North American Equities: June Wrap - Markets Up, Drama On

Transcript

Good day, everyone.  It is July 7th, 2025.  Peter Hofstra here with an update on North American Equity Markets.  Quite a month, June.  Where do you want to go first?  All-time highs, S&P 500 and the TSX.  There we go.  So, the world can't be all bad, although there's certainly some nastiness still going on in the world.  But why don’t we start with our good friend, Elon Musk?  Can you believe Donald Trump and Elon Musk did not stay best friends forever?  Talk about the most predictable bro divorce in history.  Elon even going so far as to starting a new political party.  So not necessarily market moving at this point, but we know U.S. elections are typically won on very narrow margins.  So, if you can actually split the vote on the left or right, you basically are giving the other side a free pass.  Anyhow, we'll see how that plays out.  But certainly, lots of drama associated with those two.  We've got the passage of the Big, Beautiful Bill.  So probably the biggest thing is makes permanent the tax cuts that were put in place in 2017.  And then some other personal tax benefits around tips and overtime, which was something Trump had promised on the campaign trail.  Benefits to estate and gifting.  So, there you go.  The rich bros will certainly benefit from that.  With spending cuts to come down the road, primarily to healthcare, food programs, student loans and renewable energy.  So could be somebody else's problem to deal with that, but that's how things look, which at least has brought some stability to the tax environment and obviously was a big Bill to get through.  So that is certainly helpful.  Tax spending remains fantastic, so that's solid.  Canada has now got a functioning LNG, liquefied natural gas, terminal.  I think it was June 30th, we actually—our first shipment of liquefied natural gas went out to the Asian markets.  So now we're a global player in what's going to be a very important energy source, probably for decades to come.  LNG is much, much cleaner than coal.  When you burn it, you primarily produce water with a little bit of carbon dioxide, so cleaner whereas coal is just pure carbon dioxide.  Anyway, quick science lesson there.  But that's certainly great to see Canada playing in the global market in something that is a decade overdue.  And to sort of pick up on that, what we're hearing generally is that Canada is becoming more attractive to foreign capital again.  Under their prior liberal government, Canada had become, basically, un-investible.  That's sort of this LNG thing was just delay after delay and hurt us quite a bit.  But now we're seeing that at least the current liberal government, under Mark Carney, is getting the benefit of the doubt and foreign capital is again interested in Canada, until some of the headlines seeing here around infrastructure, build out, reducing barriers between providences.  All this as seen as positive in a more constructive tax regimen.  So, lots of work to be done, but that is all quite constructive.  So, the backdrop looks pretty good.  Markets are all-time highs.  So always a reason to have a balanced portfolio.  Even Europe—I mean this is a North American update, but Europe now committing to 3.5% spending on defense.  Another 1.5% additional in infrastructure related to defense.  Europe could increasingly become a place to invest.  When there's flow of capital, there's certainly opportunity.  So, lots of spending going on.  Still need to get resolution of some larger impacts.  Of course, I guess, during the month U.S. actually bombing Iran, joining Israel.  So, we'll see how that ultimately gets resolved, but certainly, from a geopolitical positioning that could have gone quite badly.  So, risks to keep in mind there, but again, let's not look the gift horse in the mouth.  There does seem to be a pretty positive backdrop, as long as that poor Jerome Powell, who's always getting the rebel beat down doesn’t step in and actually hike rates, which could rattle markets pretty significantly.  So, keep an eye on inflation, those things that can tip the market, but otherwise we'll just appreciate where we are.  We're heading into the dog days of summer.  Hope everyone's well and we'll check in with you in a month.

This podcast is provided as a general source of information and should not be considered personal, legal, accounting, tax, or investment advice, or construed as an endorsement or recommendation of any entity or security discussed. Investors should seek the advice of professionals prior to implementing any changes to their investment. Certain statements in this podcast are forward-looking, that are predictive in nature, depend upon or referred to future events or conditions. Forward-looking statements are subject to risks, uncertainties, and assumptions that could cause actual results to differ materially from those set forth. Although the forward-looking statements contained herein are based upon what CI Global Asset Management and the portfolio manager believe to be reasonable assumptions. Neither CI Global Asset Management nor the portfolio manager can ensure that actual results will be consistent with these forward-looking statements. Certain statements contained in this podcast are based in whole or in part on information provided by third parties and CI Global Asset Management has taken reasonable steps to ensure their accuracy. Market conditions may change, which may impact the information contained in this podcast. Commissions, trailing commissions, management fees, and expenses all may be associated with mutual fund investments. Please read the prospectus before investing. The indicated rates of return are the historical annual compounded total returns, net of fees and expenses, payable by the fund including changes in the security value and reinvestment of all dividends or distributions, and do not take into account sales, redemption, distribution, or optional charges, or income taxes payable by any security holder that would have reduced returns. Mutual funds are not guaranteed, their values change frequently, and past performance may not be repeated.