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Toron AMI Commentary


Global Equities Benefited from the Synchronized Uptick in Global GDP Growth in Q1 2017

Charles Lannon, Portfolio Manager, NexGen Global Equity Fund

 

Global equities, as represented by the MSCI World Index, returned 5.35% in Q1 2017 (in Canadian dollar terms, net of dividends). Sector leadership this year shows a marked shift from the types of stocks that enjoyed an initial bump in the aftermath of Trump’s victory. Thus far in 2017, cyclical stocks and industries are no longer outperforming. This likely reflects a more sanguine appreciation of the challenges that the new administration faces in implementing its agenda. It might also reflect a consideration as to whether or not the suite of policy proposals can instill the confidence necessary to accelerate U.S. GDP from the 1.6% growth rate that Bloomberg consensus expects this year. Regardless, global equities undoubtedly benefited from the synchronized uptick in global GDP growth with key PMI’s from the U.S., Europe, China and Japan remaining clearly above 50, a level that denotes growth and expansion.

 

 

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Global Equities In 2017: Will Better Global Growth Justify Rising Valuations?

Charles Lannon, Portfolio Manager, NexGen Global Equity Fund

 

Global equities, as represented by the MSCI World Index, posted modest gains in 2016 of 5.17% (in Canadian dollar terms, net of dividends). Most of the return can be attributed to the post-Trump election victory rally which characterized Q4, where the Index posted a quarterly return of 4.57%.

 

 

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U.S. Earnings Back in Growth Mode

Charles Lannon, Portfolio Manager, NexGen Global Equity Funds

Global equities, as represented by the MSCI World Index, returned 6.09% in Canadian dollar terms in Q3. The sharp sell off in stocks following Britain’s unexpected vote to leave the European Union on June 23rd proved to be short lived as equities started to recover in early July. U.S. large capitalization equities, as represented by the S&P 500 Index, would go on to hit successive new highs throughout the summer, before ultimately establishing a new all-time closing high of 2190 on August 15th.

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Brexit, Earnings and the Second Half of 2016

Charles Lannon, CFA, Senior Vice President and Head of Global Mandates, Cidel Asset Management

Global equities, as represented by the MSCI World Index, returned 1.2% (net dividends) in Canadian dollar terms in Q2 and -5.2% year to date. The NexGen Global Equity Tax Managed Fund, Capital Gains Class returned 2.0% in Q2 and -3.3% year to date. Despite the quarter’s benign returns, the quarter was marked by volatility.

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Q1 2016 Update – Economic Resilience Despite Oil’s Collapse

Charles Lannon, CFA Partner and Head of Global Mandates Toron AMI

Global Equities, as represented by the MSCI World Index, returned -6.35% in Canadian dollar terms in Q1 2016. Markets had a violent start to the year as stocks followed oil lower through early February, before oil (and thus stocks) recovered into quarter end. Over the long term, lower oil prices are a net benefit for global GDP and corporate profitability. But as the capital markets transition out of the era of overinflated commodity prices, risk assets need to negotiate a couple of hurdles before they can benefit from these lower prices.

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