The U.S. and Canadian stock markets hit another all-time high last week – the S&P 500's 26th of the year -- on continued optimism that the US and China are making progress toward a "Phase 1" trade deal. Fresh data also showed the North American economy remains on sound footing with better than expected U.S. initial jobless claims and a rise in October U.S. personal spending, signaling consumers remain in fairly healthy shape heading into the holiday season. Meanwhile the latest Canadian GDP report revealed that the domestic economy expanded at a 1.3% pace in the third quarter. Encouragingly, business and housing investment each rose, along with a modest increase in consumer spending, which helped offset the drag from trade activity.
With last week's U.S. Thanksgiving holiday, the market continues to make a convincing case for its inclusion on a list of things to be thankful for. Both the stock and bond markets are having a banner year, including the strongest TSX gains in a decade and the best year for the S&P 500 since 2013. While we can certainly appreciate this year's performance, investors shouldn't take it for granted. We think conditions remain sufficiently nourishing for an extension to the bull market, but not without bouts of indigestion.
U.S. Thanksgiving marks a turn into the homestretch for the year and shifts the attention to the holiday shopping season. With that in mind, we've dished up some holiday perspectives on market performance and the role the consumer is likely to play.
Turkey-day track record
Consumers in control
A good recipe, but watching for a sugar high
Craig Fehr, CFA
Sources: 1. FactSet, S&P 500 index total return. 2. Federal Reserve Board
|S&P 500 Index||3,141||1.0%||25.3%|
|10-yr GoC Yield||
|Canadian Dollar||US $0.75||0.0%||2.8%|
FacSet, 11/29/19. *4 day performance ending Thursday. Bonds represented by the iShares Core U.S. Aggregate Bond ETF. Past performance does not guarantee future results. .
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