• Markets close mixed with central banks, Magnificent 7 on deck – The TSX edged lower, while U.S. equity markets advanced on Monday as investors look ahead to the Bank of Canada's and Fed's April meetings and earnings results of five of the Magnificent 7 companies this week. Sector performance was mixed, with communication and financials leading gains, while consumer staples and real estate lagged. Bond yields rose, with the 10-year Government of Canada yield at 3.50% and the 10-year U.S. Treasury yield at 4.33%. Internationally, Asian markets were mostly stronger overnight with both Japan's Nikkei and South Korea's KOSPI indexes reaching record highs. In energy markets, WTI oil prices traded higher amid uncertainty around U.S.-Iran diplomacy and continued disruptions in the Strait of Hormuz. Meanwhile, the U.S. dollar softened against major currencies.
   
• Bank of Canada, Fed likely to remain on hold this week – The Bank of Canada (BoC) and Fed begin their April meetings on Tuesday this week. Market expectations point to BoC holding its policy rate steady at 2.25% and the Fed maintaining the target range for the federal funds rate at 3.50%-3.75%. The larger focus is likely to be on the statement and commentary, specifically the extent to which both central banks are willing to look through the near-term impact of higher oil prices on inflation. Canada CPI was running at 2.4% through March, while core measures were slightly lower at 2.2%-2.3%, slightly above the 2% target. The Fed's preferred Personal Consumption Expenditure (PCE) inflation gauge for March will be released on Thursday, with forecasts calling for a rise to 3.6%, from 2.8% the prior month. With inflation well above the 2% target, the Fed will likely be on the sidelines in the near term. We believe the stabilizing U.S. labour market, showing some signs of strengthening, should give policymakers time to look for signs that inflation is temporary.
   
• Earnings season set to hit its stride with Magnificent 7 – Five of the Magnificent 7 companies are on the earnings calendar this week, starting with Alphabet (Google), Amazon, Meta (Facebook) and Microsoft on Wednesday, followed by Apple on Thursday. More broadly, the early read on first-quarter earnings has been encouraging: With about 28% of S&P 500 companies reporting, 82% have beaten EPS estimates by an average upside surprise of 12%. EPS growth estimates have been revised up to 13.7%, from 12.1% at the end of the quarter. If achieved, this would mark the sixth straight quarter of double-digit earnings growth. Technology is again expected to lead by a wide margin, with earnings gains of more than 40% year-over-year, followed by materials and financials. Importantly, the breadth of growth is expected to be strong, as eight of the 11 sectors are projected to post year-over-year EPS gains. We believe wide earnings growth should help support more balanced market performance across sectors and help strengthen the case for portfolio diversification.

Brian Therien, CFA ;
Investment Strategy

^{Source for all data: FactSet} 

• Stocks mostly rise on peace hopes and tech outperformance – While the TSX was little changed, the S&P 500 and Nasdaq hit fresh record highs today after encouraging signs that the U.S. and Iran may return to the negotiating table for peace talks. The recent rally in oil prices, with WTI up 13% this week, paused following news that the Israel Lebanon ceasefire has been extended for three weeks, and that Iran’s foreign minister is expected to travel to Pakistan for a second round of negotiations. In Canada, retail sales rose 0.7% in February, slightly softer than expected, but the prior month sales were revised higher and gains were broad-based. Elsewhere, U.S. technology stocks led the gains, with semiconductors outperforming after Intel issued an upbeat outlook. Intel shares surged 23% to a new record high after the company delivered a sales forecast that significantly exceeded expectations. In Asia, Taiwan Semiconductor Manufacturing jumped 5% after regulators eased limits on single stock fund holdings. Meanwhile, bond and currency markets remained relatively quiet as investors look ahead to central-bank meetings next week.
   
• Depressed sentiment vs. still-solid fundamentals - Sentiment surveys, such as the University of Michigan consumer sentiment index, have fallen to their lowest levels on record, below those seen during both the 2008 financial crisis and the 2020 pandemic. Yet the hard economic data do not appear to reflect this degree of pessimism. Retail sales have remained resilient, highlighting a significant divergence between how consumers feel and how they behave. While technology-sector layoffs have attracted attention, labour-market indicators remain encouraging. Weekly initial jobless claims continue to run near historical lows, unemployment is steady, and private‑sector hiring appears to be regaining momentum. In Canada, the government's recently announced plan to suspend the federal gasoline tax until September 7 will provide a modest boost to household incomes. In the U.S., higher energy prices remain a headwind for households, but increased tax refunds stemming from the new tax bill are providing a meaningful offset. According to the latest IRS data, the average refund this year is approximately $3,400—an 11% increase from last year. Overall, we expect household stimulus to reach roughly $200 billion in 2026, more than offsetting an estimated $80–$100 billion increase in gasoline and other fuel spending driven by higher oil prices.
   
• Earnings strength is key behind market's resilience - While investor sentiment can change on a whim, trends in corporate profits are among the most durable drivers of market performance. We believe strong earnings growth is a key reason markets have become less sensitive to geopolitical headlines and swings in oil prices. TSX and S&P 500 earnings are expected to grow 21% and 14%, respectively, year-over-year in the first quarter. If realized, this would mark the strongest growth for the TSX since 2021 and the sixth consecutive quarter of double‑digit earnings growth in the U.S. The technology sector is leading the charge, with earnings projected to rise roughly 46%, driven by robust demand for artificial intelligence and the related infrastructure buildout. Other sectors are also expected to deliver solid growth, but markets will remain focused on mega‑cap technology next week. Microsoft, Amazon, Alphabet, and Meta are all set to report after the close on April 29, followed by Apple on April 30.

Angelo Kourkafas, CFA ;
Investment Strategy

^{Source for all data: Bloomberg.} 

• Markets take a breather after reaching all-time highs – Equity markets in the U.S. and Canada were modestly lower on Thursday after the S&P 500 and Nasdaq notched new closing highs on Wednesday. The technology-heavy Nasdaq lagged the broader S&P 500 and Canadian TSX. Nonetheless, for the full year, major indexes are higher, with the S&P up about 4% and the Canadian TSX up over 7% this year so far. On a sector basis, energy and materials have led the way higher in 2026 in the U.S. and Canada, up over 10%, while financials and health care have lagged in the U.S., and technology and communication services have underperformed in Canada. More broadly, recent market action suggests investors have been rapidly repricing away worst-case outcomes as oil prices remain below recent peaks, rates stabilize, and corporate earnings remain resilient—key supports behind the swift rebound to new highs.
   
• U.S.-Iran ceasefire extended - President Trump extended the ceasefire with Iran this week, reducing near-term geopolitical risk and allowing more time for diplomacy. Despite this development, energy markets reflect continued stress. WTI oil prices moved higher as the Strait of Hormuz remains disrupted and the U.S. blockade on ships from Iranian ports continues. Brent crude oil is back about $105, while WTI crude hovers around $96, both up over 65% this year alone. Importantly, however, energy futures markets are reflecting expectations for the disruptions to be short-lived, pointing to crude prices moving back toward the mid-$70s by year-end. If realized, falling oil prices should help ease headline inflation and help reduce pressure on energy-intensive sectors, in our view.
   
• Broadening of market leadership theme may re-emerge – Looking ahead, we do not think investors should assume the market is completely out of the woods. The narrative around the conflict remains fluid, and while the probability of the most adverse outcomes appears to have diminished, considerable uncertainty remains around the duration and resolution of energy supply disruptions. Historically, V‑shaped rebounds have shown a mixed record in sustaining momentum. There have been periods such as the tariff‑induced correction in April 2025 when markets not only recovered quickly but were followed by strong performance. In other instances, equities moved sideways as gains were digested. And in episodes like early 2000 and late 2007, sharp rebounds ultimately marked major market peaks. In the current environment, a pause and sideways phase appear likely, in our view, particularly until oil supplies normalize and physical shortages ease more decisively. If the path toward de‑escalation remains intact, we would expect markets to gravitate back toward the themes that defined performance earlier in the year, with prior leaders reasserting themselves. This would likely entail cyclical sectors regaining leadership over defensives, U.S. small‑ and mid‑caps sustaining relative momentum versus large-caps, and emerging‑market equities continuing to outperform domestic stocks.

Mona Mahajan ;
Investment Strategy

^{Source for all data: Bloomberg.} 

• Markets close higher as U.S.-Iran ceasefire extended – The TSX and U.S. equity markets advanced on Wednesday, with the S&P 500 and Nasdaq notching new closing highs, as investors appear increasingly willing to look through geopolitical uncertainty and refocus on growth and earnings. Technology and communications led gains, reinforcing the market's risk-on tone. Bond yields were mixed, with the 10-year Government of Canada yield up to 3.49% and the 10-year U.S. Treasury yield down near 4.30%. Internationally, Asian markets finished mixed overnight as Japan's Nikkei index reached a record high, closing in on 60,000. The U.S. dollar strengthened against major international currencies.
   
• U.S.-Iran ceasefire extended – U.S. President Trump extended the ceasefire with Iran, reducing near-term geopolitical risk and allowing more time for diplomacy. Despite this development, energy markets reflect continued stress. WTI oil prices moved higher as the Strait of Hormuz remains disrupted and the U.S. blockade on ships from Iranian ports continues. Importantly, energy futures markets are reflecting expectations for the disruptions to be short-lived, pointing to crude prices moving back toward the mid-$70s by year-end. If realized, falling oil prices should help ease headline inflation and help reduce pressure on energy-intensive sectors, in our view.
   
• Earnings season check-in – Tesla, the first of the "Magnificent 7" to report this cycle, is set to release results after the closing bell today. Consensus estimates point to earnings per share (EPS) of $0.36 — a 30% year-over-year increase — on about $22 billion of revenue. More broadly, the early read on first-quarter earnings is encouraging: With 17% of S&P 500 companies reporting, 84% have beaten EPS estimates by an average upside surprise of 13%. Forecasted EPS growth for the quarter has been revised up to over 12%, which, if achieved, would mark the sixth straight quarter of double-digit earnings growth. Technology is expected to lead by a wide margin, with earnings gains of more than 40% year-over-year, followed by materials and financials. Importantly, the breadth of growth is expected to be strong, as eight of the 11 sectors are projected to post year-over-year EPS gains. We believe wide earnings growth should help support more balanced market performance across sectors and help strengthen the case for portfolio diversification.

Brian Therien, CFA ;
Investment Strategy

^{Source for all data: FactSet.} 

• Stocks edge lower on geopolitical uncertainty – North American equity markets closed lower on Tuesday as renewed geopolitical uncertainty outweighed a better-than-expected U.S. retail-sales report. After opening in positive territory, stocks reversed course and finished the day lower following reports that U.S.-Iran negotiations had been paused, with the two-week ceasefire set to expire tomorrow evening. Overseas, Asian markets moved higher overnight, while European markets ended lower in response to the pause in talks between the U.S. and Iran. In addition, the eurozone’s ZEW economic expectations survey fell to its lowest level since 2022, reflecting growing concern about the economic consequences from the war in Iran in Europe. Government bond yields rose, with the 10-year GoC yield climbing to 3.48% and the 10-year U.S. Treasury yield to 4.31%. In commodity markets, oil prices also moved higher, with WTI crude settling at around $91 per barrel.
   
• Consumer check-in – U.S. retail-sales data for March showed that consumer spending remained resilient despite rising oil prices. Headline retail sales rose 1.7% in March, up from 0.7% in February and above expectations for a 1.6% gain. The increase in headline sales was driven in part by a 15.5% surge in spending at gasoline stations amid the spike in oil prices following the war in Iran. However, looking beyond gasoline spending suggests that consumption was strong more broadly. Control-group retail sales — which exclude spending at gas stations, motor vehicle and parts dealers, building materials and garden equipment, and food services — rose a solid 0.7%, above expectations for a 0.2% gain. Additionally, the preliminary ADP employment report showed that U.S. private employers added roughly 55,000 jobs in the four weeks ending April 4, marking the fifth consecutive week of acceleration and pointing to stability in the U.S. labour market. In our view, stabilizing labour-market conditions and steady household spending should continue to support U.S. economic activity over the balance of the year.
   
• All eyes on the next Fed chair – Investors heard from Kevin Warsh on Tuesday morning, President Trump’s nominee to be the next chair of the Federal Reserve, as he delivered remarks before the Senate Banking Committee. Warsh was nominated in late January to succeed current Chair Jerome Powell, whose term runs through May 15. Confirmation appears likely, though the timing remains uncertain after Senator Thom Tillis said he would not vote to confirm any Fed nominees until the investigation into Powell over Fed renovation costs is concluded. Powell has previously said he will remain chair until his successor is confirmed. From a policy perspective, Warsh has argued that interest rates should be lower and has been a vocal critic of the Fed’s balance sheet. While the Fed chair is a highly visible role, the Fed’s structure limits any one member’s influence. Specifically, the Federal Open Market Committee, which votes on monetary policy, gives equal votes to all 12 voting members, and dissents have been common in recent meetings. The bottom line, in our view, is that Warsh likely represents a dovish shift in the Fed chair role on interest rates, but the overall impact should be limited. We continue to believe the Fed’s easing cycle remains intact, with the Fed likely to deliver one or two additional rate cuts this cycle.

Brock Weimer, CFA ;
Investment Strategy

^{Source for all data: FactSet.}