• Markets finish the week higher as Iran declares Strait of Hormuz open – The TSX and U.S. equity markets closed higher, with the S&P 500 and Nasdaq reaching new record highs as Iran announced that the Strait of Hormuz is open to commercial shipping during the 10-day Israel-Lebanon ceasefire. Consumer discretionary and industrials led the advance, as fuel-intensive sectors rebounded sharply. Bond yields moved lower, with the 10-year Government of Canada yield at 3.45% and the 10-year U.S. Treasury yield at 4.24%. Internationally, Asian markets finished lower overnight, while Europe traded higher. The U.S. dollar softened against major international currencies, consistent with a modest unwinding of safe-haven demand for the world's reserve currency amid today's risk-on tone.
   
• Oil prices pull back - In energy markets, WTI oil prices fell roughly 9% as some of the geopolitical risk premium was removed with the reopening of the Strait of Hormuz, the narrow waterway that normally handles about 20% of global oil and gas flows. While U.S. restrictions on Iranian ports remain in place, oil futures markets also retreated, now implying crude prices could move back toward the low-$70s by year-end. If realized, falling oil prices should help ease headline inflation and help reduce pressure on energy-intensive sectors.
   
• Earnings season off to a solid start – Earnings season kicked off this week on a positive note, with the six largest U.S. banks delivering better-than-expected earnings per share (EPS). More broadly, the first-quarter S&P 500 earnings outlook has improved. EPS growth has been revised up to roughly 12%, which, if achieved, 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 finished mixed — North American equity markets were mixed on Thursday, with the S&P 500 and Nasdaq each closing at record highs while the TSX was modestly lower. Overseas, Asian markets advanced overnight after China reported better-than-expected first-quarter GDP, while European equities finished mixed. On the corporate front, Taiwan Semiconductor, the world’s largest semiconductor manufacturer, reported sales and earnings above expectations, citing strong AI-related demand as a key driver. Despite solid results, shares closed lower, perhaps highlighting elevated expectations. On the economic front, U.S. initial jobless claims declined to 207,000 last week, while industrial production fell 0.5% in March. Despite the monthly contraction, U.S. industrial production rose at a solid 2.4% annualized rate in the first quarter. Government bond yields were slightly higher on Thursday, with the 10-year GoC yield closing at 3.5% and the 10-year U.S. Treasury yield at 4.31%. In commodity markets, oil prices were modestly higher, with WTI crude settling around $90 per barrel.
   
• Back at all-time highs—where to next? – The S&P 500 closed above 7,000 for the first time in history Wednesday, reaching a new all-time high and fully reversing the 9% drawdown triggered by the war in Iran. The index took just 16 days from its March 30 low to reclaim record territory, as equities rebounded on a U.S.-Iran ceasefire agreement and optimism surrounding the potential resumption of oil tanker traffic through the Strait of Hormuz. Looking at similar episodes—specifically in 1986, 1997, 2000, 2007, 2020, 2024, and 2025—when the S&P 500 recovered from a pullback of at least 8% and reached a new all-time high in less than four months, history suggests that stocks have typically continued to trend higher after breaking through to new highs. On average, the S&P 500 returned 5.5% over the six months following a new all-time high in these periods.* While history offers no guarantee of future performance, we believe a healthy economic backdrop and strong earnings trends should support further equity market gains through the remainder of the year.
   
• Low U.S. jobless claims continue to signal a steady labour market – Initial jobless claims declined to 207,000 last week, down from 218,000 in the prior week and below expectations of 217,000. Year-to-date, initial claims have averaged roughly 212,000, well below the 30-year median of more than 300,000. In addition to low layoff levels, the March payrolls report indicated an improvement in job growth, with employers adding 178,000 jobs during the month and the unemployment rate declining to 4.3%. This rebound lifted the three-month average of payroll growth to 68,000, broadly in line with our expectation for payroll gains to average between 50,000 and 100,000 in 2026. In our view, stable hiring trends and low layoffs should persist throughout 2026, continuing to support household spending and broader economic activity.

Brock Weimer, CFA ;
Investment Strategy

^{Source for all data not cited: FactSet. 
Source for data cited: *FactSet, Edward Jones. S&P 500 Price Index.}  

• Markets close higher as focus shifts toward earnings – The TSX and U.S. equity markets advanced on Wednesday as investors turned their attention toward the start of earnings season. Technology and consumer discretionary stocks led gains, suggesting renewed confidence in cyclical and growth-oriented sectors. Bond yields moved higher, with the 10-year Government of Canada yield at 3.47% and the 10-year U.S. Treasury yield at 4.28%. Internationally, Asian markets rose overnight, while Europe lagged. The U.S. dollar weakened modestly against major international currencies. In energy markets, Western Canadian Select and WTI oil extended their pullback amid reports that the U.S. and Iran may pursue a second round of talks. Futures markets now imply WTI crude prices could drift back toward the mid-$70 range by year-end, which, if realized, could relieve pressure on inflation and energy-intensive sectors.
   
• Banks kick off earnings season – Bank of America and Morgan Stanley reported first-quarter results ahead of the opening bell this morning, with both beating estimates for earnings per share (EPS), offering an encouraging early read on the earnings season. Management commentary from Bank of America pointed to healthy client activity, solid consumer spending, and stable asset quality, indicating a resilient economy. First-quarter earnings for S&P 500 companies are expected to grow roughly 12.5% year-over-year, led once again by technology, followed by materials and financials. But importantly, growth is expected to be broad: 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 and help strengthen the case for portfolio diversification.
   
• Import prices rise less than expected – U.S. import prices increased 0.8% in March over the prior month, coming in well below estimates for a sharper 2.5% rise. Higher prices for fuels and lubricants — up 2.9% month-over-month* — accounted for much of the increase, but outside of energy, import price pressures remained subdued. On a year-over-year basis, import prices were up 2.1%, notably below overall CPI inflation of 3.3%. This gap suggests that lower tariffs may be helping to offset elevated domestic inflation. While energy costs are likely to drive overall inflation higher over the months ahead, we think the impact will be temporary, assuming disruptions in the Strait of Hormuz are alleviated relatively soon.

Brian Therien, CFA ;
Investment Strategy

^{Source for all data not cited: FactSet. Source for data cited: *U.S. Bureau of Labor Statistics} 

• Stocks gain on better-than-expected inflation – North American equity markets traded higher Tuesday, supported by a better-than-expected U.S. producer price index (PPI) reading and generally positive earnings results from several U.S. financial services firms. The S&P 500 gained more than 1%, supported by strength in consumer discretionary and communication services sectors, while the TSX posted a 0.6% gain. Overseas, Asian markets closed higher overnight, led by a gain of more than 2% in Japan’s Nikkei, while European equities also finished broadly higher. In fixed income, government bond yields traded lower, with the 10-year GoC yield at 3.43% and the 10-year U.S. Treasury yield at 4.25%. On the geopolitical front, reports that the U.S. and Iran may hold a second round of negotiations contributed to a pullback in oil prices, with WTI crude oil closing around $92 per barrel. The U.S. dollar index also closed lower amid those developments and has retraced to just above its pre-conflict level.
   
• U.S. producer price inflation lower than feared – U.S. producer price inflation for March came in lower than expected, with headline PPI rising 0.5% for the month versus consensus expectations for a 1.1% increase. Core PPI, which excludes food and energy, rose a modest 0.1%. Encouragingly, core goods prices increased just 0.2% in March, marking the slowest monthly gain in four months and potentially signaling that tariff-related pricing pressures are beginning to ease. Services prices were also flat on the month following a string of firmer readings, pointing to broader disinflationary trends. While one month does not establish a trend, the combination of softer producer-price data and a contained core-CPI reading for March suggests that U.S. pipeline inflation pressures remain under control. Both we and the broader market expect the Fed to remain on hold at its April 29 meeting, and we believe policymakers are likely to maintain a cautious approach to any further easing. That said, if geopolitical tensions begin to fade and core inflation remains well behaved, we see scope for another Fed rate cut later in 2026 or 2027.
   
• First-quarter earnings season underway – Corporate earnings are in focus as well on Tuesday, with JPMorgan Chase, Wells Fargo, Citigroup, and BlackRock among the financial firms reporting results. While the stock reactions were mixed, headline results showed that all four companies exceeded earnings expectations. Results highlighted continued strength in market-based businesses, particularly trading and investment banking, which provided a meaningful boost to performance across the group. Additionally, BlackRock cited record ETF inflows as a catalyst for the quarter. While some commentary suggested a more cautious outlook for net interest income, capital-markets activity appears to be on strong footing. At an index level, despite the war in Iran, earnings estimates have held up well. Consensus currently calls for S&P 500 earnings growth of more than 10% in the first quarter and 17% for the full year. We believe that full-year forecast may prove overly optimistic, especially if higher energy prices weigh on corporate profit margins. Still, we think steady labour-market conditions, resilient economic activity, and strong AI-related investment should help support another year of healthy earnings growth and help provide a constructive backdrop for equities over the balance of the year.

Brock Weimer, CFA ;
Investment Strategy

^{Source for all data: FactSet} 

• Markets rebound from U.S. blockade setback – Stocks started the day on the back foot after President Trump announced a blockade of the Strait of Hormuz but recovered to close higher on headlines that Iran had contacted the U.S. administration to discuss a peace deal. WTI oil prices seesawed through the day to finish at $98 per barrel, down from recent highs of $113, but still well above the pre-conflict levels of between $60-$70. The small-cap Russell 2000 index led the way, rising 1.3% over the session, while among the big-cap benchmarks the tech-heavy Nasdaq index was the best performer, up more than 1% today. In Canada, the S&P/TSX index closed 0.5% higher after a similarly bumpy session. Government bonds also shrugged off a weak start to the day to close higher, pushing yields three basis points (0.03%) lower on the 10-year U.S. Treasury note. Canadian government bonds were broadly flat over the session, with voters heading to the polls today for three special elections which could grant Prime Minister Mark Carney's Liberal government an outright majority. Such an outcome would likely lower the risk of confidence votes and provide a potentially easier pathway to pass further legislation. No party has held a House majority in Canada since 2019.
   
• The latest twist and turns in the Middle East – Following last week's exuberance after the announcement of a ceasefire, the news over the weekend out of the Middle East was mostly disappointing. First, talks between the U.S. and Iran in Pakistan failed to deliver any progress toward a durable peace deal, with reports highlighting Iran's nuclear program as a major sticking point. Second, the announcement of a blockade raised fears over more severe and prolonged disruptions to global energy supplies. The blockade started this morning at 10 a.m. ET and will stop all maritime traffic from entering or exiting Iranian ports. This will restrict Iran's ability to ship its own crude through the strait, hitting a major source of income. However, naval interventions raise the risk of a renewed escalation in the conflict, and will add to concerns that we will not see a resumption of oil flows through this critical supply route. It remains to be seen if the contact today between the U.S. and Iranian leadership will help push negotiations meaningfully forward.
   
• A positive earnings season may support the rebound in stocks - Despite the fragile ceasefire and still‑elevated geopolitical risks, stocks are now within 2% of their all‑time highs. We believe this reflects not only optimism around potential de‑escalation of the conflict, but also strong support from rapidly rising corporate profits. U.S. banks kick off the first‑quarter earnings season this week, with Goldman Sachs missing earnings expectations after lower-than-expected trading revenues. However, the broader tone of reports is expected to be more positive. Consensus is looking for S&P 500 revenue to grow nearly 10% year-over-year and earnings to rise 13%. If realized, this would mark the strongest sales growth since 2022 and the fifth consecutive quarter of double‑digit earnings growth. Investor focus will be on management commentary, particularly regarding the impact of high energy prices. Encouragingly, the primary drivers of S&P 500 earnings are not the sectors most negatively exposed to oil prices. Technology, in particular, has seen the largest increase in expected earnings since December 31, with first‑quarter earnings growth now estimated at 44%. Strength in technology has been sufficient to offset weakness in health care and consumer discretionary. Additionally, the energy sector’s earnings sensitivity to oil prices may help offset cost pressures elsewhere in the market, helping provide further support to aggregate earnings growth. This dynamic underpins the roughly 21% earnings growth expected for the TSX, as upward revisions from the energy sector have led analysts to significantly raise their outlook for corporate profits in Canada.

James McCann ;
Investment Strategy

^{Source for all data: FactSet, Bloomberg.}