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Financial markets at a glance - March 31, 2022

Investment Views, Investments

Posted by Empire Life Investments

May 12, 2022 5:14:16 PM

Empire Life Investments
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2021-Budget-infographic-ELSymbol
FINANCIAL MARKETS
AT A GLANCE

 

MARCH 31, 2022

Canadian equities were mixed, while U.S equities were mostly negative. We saw a steepening of the yield curve. As a result, corporate bonds outperformed government bonds, and subsequently shorter term bonds outperformed long term bonds. Here are the financial markets at a glance.

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CANADIAN EQUITIES
 
US EQUITIES
 
 
Sector
7 of the 11 Canadian equity sectors ended the quarter in positive territory. Here are the best and worst performing sectors relative to last quarter.
 
Sector
2 of the 11 U.S. equity sectors ended the quarter in positive territory. Here are the best and worst performing sectors relative to last quarter.
 
WORST PERFORMERS
BEST PERFORMERS

Energy

Energy
 

Materials

Materials

Communication Services

Communications
Services
37.2% Up arrow
20.1% Up arrow
9.3% Up arrow

Information Technology

Information
Technology

Consumer Discretionary-nobg-sm

Consumer Discretionary

Healthcare

Healthcare
-20.6% Down arrow
-7.6% Down arrow
-5.5% Up arrow
 

Energy

Energy

Utilities

Utilities
37.5% Up arrow
3.6% Down arrow

Communication Services

Communications
Services
Consumer Discretionary-nobg-sm
Consumer
Discretionary
-12.9% Down arrow
-10.0% Down arrow
 
 
Company size performance comparison 
Though medium and large companies were
positive over the quarter, they underperformed small-sized companies.
 
Company size performance comparison 
Small, medium and large companies were
negative over the quarter, with small companies underperforming the most.
 
 
Small Business  Up arrow
Medium BusinessLarge Corporations Up arrow

Small
Companies

Medium & Large 
Companies
 
Small Business  Down arrow
Medium BusinessLarge Corporations Down arrow

Small
Companies

Medium & Large
Companies
 
 
What’s working/What’s not working
  • From a style perspective, value was positive but growth was negative and underperformed the index.
  • Momentum and dividends were the top performing factors this quarter, while quality trailed all other factors.
 
What’s working/What’s not working
  • Value and growth were both negative this quarter, but growth underperformed the index.
  • All factors were negative this quarter, but dividends and low volatility outperformed the index.
 

 

 
GLOBAL EQUITIES
 
FIXED INCOME
 
 
 
Regional 
 
Global Equities-EN
Company size performance comparison 
Global small and large companies were
negative over the quarter with small companies underperforming the most.
Small Business Down arrow Large Corporations Down arrow
Small Companies Large Companies

What’s working/What’s not working
  • From a style perspective, value outperformed growth and the MSCI World Index. However, both ended the quarter in negative territory.
  • Dividends and low volatility were the factors that outperformed the index, but all factors and the index were negative.
 
We saw a steepening of the yield curve this quarter, with yields in the short, middle and long end moving higher as interest rates and inflation rose. 
Bond performance 
Long-term Bonds Down arrow Short-term Bonds Up arrow
Long-term Bonds Short-term Bonds
Government Down arrow Corporate Up arrow
Government Corporate
 
   Bond yield 
Bond Yield image@2x

 



Bond yields were up with both shorter and longer date bond yields increasing over the quarter.
Yield on the Canada 2-year rose from 0.95% to 2.27%.
Canada 5-year rose from 1.25% to 2.39%.
Canada 10-year rose from 1.42% to 2.40%.
Canada long bond rose from 1.68% to 2.37%.
 
     
     
     
     
     

 


Source: Morningstar Research Inc. as of March 31, 2022. © 2022 Morningstar Research Inc. All rights reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete, or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results. 

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This article includes forward-looking information that is based on the opinions and views of Empire Life as of the date stated and is subject to change without notice. The information contained herein is for general purposes only and is not intended to be comprehensive investment advice. We strongly recommend that investors seek professional advice prior to making any investment decisions. Empire Life and its affiliates assume no responsibility for any reliance on or misuse or omissions of the information contained herein.

 

March 2022

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