• Stocks end mixed as tech rotation continues - Following yesterday’s tech-driven decline of more than 1% in major indices, investor sentiment stabilized today, but the weakness in semiconductors persisted. The TSX and S&P 500 finished lower, but the Dow ended higher, supported by lower oil prices and easing bond yields. WTI crude fell more than 4%, trading near $70 per barrel, the lowest level since early March. Progress toward reopening the Strait of Hormuz is helping ease concerns about supply disruptions and is beginning to bring relief at the pump, although the U.S. administration has directed the Department of Justice to review gasoline prices, arguing they have not declined enough. Moderating inflation expectations are also relieving pressure on rates, with the 10-year Government of Canada yield falling to 3.37%. The Nasdaq underperformed as investors await Micron’s earnings after the close, which will refocus attention on AI spending and the elevated expectations surrounding it. In corporate news, Alphabet is set to replace Verizon Communications in the Dow, effective before the market opens on June 29, 2026.
   
• Falling oil prices help provide consumer and central bank relief - Oil prices are extending their decline today, with WTI crude trading near $70 per barrel, the lowest level since the start of the Middle East conflict. Following the signing of the Iran agreement, the Strait of Hormuz is reopening, boosting supply. The EIA reported last night that UAE exports have recovered to nearly 85% of pre-war levels. At current prices, oil has retraced almost all of its March and April gains, offering relief at the pump for consumers ahead of the summer driving season. The Fed’s preferred inflation measure, core personal consumption expenditures (core PCE), is due tomorrow and is expected to edge up to 3.4% from 3.3% in May, marking the highest reading since October 2023 and reinforcing the Fed’s hawkish tilt. However, if oil prices remain contained, May likely marked the peak in headline inflation. This would provide the Fed and BoC with some breathing room to maintain a prolonged pause, in our view.
   
• First-half performance check - With just a handful of trading days left in the quarter and the first half of the year, equities remain on solid footing, with several indices near all-time highs, including the TSX, the Dow and the Russell 2000, a proxy for U.S. small-caps. While geopolitical uncertainty drove a near-correction earlier in the year, recent de-escalation has helped lift sentiment. The TSX and S&P 500 are up about 10%, supported by strong corporate earnings, even as valuations have modestly compressed since the start of the year. In contrast, investment-grade bonds are flat and have underperformed cash, as persistent inflation and uncertainty around central bank policy have pushed yields higher. Despite continued market concentration, diversification has added value so far this year, with emerging markets (+30%), U.S. small-caps (+24%), and mid-caps (+18%) all contributing to portfolio returns. After a strong run in technology, leadership is beginning to broaden and market swings are increasing. In our view, markets are transitioning from narrow to broader leadership, from suppressed to more normalized volatility, and from momentum-driven gains to a more balanced environment. This likely implies some near-term choppiness. However, with the economy remaining resilient and earnings growth still robust, we believe pullbacks should be viewed as corrective rather than trend-ending.

Angelo Kourkafas, CFA;
Investment Strategy

^{Source for all data: Bloomberg.}

• Stocks waver on tech weakness – North American equity markets closed lower Tuesday, with the S&P 500 and Nasdaq falling 1.4% and 2.2%, respectively, as weakness in technology shares weighed on sentiment. The TSX, which has less exposure to tech, held up better, declining by roughly 0.3%. Within the technology sector, semiconductors were the clear laggard, with the S&P 500 semiconductor industry down roughly 6% on the day. Overseas, tech-related weakness was even more pronounced overnight, highlighted by a 10% decline in South Korea’s KOSPI Index, which also has heavy semiconductor exposure. In our view, today’s pullback likely reflects profit-taking following the sharp rally from the March lows, with the S&P 500 up more than 15% and the Nasdaq up more than 20% since March 30. Bond yields were little changed, with the 10-year Government of Canada yield closing around 3.44% and the 10-year Treasury yield at 4.5%. In commodities, oil prices continued to trend lower, with WTI crude closing near $73 per barrel.
   
• Tech pullback sparks volatility – Weakness in technology shares weighed on global markets Tuesday, with equities in Canada and the U.S. closing lower and the tech-heavy Nasdaq underperforming. Overseas technology stocks were also under pressure overnight, with South Korea’s KOSPI Index declining by 10%. With no clear catalyst driving the move lower, we believe today’s pullback likely reflects profit-taking following a strong rally from the March lows. Taking a step back, the Nasdaq had gained 26% from March 30 through yesterday’s close, while the PHLX Semiconductor Index had advanced more than 100% over the same period. Viewed through this lens, a period of consolidation is reasonable, in our view, after such a sharp move higher. Looking ahead, we believe the broader market remains supported by solid fundamentals. The TSX and S&P 500 are on pace to grow earnings by more than 20% this year, while economic activity has remained resilient, particularly in the U.S. We continue to recommend an overweight to equities as part of our opportunistic asset allocation guidance. However, we believe diversification remains key to managing risk, particularly after the strong gains in technology and other growth-oriented segments of the market. To view our full suite of portfolio guidance, check out our Monthly Portfolio Brief.
   
• First half of July has historically been favourable for stock returns – While we ultimately believe fundamentals and economic conditions drive markets — not the calendar — history suggests July has tended to be a favourable month for equities. Since 1980, the S&P 500 has posted an average return of 1.3% in July, compared with an average monthly return of 0.9% over the same period.* What’s more, the first half of July has historically been particularly strong.* Since 1980, the S&P 500 has gained an average of 1% from July 1 through July 15, with returns positive 68% of the time.* By comparison, the second half of the month has delivered an average return of 0.2%, with positive returns 55% of the time.* Of course, there is no guarantee that history will repeat itself this year. Still, when combined with what we view as a solid fundamental backdrop — supported by healthy economic activity and strong earnings growth — we believe the environment for equity markets remains positive.

Brock Weimer, CFA;
Investment Strategy

^{Source for all data not cited: FactSet. 
Source for data cited: *FactSet, Edward Jones.} 

• Equities mixed at the start of the week – Sharp declines in technology stocks helped push the Nasdaq index 1.3% lower over the session and weighed on the S&P 500 index too. This continues the bumpy ride in AI stocks in recent weeks, but performance in other parts of the market was better, hinting at a potential rotation in market leadership, in our view. The Dow Jones Index moved higher to approach record highs, while the small-cap Russell 2000 index broke new ground, hitting a record close after a 0.8% gain today. In single stock news, SpaceX was down more than 10% following news of its plan to issue significant debt to finance AI investment. Otherwise, U.S. government bonds continued to struggle after last week's hawkish Fed meeting, with the 2-year U.S. Treasury note hitting a new 2026 high of 4.23% and longer-dated bonds selling off too. Canadian bonds were also weaker, but the moves in yields were more contained. Finally, higher U.S. interest rates continue to support the U.S. dollar, which is trading at a 2026 high against the Canadian dollar.
   
• Iran peace talks start in earnest – Newswires are reporting "major progress" between the U.S. and Iran as they kick start peace talks to address the issues unresolved in last week's interim two-month agreement. Headlines over the weekend highlighted ongoing tensions in the region, with Iran threatening to walk away from discussions in the face of Isreal's war in Lebanon, while President Trump warned of renewed military action. Hurdles to a durable peace agreement remain, but for the time being we are seeing tanker traffic through the reopened Strait of Hormuz pick up, even if this remains well below pre-war levels. Oil markets are trading lower today, with WTI oil at $75 per barrel, with the drop in crude prices, if sustained, to provide some helpful disinflationary relief for households in coming months, in our view.
   
• A peak in Canadian inflation? In our view, the prospect of lower oil and gas prices should mean that the spike in the Canadian consumer price index (CPI) over May reported this morning might well represent the peak of the 2026 price spike. Headline inflation hit 3.2% year-over-year, a stronger-than-expected reading, according to the Bloomberg consensus. However, this surge largely reflected rising energy and food prices, and excluding these, the core CPI measure is running at a more moderate 1.6%. Consistent with this picture of more moderate underlying inflation trends, the Bank of Canada's median and trimmed mean measures of inflation remain close to 2%. We think these data should help provide reassurance that inflation pressures are contained in the energy sector and encourage the Bank of Canada to leave interest rates on hold at 2% as it looks to cushion the economy in the face of trade policy uncertainty.

James McCann;
Investment Strategy

^{Source for all data: Bloomberg, FactSet}

There was no Daily Snapshot on Friday, June 19, 2026, in observance of the Juneteenth holiday.

• Equities rally on Middle East peace agreement – U.S. stocks rebounded at the close a holiday shortened week after U.S. President Trump signed an interim peace deal with Iran, paving the way for a reopening of the Strait of Hormuz. The S&P 500 jumped 1.2% over the session, reversing much of yesterday's slide after a more hawkish than expected FOMC meeting, with the Nasdaq even stronger on news that Intel has struck a chipmaking deal with Apple. Despite a positive tone in markets, and WTI trading around recent lows of $77 per barrel, the front end of the U.S. government debt market remained under pressure. Yields on the 2-year Treasury note traded at 4.18%, just a shade off yesterday's 2026 high. However, longer-dated debt continues to perform better, with the 10-year Treasury yield rallying to 4.45%, with the Canadian equivalent moving down to 3.38%, a three-month low. Finally, the shift higher in short-term U.S. rates markets continues to support the U.S. dollar, with this moving to a new 2026 high against a trade-weighted basket of currencies.
   
• Initial claims point to steady labour market – This morning's U.S. initial unemployment insurance claims data were broadly stable at low levels, with this closely followed measure of labour-market health telling us that firms are not cutting back on staff in concerning numbers at present. In our view, this solid labour-market backdrop helps explain yesterday's hawkish shift from the Fed. In the March Summary of Economic Projections, FOMC members were overwhelmingly warning that risks were tilted towards rising unemployment. At yesterday's meeting the signal was that risks in the labour market were broadly balanced. Meanwhile, almost every member continues to see risks to their inflation forecasts as tilted to the upside. This shift in the risk distribution helps explain why around half of the committee thought that an interest-rate hike this year might be needed. In Canada, more subdued labour-market trends help explain why the Bank of Canada has sounded more cautious around potential rate hikes this year.
   
• Lower incoming inflation? The good news for central banks, in our view, is that some relief from inflation pressures is likely coming over the summer. Average U.S. national gasoline prices fell below $4 a gallon yesterday and should fall further in coming weeks if oil continues to trade in the $70-$80 per barrel range. This should likely quickly feed through to softer headline inflation readings. This trend will not be captured in next week's U.S. May PCE inflation report (or Canada's May CPI data), which looks set to show another strong gain in price growth. However, we should see softer inflation in June CPI and PCE reports released around the middle of July in the U.S. and Canadian June CPI data too. Otherwise on the U.S. data calendar next week, we will get a first look at business investment in May in the durable goods reports, consumer spending trends in the May personal income and spending data, and a more timely read on business sentiment in June PMI figures. Finally, we will be watching out for FOMC members commentary to better understand motivations for the hawkish shift at yesterday's meeting, especially given the more pared back guidance presented by Chair Warsh at the press conference.

James McCann;
Investment Strategy

^{Source for all data: Bloomberg, FactSet}