Market Commentary: U.S. Tax Reform and Changes in the Canadian Market
PODCAST June 7, 2018
Today on The Wealth Exchange, Mark sits down to talk with Nicola Wealth’s Chief Investment Officer — Rob Edel — once again, to discuss his monthly market commentary.
This episode Mark and Rob talk about tax reform in the U.S., capital investments in the U.S., why the Canadian market outperformed the U.S. market this month, and equity evaluations. Rob also talks about his expectations of where he sees the U.S. dollar headed, his outlook on European markets and companies, and oil prices driving up Canada’s economy.
Today’s conversation is a fascinating one so tune in to find out more!
[:28] About today’s topics and guest.
[:52] In the month of April, Nicola experienced five intraday trading sessions with the clients in excess of 1% — one more than what they saw in the entire year, last year. What does that tell Rob?
[1:44] Why did Canada outperform the U.S. this month?
[2:46] Oil prices are driving up the Canadian economy — what is going on?
[5:12] Will prices for oil continue to go up in the short-medium term?
[6:45] Does Rob expect the U.S. dollar to continue to strengthen against other currencies?
[8:53] Nicola’s outlook on the Europe markets and companies short-term and long-term.
[10:38] The Wall Street Journal’s Market Data Group estimates an additional 28% growth would be required before trailing price to earnings multiple returns to its ten year average. Does Rob think they are saying that there’s that much room for growth to get back to its ten year average? Are we looking at undervalued stocks?
[12:41] Why might the U.S.’ recent tax reform want to incentivise people to put their money towards growing their business as opposed to paying back shares or dividends?
[14:57] What will be the indicators that the tax reform was successful in getting companies back to growing their businesses?
[15:53] What has changed within the last month and a half that has caused us to see a switch in the flat, long ten year bond rate.
[18:00] Because of the bond rate changing, does this change Rob’s outlook?
Mentioned in this Episode:
Rob is the Chief Investment Officer at Nicola Wealth Management.
Before joining the team at Nicola, Rob spent 9 years working for one of Canada’s largest money managers and — most recently — as a Portfolio Manager responsible for managing U.S. equities for the firm’s high net worth clients. Previous to that, he spent seven years working for the Treasury Department of a Major Canadian Chartered Bank, splitting his time between Vancouver and Toronto. Rob has completed his CFA and is a member of the Association for Investment Management and Research (AIMR).
About Your Host — Mark Therriault
Mark is the Financial Advisor and partner of Nicola Wealth Management — and your host for The Wealth Management podcast.
As a member of the NWM Planning Team since 2006, Mark has become his clients’ trusted advisor. He prides himself on providing an exceptional experience to his clients while quarterbacking their financial affairs.
Mark earned his Bachelor’s degree in Economics with a minor in Finance from the University of Calgary. He went on to secure his CFP designation and also completed the CIM, CSC, the B.C. Life Insurance License.
This presentation contains the current opinions of the presenter and such opinions are subject to change without notice. This material is distributed for informational purposes only and is not intended to provide legal, accounting, tax or specific investment advice. Please speak to your NWM Advisor regarding your unique situation. Forecasts, estimates, and certain information contained herein are based upon proprietary research and should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. NWM fund returns are quoted net of fund-level expenses. Past performance is not indicative of future results. All investments contain risk and may gain or lose value. Projected returns are estimates only. Returns are not guaranteed. Nicola Wealth is registered as a Portfolio Manager, Exempt Market Dealer and Investment Fund Manager with the required provincial securities’ commissions in Canada.