After an eventful 2015, the equity markets got off to a worrisome start in 2016. At this writing, it is very difficult to predict what will happen on the world’s main stock markets, given the many contradictory signals and the reams of available data.
In Canada, the key rate may remain low in 2016. Exporters are still waiting to see the benefits of the weak loonie, and the record level of household debt is dampening domestic demand. We therefore expect modest returns on the Canadian fixed-income market.
Even though the US stock market has been rising for more than six years, it is neither overvalued nor undervalued. The US economy continues to make slow progress, which the Federal Reserve appears to have confirmed by starting to normalize interest rates. We must not expect record returns in 2016, but rather performances comparable to historical averages.
The other developed countries are encountering more economic difficulty. Countries exporting natural resources such as Canada may continue to struggle with surplus production. We cannot expect very high returns in Canada in 2016, unless the price of oil rises substantially. In Europe and Japan, however, expansionary monetary measures could continue to have a positive impact on the stock markets.
In this context, where should we invest? The traditional answer applies: just about everywhere. Diversification plays a vital role in smoothing out the variability of a portfolio’s returns over a long period. A representative of Services d’investissement FÉRIQUE can help you address this matter!
To contact an Advisory Services representative:
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For more details, also see:
• Our 2015 market review
• The news item Stock markets have a difficult start to 2016
This review has been prepared for the general information of our clients and does not constitute an offer or solicitation to buy or sell any securities, products or services and should not be construed as specific investment advice. All opinions and estimates expressed in this document are as of the time of its publication and are subject to change. The information contained in this document has been obtained from sources believed to be reliable, but we do not represent that it is accurate or complete and it should not be relied upon as such. The content of this presentation is proprietary and should not be further distributed without prior consent of Gestion FÉRIQUE.