IAIC Market Update - March 29, 2021

(source: Bloomberg https://www.bloomberg.com/markets, MSCI https://www.msci.com/end-of-day-data-search and ARG Inc. analysis)

What happened last week?

• It was a mixed week for North American equities as the TSX and NASDAQ lost ground while the S&P 500 and the Dow moved ahead. 
• The primary driver of equity values continues to be the progress against the pandemic, both domestically and globally. Restrictions in Europe are being reimposed as case rates have begun to climb, which is a trend that is also reappearing in Canada and the U.S. 
• The major equities indices have logged strong gains for the first 12 weeks of 2021. The NASDAQ lags the field at 2% for the year while the Dow leads with slightly more than 8% gains. 
• Stimulus cheques began to arrive for American families and are expected to increase consumer spending in the short term. For longer-term economic stimulus, a proposed infrastructure bill has been introduced by the Biden administration. Both measures are designed to spur economic recovery.
• In Canada the Federal and Provincial government fiscal measures and Bank of Canada monetary policy moves have been generally successful. Fortunately for families and the most vulnerable, foreclosures and evictions have not risen as quickly as employment and business closures, but it has been very difficult for many. Like many businesses, governments and our central bank were forced to conduct operations virtually and imagine, design, and implement solutions in record time. A recap of some of the activity can be found here, it serves as a reminder of the challenges and solutions, as well as the timing and sequencing of them.

What’s ahead for this week?

• In Canada, the most significant economic release will be January’s Gross Domestic Product numbers which measures Canada’s overall output. The pace of its growth will indicate how well we are recovering during the pandemic. Also, the TSX will be closed on Friday.
• In the U.S., markets will be closed on Friday and economic releases will be lighter than usual during the short week. February’s construction spending, along with March’s Purchasing Manager’s Index (PMI) from both ISM and Markit are on the calendar.