Market sentiment now indicates that rate cuts will not occur until the third quarter of 2024. Despite signs of strength, the direction of the economy and the likelihood of a recession remain uncertain. Relations between the U.S. and China are expected to remain strained regardless of the U.S. election outcome.
Dean is a single Canadian in his twenties looking forward to buying his first home. He’s planning to increase his home savings as his income grows over time. Dean’s advisor recommends a First Home Savings Account (FHSA) because it will give Dean up to 15 years to save, which suits his budget and time frame.
Monetary policy, global growth, politics and innovation have dominated headlines in 2024, and we expect these broad themes to continue to have an impact on markets as we head into the second half of the year.
Paul Holba, Senior Vice-President and CIO of Empire Life Investments Inc. discusses some of the key themes the investment team will monitor as we head into the second half of 2024.
Amina and Sanjay are a young Canadian couple looking forward to buying their first home. They both have satisfying jobs and are financially savvy. Through Amina’s grandfather they were introduced to an advisor who told them about the First Home Savings Account (FHSA), and they think it’s a good way to save for a home.
An index fund is an investment fund that aims to provide returns similar to those of market benchmark. This is generally done by investing in the same securities (or a representative sample) as the target benchmark.
Although it can be tempting to put your investment goals aside to chase these returns, beware of FOMO, which can introduce an unreasonable level of risk in your portfolio.
We maintain a positive view of fixed income as it appears rates have peaked, growth trajectories are slowing (making less risky assets relatively more appealing), and yields are starting the year at an attractive level. We believe this could cause the yield curve to re-steepen and lead to less inverted, or even positive, sloping curves.
As we begin the new year, we have a slightly negative outlook on Europe, slight optimism on China and a continued positive view of Japan.
Market Implications of the Conflict in the Middle East
Tensions in the Middle East have escalated following the attack on Israel on October 7th by Hamas militants from the neighbouring Gaza Strip. The incursion sparked international backlash, and Israel announced a complete siege of Gaza on October 9th. This conflict has led to a considerable death toll on both sides, a hostage crisis involving over 200 Israeli and international citizens and a growing humanitarian crisis in Gaza.
