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Welcome,
We are very pleased to send you our monthly financial newsletter to keep you abreast of financial markets and world economy. We hope that you will enjoy reading these articles. As always, we welcome your comments and questions.
Sincerely,
Team Beauregard Farina Tourangeau
1250 boul. René-Lévesque West
Suite 1500
Montréal, QC
H3B 4W8
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Market Returns
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Value as of
Oct. 31st 2015*
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2015
Year to date
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2014
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S&P / TSX
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13,529
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-7.5 %
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7.4 %
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S&P 500
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2,079
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1.0 %
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11.4 %
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Euro Stoxx 50
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3,418
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8.6 %
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1.2 %
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MCSI emerging markets
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848
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-11.3 %
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-4.6 %
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Oil ($US/Barrel)
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$ 46.59
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-21.6 %
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-41.6 %
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Gold ($US/oz)
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$ 1,141
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-3.8 %
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-1.9 %
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$CAD / $USD
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$ 0.76
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-11.7 %
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-8.5 %
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Source : Bloomberg, Richardson GMP Limited
*Values are in local currency
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Investment Strategies
Quarterly Market Outlook: The Great Reset
Global equity markets, including Canada and the U.S., ran into a correction over the past couple months that has clearly heightened investor concerns. Continued deceleration of economic growth across emerging markets and the subsequent hit to commodity prices is a big contributor, as is the continued uncertainly around when the Fed will begin to raise interest rates. This correction, while painful, is helping reset valuations and address some of the excesses in the market place.
Given that the majority of economic data continues to point to expansion, albeit slow, this reset may lay a foundation to help markets move higher in the coming quarters.
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Tax & Estate Planning Strategies
Year-end tax reminder
Financial planning is time sensitive. While the following list is not exhaustive, here are some items that must be considered, incurred or paid prior to year-end in order to be included in your 2015 tax return.
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In the news
Central Banks running out of options
It's been seven years since the recession, but we have yet to see a significant global turnaround. Through the next 12 months, we're thinking the global economy will grow by about 3%, compared to the previous norm of 4% to 4.5% real growth. There has been significant ammunition deployed by various central banks around the world. Despite quantitative easing, foreign exchange intervention and the deployment of zero-bound interest rates, we're still getting what we would call disappointing results.
There's still marginal room to lower interest rates in Canada. But investors would worry if we experience another relapse of the global economy. In terms of what's left in the cupboard, the Fed is still thinking of raising interest rates, and they could backtrack. That would most likely mean increasing QE efforts.
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Economic recovery riddled with risks
Considering uncertainties around China and the prospect of U.S. Federal Reserve tightening, the strategists describe the markets as struggling to find direction and underscore the importance of separating market noise from signal. Volatility reached its highest level in four years in August as markets around the world pulled back, including a 10% retreat in the U.S., and about 15% in the U.K., Europe, Australia and Japan.
However, the experts believe the U.S. economy is robust and do not believe China will derail the global economy. The key question for investors now is whether the market turbulence is simply a retreat from overbought conditions or the beginning of a new bear market.
Read more
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Why Canada is falling behind
The Canadian economy will continue to underperform over the next year, relative to the U.S. and on a global scale. That's due to our high level of consumer debt, and to weak oil prices and exports. Even though the U.S. continues to recover slowly, it will still outperform Canada.
Interest rate differentials are an important element of currency movements. So, the Canadian dollar continue to be under pressure relative to the U.S. dollar, given the interest rate differential continuing to move in favour of the U.S.
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Eddy Farina, Fin. Pl., CIM
®
Senior Vice President, Investment Advisor 514.981.5727
" Wall Street makes its money on activity.
You make your money on inactivity. "
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