Market Update Q2 2015

July 24, 2015

Message from the Chief Investment Officer

Markets remained relatively flat in the second quarter of 2015 resulting in a lower rate of growth for MD portfolios during this time. But it is worth bearing in mind that this covers just the three-month period of April to June. Addressing the bigger picture, or our ultimate benchmark, we can proudly report that MD portfolios continue to progress well against client goals.

Among the highlights of the second quarter was the stabilization of oil prices. The price of oil (West Texas Intermediate) rose 24% over the quarter from a relatively low base. It appears that the negative impact from the dramatic decline in oil prices was “front loaded” to the beginning of 2015 and Canada will likely see improved economic growth by the end of 2015.

We also note that consumer spending, which has helped the Canadian economy to outperform its Group of Seven (G-7) peers after the Global Financial Crisis, is well supported by continued access to inexpensive credit, low inflationary pressure, and continuing improvements in the labour market. In May 2015, the Canadian economy added 58,900 jobs.

Compared to other advanced countries, Canada remains well positioned to receive further stimulus via the Bank of Canada’s monetary policy and the potential for additional spending by fiscal policy makers.

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