and regions that are still comparatively undervalued, and which could present opportunities for investors willing to go against the grain, such as international, Canadian and emerging market equities.

IG Wealth Management’s Assistant Vice-President of Investment Strategy, Ashish Utarid explores China’s meteoric economic rise. Since 2001, when the country joined the World Trade Organization, with exports of around US$200 billion, China has grown to the point where it had exports of US$3.6 trillion in 2022. Ashish believes that, given China’s commitment to ongoing economic growth, and its huge industrialization and urbanization, every investor should consider exposure to Chinese assets.

The NASDAQ has dominated the market in the first half of the year, with an increase of 38% so far, driven by the surge in the tech industry, says IG Wealth Management’s Chief Investment Strategist, Philip Petursson. However, the Weightful Eight (the top tech companies) have recently been losing ground, meaning there could be more diverse opportunities in the latter half of the year, which could be good news for more diversified portfolios.

An inverted yield curve is an infamous predictor of recession, says IG Wealth Management’s Chief Investment Strategist, Philip Petursson. But it can also signal opportunity. Whether the economy experiences a soft landing, hard landing — or even no landing, fixed income is positioned to deliver favourable returns for investors.

With Nvidia recently joining the elite group of trillion-dollar companies, IG Wealth Management’s Assistant Vice-President, Investment Strategy, Ashish Utarid discusses what it takes to reach this milestone. He examines the handful of companies that make up the group so far and how Nvidia grew from a $75-billion company to its current trillion-dollar valuation in just four years.

Inflation is like a speeding train, says IG Wealth Management’s Chief Investment Strategist, Philip Petursson. Once it’s built up speed, it’s hard to stop without major consequences. He examines the recent drop in inflation, how he expects inflation to continue for the rest of the year, the Bank of Canada’s likely response and how all of this will impact the economy.  

IG Wealth Management’s Chief Investment Strategist, Philip Petursson looks back at some of his predictions for 2023, including international markets rebounding and the headwinds facing U.S. markets. He also looks ahead at the reminder of the year and where any potential opportunities might lie.

IG Wealth Management’s Chief Investment Strategist, Philip Petursson explores the historical importance of consumer spending and the current state of consumers both north and south of the border. He examines the ongoing lows (including credit card debt levels, low savings and rising interest rates) and highs (a tight labour market and healthy wage growth) and what this all means for the economy.

After the Bank of Canada’s most recent and somewhat surprising rate hike, IG Wealth Management’s Chief Investment Strategist, Philip Petursson wonders if it wasn’t premature, given that the rate hikes haven’t yet impacted many mortgage holders. He also examines the likely effect of this latest rate increase on the loonie and Canadian exporters.

Supply chain issues had a considerable impact on the economy during the pandemic, says IG Wealth Management’s Chief Investment Strategist, Philip Petursson. Post-lockdowns, inventory levels soared and are only now normalizing. Philip discusses the likelihood of a resurgence in freight activity later in the year and what that could mean for manufacturing and the markets.

IG Wealth Management’s Chief Investment Strategist, Philip Petursson believes the current value of the U.S. equity market is based on some inaccurate assumptions. He feels that earnings estimates for the latter part of the year are optimistic and that a drop in interest rates is not likely any time soon. Should investors, therefore, be looking elsewhere — such as international equities and bond markets?

In this special edition podcast, IG Wealth Management’s Chief Investment Strategist, Philip Petursson and Christine Van Cauwenberghe, IG’s head of financial planning, discuss why the spring is an ideal time to revisit your financial plan. They suggest topics to discuss with your advisor, such as any life changes, tax efficiencies, possible changes to asset allocations and RESP/RRSP withdrawal strategies.  

IG Wealth Management’s Chief Investment Strategist, Philip Petursson discusses the consequences of a top -heavy market, where the eight biggest companies account for 25% of the S&P 500. He explains the impacts the “Weightful Eight” can have on the markets when you consider that a company like Apple is more valuable than the entire Chinese stock market.

IG Wealth Management’s Chief Investment Strategist, Philip Petursson discusses the causes of the recent regional bank failures in the U.S. and explains how this is different from the financial crisis of 2008. He also considers how big issues for banks can become big issues for everyone, with tighter lending standards having an impact on inflation and economic growth.

On top of manufacturing’s 11% contribution to U.S. GDP, many more companies ship, sell and service manufactured goods. This is why, according to IG Wealth Management’s Chief Investment Strategist, Philip Petursson, manufacturing data can tell us so much about the economy, including helping us to predict earnings growth and the direction of bonds.

Some ideas behind market seasonality, like “sell in May and go away”, the Santa Claus rally and the Halloween effect, still appeal to some investors looking to buy low and sell higher. IG Wealth Management’s Chief Investment Strategist, Philip Petursson explores the realities of historical returns and makes his suggestions for successfully navigating the markets between May and September.

This week, IG Wealth Management’s Chief Investment Strategist, Philip Petursson discusses the insights we can glean from earnings season. He explains how positive expectations don’t always mean good news and that we can use market expectations to our advantage, provided we tame our emotions.

The reserve currency status of the U.S. dollar is an advantage that has been helping America on the world stage since the end of World War 2. This week, IG Wealth Management’s Chief Investment Strategist, Philip Petursson shares reasons why the U.S. dollar has remained the world’s primary reserve currency. He also weighs the viability of other alternative currencies challenging its dominance.

While OPEC may not be as powerful as it was in the 1970s, it still wields a large influence over oil markets, says IG Wealth Management’s Chief Investment Strategist, Philip Petursson. He takes us through the history of the oil cartel and discusses how its recent decision to cut production could impact economic recovery and the loonie.

As the markets continue to be stormy, IG Wealth Management’s Chief Investment Strategist, Philip Petursson suggests an unlikely safe haven may have emerged: Big Tech. Current conditions seem to favour large tech firms; last month, as the majority of Nasdaq stocks lost value, Microsoft, Apple and Alphabet collectively gained by $634 billion.

Trending inflation data suggests that the Bank of Canada has succeeded in reducing inflation, says IG Wealth Management’s Chief Investment Strategist, Philip Petursson. However, while the markets are anticipating a rate cut later this year, Philip explains why he thinks this is unlikely. 

Last week, Silicon Valley Bank collapsed, which led to some volatility in the markets. IG Wealth Management’s Chief Investment Strategist, Philip Petursson explains what caused the bank’s failure, how the U.S. Federal Reserve reacted, and why this is NOT like the Great Financial Crisis.

The Bank of Canada’s governor, Tiff Macklem, has a tough decision to make, says IG Wealth Management’s Chief Investment Strategist, Philip Petursson. Keep rates stable and he’ll risk higher inflation; hike rates in line with the U.S. and he could slow down the economy even more.

It’s important to realize that some financial commentators use extreme language to get your attention; their views often lack evidence to back them up. IG Wealth Management’s Chief Investment Strategist, Philip Petursson, says it doesn’t matter what they think, it only matters what they can prove.

The labour markets in both the U.S. and Canada are proving to be much more resilient than expected. Nevertheless, IG Wealth Management’s Chief Investment Strategist, Philip Petursson believes that we could have both a strong job market and a recession, albeit one with a soft landing.

Investors often fall into two categories; pessimists and optimists, says IG Wealth Management’s Chief Investment Strategist, Philip Petursson. He believes that the optimists are in part driving the recent equity market rally, in the belief that interest rate cuts will happen later this year. The realist’s view is a little different, but bodes well for both pessimists and optimists.

People often ask the question: “Is now a good time to invest in the stock market?” IG Wealth Management’s Chief Investment Strategist, Philip Petursson, discusses the odds involved in successfully timing the market. He also explores the surprisingly small benefits of investing at the “right” time and why the best time could simply be when you have the money.

Both the S&P 500 (+6.2%) and the S&P/TSX (+7.1%) had a surprisingly strong first month of the year. IG Wealth Management’s Chief Investment Strategist, Philip Petursson, wonders if the “January barometer” and other favourable economic factors mean that equities will have an even better year than his team’s most optimistic predictions.

The Canadian dollar’s value compared to the U.S dollar is quite cyclical, but there are a couple of reasons why it can rise or fall in the short run, says IG Wealth Management’s Chief Investment Strategist, Philip Petursson. This week, he explains how the price of oil and the difference in Canadian and U.S. interest rates are likely to keep the loonie lower than was anticipated six months ago.

European stocks have long lagged behind US equities. However, IG Wealth Management’s Chief Investment Strategist, Philip Petursson, suggests that there are five compelling reasons to consider them, including much better valuations, strengthening currency, China reopening, falling inflation and growing confidence.

What kind of recovery can we expect the markets to make in 2023? On the Living Market this week, IG Wealth Management’s Chief Investment Strategist, Philip Petursson, considers several factors — continued conflict, rate hikes, inflation, earnings announcements — to answer that question. He says one thing markets hate is uncertainty, and there’s little of that left.