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Ziegler Capital Commentaries


U.S. Economy to Continue to Grow at Reasonable Pace

Donald Nesbitt & Mikhail Alkhazov, Ziegler Capital Management, Portfolio Managers of NexGen US Dividend Plus Funds

U.S. GDP growth accelerated markedly between the first and second halves of 2016 and recent economic data suggests that growth will continue at a reasonable pace in the first half of this year. The Conference Board’s measure of consumer confidence hit a 15-year high in February, bolstered by expectations of favorable job and income prospects and suggesting that consumption growth will remain healthy. Optimism seems to be finally improving for businesses as well, with the National Federation of Independent Business (NFIB) Index of Small Business Optimism posting a 13-year high in January. The global economy appears to also be on the mend, with indicators for both manufacturing and non-manufacturing rising in the Eurozone and Japan over recent months.

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Markets Remain Optimistic About a Pro-Business Environment

Donald Nesbitt & Mikhail Alkhazov, Ziegler Capital Management, Portfolio Managers of NexGen US Dividend Plus Funds

The year began on a note much like it ended in December, with encouraging economic data and the financial markets optimistic over the prospects for a more pro-business environment in Washington. Commodity markets seem to be enjoying some support and the global economy also appears to be on the mend; a much more encouraging backdrop than was in place a year ago.

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Trump’s Pro-Growth Agenda Pushes U.S. Equities Higher

Donald Nesbitt & Mikhail Alkhazov, Ziegler Capital Management, Portfolio Managers of NexGen US Dividend Plus Funds

The close of 2016 found the U.S. economy in relatively good shape, driven by healthy consumer spending and a backdrop of improving business sentiment. Consumer households are in good shape, with relatively strong balance sheets and increasing income supported by a healthy job market. U.S. Economic growth registered a surprisingly strong 3.2% rate of growth in the third quarter and that momentum appears to have carried through to the fourth quarter.

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U.S. Equities Rally Post-Election

Donald Nesbitt & Mikhail Alkhazov, Ziegler Capital Management, Portfolio Managers of NexGen US Dividend Plus Funds

The U.S. Presidential election was center stage in November and what a show it was. Donald Trump’s victory over odds-on-favorite Hillary Clinton shocked the media and many political pundits that had given him little, if any, chance of winning. Conventional wisdom also held that financial markets would view a Trump victory as “disruptive” and a negative influence upon equities. Overnight equity markets initially sold-off significantly as early results indicated that Trump was leading the election but then quickly reversed and closed higher the following day.

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US Equities Pulled Back in October Amidst Uncertainty

Donald Nesbitt & Mikhail Alkhazov, Ziegler Capital Management, Portfolio Managers of NexGen US Dividend Plus Funds

U.S. equities gave up ground over the month of October over uncertainty regarding the Presidential election and a rocky start to third quarter earnings season. The S&P 500 Index lost 1.8%*, while the large-cap S&P 100 Index lost 1.4%*.  Smaller stock indices registered weaker performance, with the small-cap S&P 600 Index posting a 4.5%* loss for the month and the mid-cap S&P 400 Index down 2.7%*. Value-oriented equity management approaches outperformed Growth-tilted strategies for the month, as investors rewarded the stocks of companies exhibiting relatively favorable valuation and better capital efficiency. The Russell 1000 Value Index declined 1.6%* in October, led lower by the cyclically sensitive Telecommunication Services (-6.2%)* and the recently broken out GICS sector of Real Estate (-5.8%)*. The best performing sectors in the month were Financials (+2.6%)*, whose stocks reported relatively good third quarter earnings results, and Utilities (+0.8%)*.

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