The Living Market Podcast

Will this jumbo rate cut be followed by more?

Canadian consumers have been in need of some serious interest rate relief, says IG Wealth Management’s Chief Investment Strategist, Philip Petursson, and the Bank of Canada gave them just that this week, with a half-a-percentage-point rate cut. While this came as little surprise (markets had been pricing in this rate cut for a couple of weeks) it was still very welcome. Philip explains what this will mean for mortgage holders, the loonie and the economy, and what kind of cuts we might expect going forward.

How tariffs could damage the U.S. economy

If elected, Donald Trump is promising to impose higher tariffs on imports from China and other countries, says Ashish Utarid, Assistant Vice-President, Investment Strategy at IG Wealth Management. Tariffs are designed to protect domestic industries, incentivize change in foreign countries and generate revenue for the U.S. federal government. However, as Ashish explains, there are several negative side effects to tariffs that could have a significant impact on the U.S. economy in 2025.  

Will the Bank of Canada surprise with a high rate cut?

In the Bank of Canada’s (BoC) next meeting, a larger-than-previously-expected rate cut of 0.5 percentage points is likely, says Pierre-Benoît Gauthier, Vice-President, Investment Strategy at IG Wealth Management. Given that inflation has been tamed (it’s now down to 2% — or 0.5% if you cut out shelter costs) and the economy has stalled in the last couple of years, it makes sense that the BoC will surprise us with a larger rate cut. Pierre-Benoît explains what this will mean for investors.

Signs of optimism from the third quarter

In his review of the third quarter of the year, IG Wealth Management’s Chief Investment Strategist, Philip Petursson delves into the reasons behind investors’ growing enthusiasm for higher-risk investments. He also gives an overview of the quarter’s highlights, including Canadian, European and (finally) U.S. central banks cutting interest rates (having won the battle with inflation); the shift to supporting weakening labour markets; the effects of Chinese stimulus measures; and the likely impact of the upcoming American elections.

China gets serious about the economy

China is finally getting serious about its economy and its stock market, says IG Wealth Management’s Chief Investment Strategist, Philip Petursson. After seeing Chinese stocks lose $6 trillion in value over the last three years, the People’s Bank of China has just announced some significant policies aimed at giving its ailing stock market a huge boost. Philip discusses whether these policies will be enough to make a difference and asks, if they do succeed, what will the consequences be for other world economies?

Does a return to yield curve normalcy indicate a recession?

The longest inverted yield curve in history is finally coming to an end, says Ashish Utarid, Assistant Vice-President, Investment Strategy at IG Wealth Management. An inverted yield curve is when long-term bonds have lower yields than short-term bonds (an unnatural situation, given that long-term bonds are riskier and therefore typically provide a higher return). Ashish explains what the end of an inverted yield curve has historically meant for the markets and whether it could signal an upcoming recession.

Will a large interest rate cut have the right effect?

The U.S. Federal Reserve (the Fed) needs to tread carefully with any upcoming rate cuts, says IG Wealth Management’s Chief Investment Strategist, Philip Petursson. Many financial commentators are expecting a significant cut (of 50 basis points) because of weakening economic data and a more volatile market. However, Philip asks, will a large rate cut have the right effect? He argues that it’s not the Fed’s job to soothe the markets and that we should keep rate cut expectations real.

The latest member of the $1 trillion club

Berkshire Hathaway, the investment company run by Warren Buffet, recently hit the $1-trillion-value mark, says IG Wealth Management’s Chief Investment Strategist, Philip Petursson. Since 1987, Buffet’s company has returned an average of 16.7% annually, considerably more than the S&P 500’s average return of around 11% over the same period. Philip explains why the company often performs well when markets are down and why his team’s tactical tilts are mirroring those of Berkshire Hathaway; cutting stakes in equities and boosting the fixed income portion.

Where are the recent gains coming from?

What drives one stock index to outperform another? This is the key question that IG Wealth Management’s Chief Investment Strategist, Philip Petursson explores in considering whether recent gains on the S&P/TSX Composite are coming from the success of the companies that make up the index, or are the gains the output of something else altogether.

Lessons we learned from this earnings season

IG Wealth Management’s Chief Investment Strategist, Philip Petursson reviews the most recent earnings season. This is when companies report their quarterly revenue (sales) and earnings (profits). Philip explains the difference between the two, how disappointing revenue can still result in increased earnings, which sectors were this season’s winners and losers, and what needs to happen for S&P 500 stocks to continue to increase in value.