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Hello everyone. Welcome to the weekly roundup. Today we will cover monetary policy, inflation, and market sentiment. Hello Ben. Hi Eva. Good to be back. Yes, couple of weeks. I missed you. Yeah, you've been riding solo. Yeah, exactly. Well, lots to cover today. Uh let's see how fast we could be. Um we're starting with monetary policy. Uh the hawks are circling and the market seems to be quietly pricing in the possibility of a hike. Um what are we expecting from the Feds and how should investors think about the impact of higher rates?

Yeah. [clears throat] So I think it's a great place to start and yeah I like obviously the headlines are uh are the part I think that's more scaring the market into the direction of the decision as opposed to listening to what the central banks are saying. Um but yeah, so the market is starting to price in rate hikes in Canada for sure and in the US there's still a possibility of a cut. I think there's a higher possibility than being priced in, but let's just start and stay with Canada first. Um so our current update at least from our economics team would have been this week talking about what they think will happen and right now still sitting with Q1 of next year. a 25 basis point increase and if we look at inflation data in Canada came in at 3.2% 2% uh annualized anyways which is a little bit higher and highest level in you know multiple years and months but I guess the the fear around inflation is are we going to have co inflation and we get up to 10 12 15% I'd say that's pretty near impossible um but of course anything's anything could happen um so in on Canada's perspective yes the market's pricing in hikes I'm not Sure. We still got quite a few quarters to cover before we get to that. Uh but that's why that's why you've seen yield start to move up. Okay.

And um PZ has said that um oh sorry PZ that that was our old central banker. [laughter] Um but the Becky Canada says that effectively that they're going to review it one day at a time kind of thing. So we'll see. Now if we look at WASH down in the US then you know he has always been vocal about cutting rates and so I would be surprised if we don't see a rate cut in the US but your point is right the market is not pricing that in right now and so that would be a surprise to the market and probably be a positive for bond prices and a positive for stock prices and so um those would be the things that I'd be certainly watching closely on that side of things. Okay. Yeah.

So, I read something interesting today that um even the opening of the street is not going to help the inflation situation and where the economy is now. Um what are your thoughts on the real impacts of geopolitics and you know even if everything dies down are we able to you know get through it and get back to where we were?

Uh, I don't think everything anything ever gets back to where it was, unfortunately. So, I think that's I think that's right. I think that there's probably that risk to continuing higher prices. And so, if you look at what Iran is requesting andor potentially getting is increased fees on pass through the straight. So, that's a definite loss to the world and uh a risk to higher prices. So I think it's something to be c cautious of and conscious of but the global economy is still pointing towards somewhat of a one handle on GDP growth this year. And so look at global GDP something around 1.6% expected this year. You know if the economy continues to slow getting closer and closer to zero. So I would say that the answer is yes there's some risk to it but if people stop shipping stop buying stop the consumer continues to be under pressure you know that's the flip side of it and technology is inherently deflationary I know nobody wants to talk about that but as technology speeds up that's going to cause further move towards deflation as opposed to inflation.

Yeah. Uh so on the equity side and my last question, tech has been doing much of the heavy lifting. Um but now that we're starting to see some names are pulling back, is this just a breather or is the market telling us to look for leadership somewhere else?

So it's a good question. I mean AI and the the big leaders Microsoft, Amazon, of course, Micron and the uh in the memory space like these things have gone up crazy. we saw the SpaceX IPO and so had lots of I'd say big big names coming under pressure to your point and so one of the things that I like to look at we like to look at is just really the breadth of the market and it's actually been expanding so as the market's potentially been treading water here the last little while there's been underlying stocks that are starting to pick up that were undervalued you get small cap value is the best performing we'll say asset class in the US so far this year. And so you've seen some of these undervalued names starting to pick up and the market's been treading water. So I mean I think it's an interesting thing that I'm spending some time thinking about is could we see the S&P close roughly where it is right now, the end of this year, but still see some stocks go up 20, 30, 40% that have been undervalued the last few years. And so I think that's how I'd be thinking about it. And so as we've had this kind of move on really this cap weighted market has been going up up and up. There's been a lot of stocks that have been left in the dust that have not moved in two years. So you know my thinking today would be around markets probably tread water for a bit but there's still opportunities to make money in individual stocks and stock picking and so that's where we'd be looking to to add value and best way we can.

Uh let's see the charts. Okay. So, we are recording this on uh Wednesday, June 24th around 100 p.m. So, anything that happens between now and next week, we'll comment on next week.

Let's just start off with this. There we go. So, I guess I did have that number right. Uh 2026. So, this is the world economic outlook. So, this came from our most recent report which came out yesterday just to give an update on forecasts. And I think again it's important to look at these numbers. So, advanced economy, we'll say GDP 1.6 and then world 2.9. And so I'd say on the advanced economy, so the US 2.1 to 2.3 to 2.1 is the expected forecast. Euro zone I think is an interesting com call out that I'll comment on in a minute. Canada 1.9 to.7 and then a jump from there. And so I would say Canada, this is obviously very important to us, but you know with a zero in front of the expected growth, we need to be pretty serious about what we do here. And so I'd say fiscal and monetary policy will be important to watch. That number ticks down a bit, then you probably see more talk of stimulus as opposed to tightening. And the Euro zone, they actually raised interest rates in Europe week and a half ago. And so that's a little surprising to me as their economy is stalling and slowing that they're raising rates. So they they're they're quite fearful of inflation. And so that that'll be something I think important to watch. Just from a market perspective, I think I'd be looking at where these countries expect to grow down in the bottom of this, which is in the emerging countries. We look at China probably sideways. India probably sideways as well. But then you have Mexico um that looks like it could pick up. So maybe there's an opportunity there because some of the stocks in the uh the market Mexico have kind of under come under pressure. So this could be an opportunity to look at uh what's next for an investment picture.

This hits a little bit with um my talk about the consumer. And so this one is the US the savings rate has sunk to a post-pandemic low. And so this just gives you a sense of the pressure that the US consumer is facing today. And so you have higher rates uh not only on the long end, which is their mortgage rates, but definitely on the short end as well. And so um the savings rate shrinking typically means the consumer is under pressure. The consumer is such a major part of the US economy that you don't want the US consumer under pressure if you want an expanding economy. And so this will be important chart to watch. But if you look at previous bottoms here um these numbers were at times where the US government started to get concerned as savings was going down which means people were spending more and more money to live on a daily basis.

And just two more quick ones. So this is the US and this is our discussion for rates. And so on the first one here, this is Fed funds. So they would be forecasting um the uh the current view is Fed funds is flat. And so if we look at into the future though, they do expect 50 basis points next year. So this is 375 to three and a quarter. Um the uh current market is at these levels. So if you look at the 3-month Treasury bill, this is more of a view of what the uh market is pricing in. So the market's actually starting to price price in potentially some cuts. And so if we look here where we are today, the market's starting to say maybe we do see rates come down. What I think is interesting when I look at this across this 30-year number, I think is very key because the 30-year is control. It controls the mortgage market in the US. And so, interestingly enough, it shows that this starts to creep up. Um, and this falls a bit in line with War's theory where you can shrink or or lower the front end and let the market control the longer end. So I think as a result of that the market's starting to price like uh some expectation that the he's not afraid to let the let the long end of the market creep up. Again this surprises me a bit because the US consumer cannot really handle higher rates at this point. So these numbers will be important to watch as uh as we progress from here.

So your question about Canada. So this is where we are today. This is Canada's numbers. So currently overnight 225 expecting Q1 of next year as I mentioned 25 basis points higher and by Q2 50 basis points and so this would be again contingent on um what happens to our economy from here. Um if we look at the uh the prime rates this is what the banks lend at. So that you see that creeping up and then if we look down in the bond market now Canadian bonds have been in much more demand and so we're almost a full 100 basis points well more than that 100 basis points uh more than Canada versus the US and so there's been a lot of money that has moved to the Canadian market. Um and we've seen the most amount of foreign investment that we've seen in a long time in Canada. some of that in Canadian dollars, some of that in US dollars. So there's institutions around the world that want to own US dollars but don't want to own US treasuries. So they've been buying what's called the Yankees, which are Canadian government denominated US dollar bonds. And so there's been a lot of demand. So this is a risk and opportunity, but this is why, you know, rates are significantly lower than where they are in the US at this time. I think it'll be important numbers to watch from here.

As always, the opinions expressed do not necessarily reflect those Nashmike Financial. I prepared this report with the best of my abilities. Should you have any questions about any of these things, please reach out to Ibra or I, and we're happy to discuss and see if anything is appropriate for you in your investment portfolio. Thank you, Ben. Welcome.

What's on the agenda for next week aides Canada Day? Yeah. So, so next week historically at least has been the tra the quietest trading days trading days and week of the year. So we got Canada Day on uh what is that? Wednesday. Yeah. So Canadian markets closed and then on what the Monday I guess is the Fourth of July holiday in the US. So I'd say the next five six trading sessions are going to be a little bit lighter. um good time to just think and reflect about what's going on. Maybe there's some settlement of some sort in the Middle East that can be uh looked at as as a positive. But I'd be looking at that. We've come kind of to the end of reporting. We had Micron report today with their financials. That's the big memory um AI play and they were decent. That stock's been extremely volatile. So, I'd still be looking at those numbers.

Um, yeah, I think that there's a lot to pay attention to still. The movement in oil and gas as well. We saw oil touch $76 a barrel this morning, which is uh a new short-term low. And so, let's see. The market's starting to say, okay, maybe we get return to normal a bit. And this that would be a big signal to that inflation risk that everyone's talking about. Um, so I'd be watching that right now. And as as usual, we make some adjustments in portfolios. We made small change there yesterday, trimmed some Intel and added Netflix for the first time ever. Um, so we'd be watching to see how the market's reacting to those adjustments we're making.

Okay, perfect. Thank you, Ben. Thank you, everyone. Remember to visit, subscribe, and follow us on YouTube and LinkedIn at Heart Investment Group. The link to our daily financial heartbeats will be in the caption of this video and in your email box if you're subscribed. For our clients, please reach out to me if you have any questions or if you'd like to book a review meeting with Ben. Thank you once again for listening and enjoy the rest of your week. Thanks everybody. Take care. Bye.

Hey everybody, Ben Hart here. It is Thursday, June 18th. Uh we're recording today. Just going to give you an update on what's going on in the world. So, anything that happens between now and next uh Thursday at this time, I'll giveyou an update on then. But let's start off with what's going on in the world today. Obviously, we're going into World Cup. So, lots going on in World Cup.

Lots of exciting games and countries rallying around each other, pointing in the right direction. It is quite a positive environment so far. It's gone off without a hitch, which is great. Uh Canada plays a big match this afternoon or 6:00 p.m. today uh win and they likely get on to the next round because they've gone to a round of 32 this time. Um so that should be interesting. Lot to watch and pay attention to there.

I think from a big picture economic perspective obviously most of the news and attention has gone around what's happening between Iran and the US and a temporary ceasefire to some sort. It looks like at least a 60 days. Um, Israel and Lebanon have been battling a bit which has caused some risk to the ceasefire. So that's making things happen a little bit on the jumpy side.

If you did read the daily today as well, I put out that some of the there were three Saudi super tankers with the 6 million barrels of oil starting to move through the straight today. So it looks like it is starting to open up. Will be interesting and watch and pay attention to the rest of the commodities starting to flow through there. Is that going to continue too? Um, so I think that's an interesting piece to watch. Obviously price at the pump's coming down, so I'm sure people are happy to see that. Um, but with the settlement or possible settlement, that's certainly taking the the the gas for lack of a better term, gas pedal off of the inflation number right now. And likely we're to see a bit of a reprieve there. Um, markets haven't interpreted too too much on it just yet. Um uh so we'll look at that as well.

Yesterday we had uh chairman WH's first meeting and so he spoke around what to do with interest rates in the US and they did nothing of course as expected.

You know I think an interesting view because he still has that expectation that you can lower frontend rates without touching the longer end and letting the longer end of the market control itself. Um, so we'll see. The bond market reacted in a bit of a strange way when when he spoke. Um, initially yields actually went up. Um, and then we'll we'll be interesting to see how that plays out from here. Gold as well got whacked coming out of that meeting and so gold was hit on the head a little bit uh from from there. And the US dollar has been on fire um and been rallying quite significantly actually upcane dollar year to date uh for the first time in a while. So, that'll be a key to watch to see how things progress from this point. So, I will uh kick us over to the charts. We can look through a few things and I'll give you a sense of what I expect and uh want to do um next week and a few of the things I've been looking at in trading this week.

All right, as I mentioned, this is June 18th, so recording this June 18th.

Um, all right, let's start off with this. Canada population retrenchment is reshaping the labor market. Yeah, I mean, I think that's a long-winded way to say a number of different things, but let's just say that we're looking at it from this perspective. Obviously, government target plan for end of the year 2027. So share of non-permanmanent residents in Canada population. So obviously there's been adjustments to the immigration policy open closed open closed and that of course has an impact on the labor and jobs market. So I thought this was an interesting chart to pay attention to. Unemployment rate by population segments was a 3-month moving average. So non-permanent residents have obviously come down that has a lot to do with the student changes to the student visa and policies immigrants. So this rallied up here and then has gone down and it looks like turning over a little bit. And then we'll say born in Canada.

What's h what's going on there is the jobs market is starting to uh to to change a little bit there. So unemployment rate by population interesting segment to look at to what's going on with our economy and we're what we're likely to see uh from from this point forward.

This is for the chart people. So technical analysis and gold. So I think these are the perfect two things to look at when uh people like to look at charts and such. Uh this is from our internal technical analysis team. Dennis Mark does this and puts out a view with what's going on. And so just if we look at the gold chart effectively you can see it said gold equities are starting to show technical deterioration. gold bugs, gold ratio chart is starting to test support and the risk breaking the risk is breaking the rising trend and so this is a pretty material number I think that we need to pay attention to. This is the Huey that everyone looks at. Um, and we've seen it take off from uh end of the year, early this year. Um, excuse me, from the previous year, so 24 um and now we're starting to see if there's an opportunity as to can it hold and do we start to pick up and reacelerate off these technical levels. When you're drawing these tren trend lines, obviously if you look at we've bounced, we've bounced and now we're hitting a material level because we had such a big run up and then b and now down to a support level and support's always uh very important to watch and pay attention to. If support holds, that's a good technical level and and uh signal that we want to say that this is potentially an opportunity that we'll look forward on.

It's great report. This is FIFA 2026 economic impact. You know, when all when these events happen, I'm always curious around what's the impact, what's 6 minutes, 23 seconds potential positive for the country and what the which these are which these events are happening. And this is a pretty good summary breakdown. So, this is US, Canada, and Mexico. So, US obviously is the major host. They're hosting 11 cities. Um, Boston, New Jersey, Atlanta, Kansas City. So all over the US, Los Angeles um and so they would have 78 matches projected economic impact based on the current data is about $30 billion and GDP contribution about half just over half of that. Um then if we look at Canada and Mexico, Canada, Toronto, Vancouver hosting 13 matches there. Mexico 13 matches in three host cities and pretty similar numbers at least in Canada projected 3 billion Canadian economic impact with a GDP contribution of about $2 billion. So still generally quite positive for hosting these type of events. Obviously a decent amount of time and money goes into preparing for them. Um and so I think you know these are these are some positive events certainly for North America going to have some that's going to have a bit of an impact on the jobs numbers that we'll have to pay attention to temporary jobs come in as they work as they work through the um uh World Cup. And so I thought this was an interesting cool breakdown just a sense of what does this mean to the individual countries and it's a generally a net positive to them based on that.

As always, the opinions in here do not necessarily express those of National Bank Financial. Anything we discuss and talk about today is unique and different for every individual's risk level.

Should you ever have any questions about anything we discuss, please reach out to Eva or I and we're happy to have a quick conversation discussion if any of the things are appropriate for you and potentially appropriate for your investment portfolio.

So that's it on the uh charts of the day today. Um just give you a sense of what's going on in uh markets andor rate land. And so if we look at the US markets, we're looking at the the US 10year at 440 and the US 30-year at 49.

So yields have come down in the last week or so. And if we look on the Canadian side, there's still a significant differential between the the US and Canadian numbers. So, US Canadian numbers are 3.37 on the 10 and 3.79. So, almost a just over a full 1% on the long end in in US versus Canada. And then on the 10 year, you're looking about 75 80 basis point differentials. So, that's interesting and worth watching. You know, when I've had the question around what's one of the things you want to watch and the US 10year rate is certainly one of those. as we start to creep up higher towards that 5% or so level that puts material risk on the economy and markets and so now we've been hovering around that you know 4.4 4.6 six levels for quite some time and the market's stabilized there. Um, so that I think is a piece that we'll want to continue to watch from a stock investment portfolio.

Number of things been looking at been looking at potentially taking some um gains off the table on Intel have done so already, but Intel had a positive announcement today that they are in some type of partnership with Apple. Uh, I think President Trump might actually announce that, but it was a positive news for for Intel and it's hit a new 52- week high today around 135. Well, from that, I'm looking for where and what do we do to reposition that. I'd say the two companies and stocks that we're looking at are Netflix and Palunteer. Um, those are the companies that have been beaten up a little bit over the last 52 weeks that could have that continue to have unique footprints and opportunities. uh at this point their stocks are down reasonable uh forward guidance looking in that in that space. So those would be two that we'd be looking to consider into portfolios.

And the last piece is what do we expect to happen next week? Obviously we continue to watch rates around the world, watch inflation. If the straight continues to stay open, I think we'll see those inflation expectations continue to come kind of come down. I yeah, I think Kevin Walsh this week was very important and key. He didn't do too too much in that first meeting, but my expectation is he's going to do quite a bit more in the upcoming meetings. And I when I say quite a bit more, uh it's more from the structural basis of how the decisions are done and made there at the Fed now versus my cutting rates and raising rates, all those sorts of things. you know, the odds of a rate increase actually went up this after this past meeting doesn't make a lot of sense because they continue to talk about rate cuts um in order to stimulate the economy. So, that'll be important as the world learns to deal with what and how he says things. The other thing that he's talked about is he doesn't like forward guidance. So, I'd expect probably at some point in the next meeting or two, we'd see that dot plot or that forward guidance start to dissipate and and move away and a little bit less information for the markets, which should provide maybe some some more opportunities as less information at times can give and level the playing field to some extent with us and institutional investors. And so, that that'll be important pieces to watch.

That's it for today. Thanks for listening to me. Thanks for joining us. Uh good luck to Canada 6 PM today.

Hopefully you're going to watch that. Um and as always, if you need a meeting, have any questions, you want to discuss anything we talked about today, please reach out to either or I happy to book a meeting, spend some time and answer the questions that may be appropriate for you. Thanks so much everyone. Have a great weekend.