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What happened last week Markets swung wildly amid uncertainty and indecision o Last week, COVID-19 fear-related headlines took a backseat to stimulus news out of Canada and the U.S, as both countries made cuts to key interest rates in an effort to mitigate the economic fallout from the virus. Super Tuesday and the U.S. Democratic Party nominee race also briefly distracted investors, leading to a temporary bump in the markets. o The Bank of Canada cut its benchmark overnight... rate from 1.75% to 1.25%. In its statement, the Bank said While Canada’s economy has been operating close to potential with inflation on target, the COVID 19 virus is a material negative shock to the Canadian and global outlooks, and monetary and fiscal authorities are responding. o In an emergency move, the U.S. Federal Reserve announced it was cutting its key rate from 1.25% to 1%, with chairman Jerome Powell stating, My colleagues and I took this action to help the U.S. economy keep strong in the face of new risks to the economic outlook. The spread of the coronavirus has brought new challenges. o These economic developments, in conjunction with news that the virus has spread to over 80 countries, with over 100,000 cases reported, and the state of California declaring an emergency, caused unprecedented swings in the market. The Dow Jones Industrial Average gained nearly 5% on Wednesday, only to drop over 3% on Thursday. The S&P 500 was up 4%, only to drop over 3% during the same period. Canada’s S&P/TSX Composite was up over 2%, but also lost those gains through Thursday and Friday. Both the 10 year Treasury Yield in the U.S. and the 10-Year Government of Canada Yield, safe havens for investors during times of volatility, hit all-time lows during the week. See more

What happened last week Markets plunged as coronavirus continued to spread o Investors were in sell-off mode through the week, moving money out of stocks and into safe havens, given news that COVID 19 had spread outside of Asia. Hundreds of new cases were reported in Europe and the Middle East lifting the global total past 80,000 and fuelling investor fear over its effect on the global economy. It was the worst week for global financial markets since the financial crisis ...of 2008. o North American stock markets fell sharply, with the Dow Jones Industrial Average, the S&P 500 Index and the Nasdaq all dropping more than 10% for the week. The S&P/TSX Composite, which halted trading on Thursday due to a system capacity issue, finished the week down more than 8%. o The 10-year Treasury Yield fell to a new record low of 1.13%, down more than 35 basis points for the month, as investors demanded the safety of U.S. government debt instead of riskier assets. Alberta’s $20-billion Frontier oilsands project was cancelled o The TSX/S&P 500 Index, with its heavy allocation toward the energy sector, was weighed down early in the week, given news that Teck Resources Ltd. would be cancelling its $20 billion Frontier oil development project due to uncertainty. A letter from Teck to the federal Environment Minister explained its decision, and urged Canadian governments to reconcile climate policy and responsible energy sector development: Without clarity on this critical question, the situation that has faced Frontier will be faced by future projects and it will be very difficult to attract future investment, either domestic or foreign. Critics of the federal government linked the news to its handling of recent protests that blocked rail lines. These protests support Indigenous people who are opposed to the $6-billion Coastal GasLink pipeline project in their traditional territory in B.C. and have impacted critical supply chains for more than three weeks. U.S. and Canadian Q4 GDP readings pointed to slower growth o A second GDP reading released by the U.S. Commerce department confirmed that the economy grew by 2.1% in Q4, despite slowing consumer and government spending, and business investment. o In line with the Bank of Canada’s forecast, economic growth in Canada slowed to an annualized rate of 0.3% in Q4 the lowest level in four years according to Statistics Canada. Pipeline shutdowns, poor weather conditions for harvesting, and November’s CN Rail strike contributed to the slowdown See more

What happened last week Markets continued reacting to coronavirus news o For the fifth consecutive week, erratic coronavirus news continued to influence the marketplace, forcing investors to navigate the uneven landscape. o The week started with markets in negative territory following somber news that the head of a leading hospital in Wuhan, China the epicenter of the outbreak died of the disease. Later, Apple Inc. revealed they expect to miss quarterly sales targets ...because of supply-chain disruptions from the outbreak. o On Wednesday, reports of the virus decelerating set off a market rally that pushed the S&P/TSX Composite, S&P 500 and the Nasdaq to new closing highs. The Dow Jones Industrial Average rose 115 points, narrowly missing its own record. o By week’s end, investor optimism waned following news that two passengers from the virus-hit Japanese cruise ship died, and 90 people from a church in Daegu, South Korea, had signs of infection. South Korean authorities described this as a super-spreading event. Blockades continued to halt Canada's rail network o National protests and rail blockades continued in support of Wet'suwet'en First Nation’s efforts to block construction of the $6-billion Coastal GasLink pipeline project on their traditional territory in B.C. Via Rail announced nearly 1,000 layoffs Wednesday in response to the nationwide rail shutdown, while CN Rail said it had temporarily let go of 450 workers. In its statement, CN warned of imminent network shutdowns and noted the impact is also being felt beyond Canada's borders and is harming the country's reputation as a stable and viable supply chain partner. Canadian inflation rate climbed 2.4% to start the year o Statistics Canada said January’s 2.4% jump was fueled by higher gas prices and more expensive fresh produce. The price of tomatoes, specifically, was up 10.8% because of unseasonable growing weather in the U.S. and Mexico. Higher mortgage interest costs and auto insurance premiums also contributed to the year-over-year inflation number. The average of three key inflation measures met the Bank of Canada’s 2% target, supporting the central bank’s current monetary policy. See more

What happened last week Stock markets rallied to record levels o Global financial markets continued to absorb the economic impact of the coronavirus epidemic. With China’s central bank providing a liquidity injection of 1.2 trillion yuan ($228 billion) into their economy on Monday, and better than expected U.S. economic data rolling in through the week, investors moved money into equity markets. o All North American stock markets reached record intra-day highs through the w...eek, posting all time closing highs on Thursday. o Markets got a further boost on Thursday with the Chinese government confirming it would cut tariffs on US$75 billion of U.S. imports on Feb. 14, as part of its phase one trade agreement with the U.S. Economic data pointed to resilience in U.S. economy o The Institute for Supply Management (ISM) reported U.S. manufacturing activity rebounded in January after shrinking for five straight months. The U.S. Commerce Department reported factory goods orders surged 1.8% in December, the largest gain since August 2018. o The ISM said its non-manufacturing activity index increased to the highest level since August. o In January, U.S. companies hired the most workers in a single month since May 2015, according to the ADP Research Institute. A U.S. Labor Department report indicated the number of Americans filing for unemployment benefits dropped to a nine-month low in the previous week. U.S. Senate acquitted President Trump on impeachment charges o President Trump’s acquittal eliminated investor concern over effects the impeachment process could have on the economy. o The acquittal followed a day after President Trump’s annual State of the Union Address, which he delivered as a campaign-style speech highlighting the performance of the economy during his administration; part of what he called the great American comeback. The President touted the 50 year low unemployment rate, surging stock markets and a blue collar boom in manufacturing jobs. He pointed to renegotiated trade deals, such as the U.S.-Mexico-Canada agreement, as proof of America’s resurgence in the global economy. The President also referred to the recently completed phase-one trade agreement with China, noting: We have perhaps the best relationship we have ever had with China." Canadian manufacturing, trade and employment numbers buoyed investors o According to the IHS Markit Canada Manufacturing Purchasing Managers’ Index, Canadian manufacturing activity expanded in January for the fifth straight month. o Statistics Canada reported that Canada posted its smallest goods trade gap in seven months in December, as exports rebounded due to the return of rail and pipeline services following November interruptions. o In a separate report, Statistics Canada said the Canadian economy added 34,500 full time positions in January, beating economist expectations by 17,500. The unemployment rate dropped slightly to 5.5% in the month, from 5.6% in December. See more