Canadian stocks posted a 3.33% gain for the week. It was the second consecutive week of solid gains after the near panic on Monday August 5th. U.S. stocks were up 4% while international stocks were up 3.5%. It was a week of fireworks and champagne cork popping for equities. It’s OK to celebrate, especially if and we remain fully invested and ignore the ‘bad news’. Canadian stocks are on a win streak on the Sunday Reads.
Here’s a good post that highlights the milestones for the TSX.
And some of the fizzy highlights.
–Largest one-week point and percentage gain since the week ending Nov 3, 2023
–Up 826.98 points or 3.72% over the last two weeks
–Largest two-week point and percentage gain since the week ending Nov 10, 2023
–Up seven of the past eight weeks
–Up for seven consecutive trading days
–Up 1173.66 points or 5.36% over the last seven trading days
–Largest seven-day point gain since Monday, April 13, 2020
–Largest seven-day percentage gain since Tuesday, Feb. 9, 2021
–Longest winning streak since Tuesday, April 18, 2023 when the market rose for eight straight trading days
This is what you’ve been waiting for
The craziness of the last few weeks is quite normal. The stock markets are emotional, and ‘overly so’.
We can experience major corrections, and stocks can also languish for months and years on end. Nothing happens, and then everything happens.
Almost a year ago I offered how the waiting is the hardest part for investors. At the time of that September post markets had been treading water for a couple of years …
At times investors have to wait. We build and springload the portfolio waiting for the next aggressive move higher.
Dale, September 2023
Springloading meet 2023. 🙂
Patient investors of all types have been rewarded. I recently updated the returns for the core Canadian ETF Portfolios on Cut The Crap Investing.
Buy ETFs for free at Questrade
Here’s the ETF Portfolio Performance post, to the end of July 2024. The portfolios have added more gains in August, of course.
Canadian stock market returns over the last year have been driven by our traditional strengths – energy and materials. It’s nice to see that the very good but small Canadian tech sector has been pitching in as well. It’s too bad that the sector does not get more weighting in the index.
In the above, XIC is the TSX, ZLB the banks, XIT is tech, XMA is materials, XST is consumer staples, XEG is oil and gas (energy). Keep in mind that the pipelines have moved to a period of out performance as well. Oil and gas has been the best performer from 2020.
I put that on the table for readers in October of 2020.
Telcos have been a big drag in the Canadian markets thanks to regulators (changing the rules), increased ‘competition’ and higher borrowing costs thanks to the higher rate environment. I sold half of my Bell stock a several months ago.
If you want a hands-off approach, with lower fees, advice and planning, take a look at Justwealth, Canada’s top robo advisor.
Here’s the full sector returns for the TSX, year to date (week of August 19).
Making sense of the week
At MoneySense, Kyle makes sense of the markets.
Key stories: U.S. inflation is behaving and paving the way for rate cuts. That might relieve presssure on the Canadian Dollar. Kyle also looks at Scotiabank’s (BNS.TO) partial acquisition of a U.S. bank – KeyCorp.
More on Canadian banks
Fitch sees modest earnings growth for the Canadian banks. They suggest that Royal Bank of Canada (RBC.TO) will continue to outperform. RBC is my largest holding after Apple (AAPL) and I’m fine with that.
At stocktrades.ca Dan likes RBC and National in his top picks. That’s a very good list.
Moving south of the border
U.S. stocks show us the money / earnings. Thanks to Genevieve for this …
U.S. stocks continue to deliver on the earnings front. And we see a broadening of earnings growth and strength beyond tech. Other sectors are picking up the pace and the stock market is taking notice. It will be healthy for markets and investors if we get some bench strength.
I was thrilled to see my Walmart offer up another stellar earnings report and encouraging forward guidance. This is the beast of retail and consumer staples.
Walmart was up 7.5% for the week and is up over 40% over the last year. I will certainly be ringing up homemade Walmart dividends over the next few decades. That is, I’ll sell shares for income. That is the superior route for retirees. Mathematically there is no difference between a share sale and a dividend, except for tax purposes.
We can turn higher quality lower yielders into bigger yielders.
Here’s a key post –
Creating retirement income from your portfolio.
And … Defensive sectors for retirement.
More Sunday Reads
We’ll first head to The Retirement Manifesto for longevity lessons from a 91 year old. What are the keys to having a long and healthy life? That’s a great post filled with common sense. We might call it a common sense lifestyle.
It was a busy week at Dividend Hawk with earnings season still in play, plus many interesting stock stories.
At Banker on Wheels , they wonder if Europeans and Brits should still invest with Vanguard.
In the mix from Banker this week – The 60/40 portfolio: bonds are so back. And, how investable is Europe? Yes, I am guilty of making Eurosclerosis comments and posts 😉
GIC rates at EQ Bank
There were more cuts on the GIC rates at EQ Bank. I’ve updated the tables in that post. All said, the inflation-adjusted return available today is greater than from the interest rate peak. It’s all about the real return. Inflation is falling faster than the GIC rates.
Be sure to check out Findependence Hub each week, with new 4 posts to peruse.
This week I update the returns for the wonderful BMO Low Volatility ETF – ZLB.
Check out that 4% average annual beat from inception.
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Here’s Canada’s top-performing Robo Advisor, Justwealth. You can get advice, planning and low-fee ETF portfolios all at one shop.
Consider Justwealth for RESP accounts. That is THE option in Canada with target date funds that adjust the risk level as the student approaches the College or University start date.
OUR SAVINGS ACCOUNTS
Make your cash work a lot harder at EQ Bank. RRSP and TFSA account savings rates are at 2.5% and 3.0%. You’ll find some higher rates on GICs up to 4.50%. They also offer U.S. dollar accounts. We use EQ Bank, they have been awesome.
OUR CASHBACK CREDIT CARD
We make between $40 to $70 every month! And that’s on everyday spending. There are no fees with …
The Tangerine Cash Back Credit Card
For July we received $58.51 in cash. It was a bigger spending month. You can select 3 categories for 2% cash back.
That cash will go into my TFSA.
While I do not accept monies for feature blog posts please click here on the mission and ‘how I might get paid’ disclosures. Affiliate partnerships help me (try to) pay the bills for this site. But they don’t, ha. That will allow me to keep this site free of ads and easy to read.
Bob Wen
Re. the Tangerine credit card: My wife and I have our own Tangerine accounts and credit cards + Tangerine savings accounts. For each of our accounts we have a second card (for each other). With the 2% categories set differently for each credit card account, we each have access to six categories!
Cons: you have to carry two cards, and a note is needed on the card listing the categories. You also need a partner, but that could be a Pro too!
Dale Roberts
Ha, that’s a good idea to cover off other categories Bob. Nice. I might add that to the post.
Dale