Tuesday, 10/6/2026 p.m.

• Stocks trade higher amid lower oil and stable bond yields – North American equity markets traded higher on Tuesday, with stability in bond markets supporting stocks. The TSX logged a 0.3% gain for the day while the S&P 500 rose by 0.6%. Overseas, markets in Asia were mostly higher overnight, while European markets traded higher as well. On the economic front, ADP weekly payroll data showed that U.S. private employers added an average of 23,750 jobs over the past four weeks, the highest since June. In bond markets, the 10-year GoC yield fell to 3.92% while the 10-year U.S. Treasury yield declined to 5.28%. Oil prices finished the day near the flatline with WTI crude closing at just below $90 per barrel.
   
• U.S. midterm elections and implications for investors – U.S. Midterm Election Day is just under one month away, providing an opportunity to review how markets have historically performed around midterm elections. For the full year, equity returns have historically been modest during midterm election years. Since 1970, the S&P 500 has generated an average total return of 3.6% during midterm election years, compared to an average annual return of 12.5% across all years from 1970–2025.* The two most recent midterm years were particularly challenging for stocks, with the index declining 18.1% in 2022 and 4.4% in 2018.* Stocks have bucked that historical pattern in 2026, however, with the TSX and S&P 500 up roughly 14% year to date including dividends, through yesterday's close. As we highlighted in our recent Market Pulse, the period surrounding midterm elections has historically been favourable for equity markets. During the month leading up to Election Day, the TSX and S&P 500 have gained an average of 2.8% and 4.5%, respectively, with positive returns 60% and 78.6% of the time.* Over the subsequent six months, the indexes have generated average returns of 11% and 15.5%, respectively, with the S&P 500 advancing after every midterm election since 1970 and the TSX doing so since 1986.* While there is no guarantee that history will repeat itself this election cycle, we believe these results help reinforce the importance of maintaining a disciplined investment strategy and resisting the temptation to play politics with your portfolio.
   
• Key labour market data in focus – Domestic labour-market trends will be in focus on Friday with the release of the September Labour Force Survey. Economists expect employment to have risen by 15,000 during the month, while the unemployment rate is expected to tick higher to 6.5%. After a resurgence in hiring from April through July, employment fell by nearly 42,000 in August. More timely indicators suggest that hiring remained tepid in September. The Canadian Federation of Independent Business’s net staffing intentions index fell to -3, indicating that more small businesses planned to reduce staffing than add workers. Elevated borrowing and energy costs, along with trade-policy uncertainty, could weigh on business hiring and investment intentions over the coming months. However, we view these pressures as creating a meaningful but manageable headwind for the Canadian economy.

Brock Weimer, CFA
Investment Strategy

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