JMRD Market Observer for November 25th, 2016 – JMRD – Southwest Ontario Team of the Year

November 25, 2016

In This Week’s JMRD Market Observer Market

 

 

  • JMRD – Southwest Ontario Team of the Year

  • JMRD in New York

  • NBFM Monthly Equity Monitor – December 2016

  • NBFM Monthly Fixed Income Monitor – December 2016

  • Retirement Corner

  • Reads of the Week

  • Economic Calendar

  • Earnings Reports

 

 

JMRD – Southwest Ontario Team of the Year

 

Awards of Excellence

 

Each year National Bank Financial recognizes those exceptional Investment Advisors and their teams through our Recognition of Excellence Awards.  This year, I’m proud to announce that the JRMD Wealth Management Team has been selected as the Team of the Year for the Southwest Ontario Region.  

 

The Team of the Year award is presented to teams who demonstrate excellence in all aspects of their business.  These Advisors produce superior results in the quality of their investment and portfolio management as well as involvement both within National Bank Financial and their community. They must also adhere to our strict ethical standards and continuously exceed them.

 

The JMRD Team continue to redefine the client experience and strive daily to improve their approach to Wealth Management.  Well respected within the firm and the industry as a whole, JMRD’s commitment to excellence is evidenced through their consistent and disciplined delivery of investment and financial advice for clients. 

 

I’m proud to represent a firm who hosts a team of the calibre of JMRD Wealth Management.  Year after year they set a new standard for other teams to strive for and for years now have maintained a reputation based on integrity and excellence.  I’m also proud to say that they are my Investment Advisors!

 

 

Congratulations to the JMRD Team and their award of Team of the Year!

 

Sincerely,

 

Vice-President

Regional Manager

 

 

JMRD In New York

 

It has been a very busy month of travelling for JMRD as you all know from reading the ‘Market Observer’ over the past month.  Well, this past week has been no different with Paul and Reg travelling to New York City for NBF’s annual President’s Club.  This is an excellent opportunity to catch up with friends and colleagues while hearing from National Bank and National Bank Financial brass. 

 

Landing in Newark for the first time was quite interesting as it provides an opportunity to take a different route into NYC.  It is rather exciting seeing the City from the outside, taking the tunnel and boom, you are in the heart of the Big Apple!  

 

Of course, the talk of the town continues to be all things about President-elect Donald J. Trump.  With Trump Tower a short walk from the hotel, it is hard to get away from the chatter.  And yes, there are still protesters but it is getting colder so we’ll see how long they last. 

 

Now, onto a few things of interest.

 

Rothschild & Co.

 

Our first meeting was with a small group of advisors visiting Rothschild & Co at their head office.  Rothschild has been at the centre of the world’s financial markets for more than 200 years.  The company provides a unique global perspective that makes a meaningful difference to large institutions, families, individuals and governments every day.

 

We spent well over an hour discussing global financial markets and current events.  The main takeaway here is that there is a great sense of change and uncertainty.  A long list of questions can be asked from Brexit to OPEC to Trump to interest rates.  As is often said, it is a bull market for ‘opinions’ but there is little consensus on the main issues of today. 

 

NBF has an exclusive distribution arrangement with Rothschild which also means that JMRD has access to one of the world’s premier money managers.  Expect to see and hear more about this company as we really like this story.  

 

A final note is that Rothschild is a perfect candidate for inclusion in one or more of the JMRD model portfolios – more to come! 

 

Goldman Sachs Asset Management

 

Our final meeting was with GSAM, yet another renowned money manager with which NBF has an exclusive arrangement.  GSAM stands for Goldman Sachs Asset Management and this firm is certainly one of the best known financial firms on the planet.   

 

We were lucky enough to have two presentations from Goldman. The first discussion focused on income alternatives in a low interest rate world while the second presentation was more focused on market volatility and risk management.

 

We sum up the main take-aways as the following:

 

  • Rates will remain low for the foreseeable future
  • However, they will be rising slowly which will be negative for bonds
  • Expect returns to be lower in the future / manage expectations accordingly
  • Focus on quality companies with a history of rising dividends

 

To wrap up, GSAM is the manager of the ‘National Bank Strategic U.S Income and Growth Fund’.  JMRD has been using this mandate since it was launched at NBF and will continue to do so.  Expect to see GSAM in our model portfolios as well.  

 

 

NBFM Monthly Equity Monitor – December 2016

 

Highlights

  • On the surface, global equity markets seem to be reacting well to the S. election, with the MSCI AC regaining most of the ground it lost immediately after November 8. But the rebound has been anything but broad-based. While U.S. equities are at or near records, unease persists in emerging markets and Europe.

 

  • Republican control of both houses puts Trump in a fairly good position to advance other parts of his pro-growth agenda, including tax cuts for corporations and individuals and reduced environmental and business regulation. In our outlook, however, the U.S. economy is unlikely to get a boost from President Trump’s agenda before the second half of 2017 at the earliest.

 

  • In the meantime, the S. stock market still needs to reconcile aggressive earnings expectations with a super-strong dollar that amounts to a drag on the top-line growth of U.S. multinationals (chart).

 

  • The S&P/TSX has so far held its ground in the post-election tumult, but mostly because of its two largest sectors, Financials and The bottom-up consensus of equity analysts currently sees earnings growth more than twice that of the U.S. over the coming 12 months (22.6% vs. 10.8%).

 

  • At this juncture, until we get to know the actors a little better, we prefer to keep our asset mix unchanged with an above-average weighting in We see little upside in equities through the end of the year as markets adjust to the Federal Reserve, the composition of the new U.S. Congress and political events in Europe. 

 

See attached report for more details

 

Equity Monitor

 

 

NBFM Monthly Fixed Income Monitor – December 2016

 

Highlights

 

  • Market expectations for monetary policy have become more hawkish in the wake of the US presidential election. If, on net, pro-growth policies are put in place, GDP in 2018 is likely to be stronger than we were projecting only a month ago. But of course the view down the road to December 2018 is rife with potential bumps. With so much still unknown about what the new administration will end up proposing, the uncertainty around our projection is rather large at this point. With this caveat, our base case scenario projects a 2.0% higher bound for the fed funds target range by Q4 2018 and 10-year Treasuries trading around 2.70% at year-end 2017 and heading toward 2.95% by year end 2018.

 

  • In our view, the Bank of Canada can easily stand pat in 2017, but international developments will create unwelcome pressures in 2018. We see two BoC rate hikes in 2018. 

 

See attached report for more details

 

Fixed Income Monitor

 

 

Retirement Corner

 

 

 

 

Reads of the Week

 

 

 

 

 

 

 

 

 

 

 

Economic Reports

 

Monday November 28th – None

Tuesday November 29th – US GDP, US S&P/Case-Shiller Home Price Index, US Consumer Confidence

Wednesday November 30th – Canada GDP; US Personal Income, US Chicago ISM, US Pending Home Sales, US Beige Book

Thursday December 1st – Canada Manufacturing PMI; US Initial Jobless Claims, US Manufacturing ISM,

Friday December 2nd – Canada and US Employment Change and Unemployment Rate

 

 

Earnings Reports

 

Monday November 28th – Lonestar West Inc.

Tuesday November 29th – Bank of Nova Scotia

Wednesday November 30th – Royal Bank

Thursday December 1st – CIBC, Canadian Western Bank, TD Bank, PWC Capital

Friday December 2ndNational Bank

 

 

Have a good weekend.

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