Category Archives: news

Earlier this week the Trump administration in the United States surprised global markets with the implementation of reciprocal tariffs across the globe for all major trading partners. The level of tariffs which came, was a surprise to most financial markets for all countries involved.

Donald Trump’s tariffs are widely criticized by economists and market experts, with the Wall Street Journal calling it the “stupidest trade war ever.” The tariffs could also harm the Republican Party, as public opposition grows, and Trump’s economic approval ratings drop. There is a chance the GOP could lose the House in 2026, and despite pleas from Republicans, Trump made the tariffs tougher.

This tariff experiment will likely be remembered as an immense failure. American voters will likely be shocked by the impact of these policies on their daily lives and cost of living; tarnishing the reputation of trade protectionism for years to come.

All in all, we would expect that the announcements made two days ago will have some inflationary pressures and will have also some negative consequences for global growth.  

You will likely be hearing the term ‘stagflation’ in the media. I bring this up only because it may sound alarming, however it is actually quite normal for the circumstances.

Historical evidence suggests that tariffs tend to have a disinflationary effect over time, with a more significant impact on economic growth than on inflation in the long run. However, in the short term (such as a period of 6 to 12 months), tariffs can indeed exert inflationary pressures, affecting certain industries more than others. At this juncture, I should mention, you do not own cars, car parts, steel or aluminum production or potash in your portfolio which are all subject to recent tariffs.

So, what are the implications for you and your investment portfolio? We expect to see a lot of volatility over the coming days; however, we expect markets to settle as we get further through the month of April and details become a bit more well known.

I advise you to refrain from making any significant changes to your portfolio during this period of high volatility. Typically, this is a losing proposition, and such actions result in unfavorable outcomes. Turbulent markets can cause rapid fluctuations that affect investments both negatively and positively within a short timeframe.

If you have a history as an investor, you will know from past corrections, such as the 2008 financial crisis, the 2020 global pandemic, or more recently, the 2022 market correction, that all of these events had significant impacts on valuations near term but to a much lesser extent on the level of income generated by your portfolio.

Our team has taken time in the days and weeks leading up to these announcements to determine our market positioning and have discussed this with many of you. We have been writing calls to lock in premiums for additional income and downside protection, which smooth market fluctuations over time, and we are seeking opportunities where we could potentially be buyers where others are selling.

Additionally, we have been identifying where to allocate capital in industries and companies with a more stable earnings profile, stronger balance sheets, and returns on invested capital, as well as testing dividend expectations. These activities have been ongoing since the beginning of the year.

While this might be a volatile period in the short term; the important principle remains not to act in haste and to stick to our disciplines which have proved to be efficient and profitable for decades.

We will be working to provide you with the best picture of what’s to come, not for the coming weeks, but for the coming year or two. By extending our view beyond the immediate, we can make more informed decisions, provide more efficient and optimal outcomes for your portfolio, and as always, staying true to what your portfolio goals are.

2024 tax returns must be filed by April 30^th.

Enjoy the spring weather.

I have prepared this commentary to give you my thoughts on various investment alternatives and considerations which may be relevant to your portfolio. This commentary reflects my opinions alone and may not reflect the views of National Bank Financial Group. In expressing these opinions, I bring my best judgment and professional experience from the perspective of someone who surveys a broad range of investments. Therefore, this report should be viewed as a reflection of my informed opinions rather than analyses produced by the Research Department of National Bank Financial.

Best,

National Bank Financial

Rob Hunter                                 Campbell Hunter

Senior Wealth Advisor                 Wealth Advisor CIM®

Sources: Reuters, AGF, Fidelity, The Wall Street Journal

National Bank Financial – Wealth Management (NBFWM) is a division of National Bank Financial Inc. (NBF), as well as a trademark owned by National Bank of Canada (NBC) that is used under license by NBF. NBF is a member of the Canadian Investment Regulatory Organization (CIRO) and the Canadian Investor Protection Fund (CIPF), and is a wholly owned subsidiary of NBC, a public company listed on the Toronto Stock Exchange (TSX: NA).

The opinions expressed herein do not necessarily reflect those of National Bank Financial. The particulars contained herein were obtained from sources we believe to be reliable but are not guaranteed by us and may be incomplete. The opinions expressed consider a number of factors including our analysis and interpretation of these particulars, such as historical data, and are not to be construed as a solicitation or offer to buy or sell the securities mentioned herein. Unit values and returns will fluctuate, and past performance is not necessarily indicative of future performance. Important information regarding a fund may be found in the prospectus. The investor should read it before investing.

The particulars contained herein were obtained from sources we believe to be reliable but are not guaranteed by us and may be incomplete. The opinions expressed are based upon our analysis and interpretation of these particulars and are not to be construed as a solicitation or offer to buy or sell the securities mentioned herein. The opinions expressed do not necessarily reflect those of NBF.

The securities or sectors mentioned herein are not suitable for all types of investors. Please consult your Wealth Advisor to verify whether the securities or sectors suit your investor’s profile as well as to obtain complete information, including the main risk factors, regarding those securities or sectors.

I have prepared this report to the best of my judgment and professional experience to give you my thoughts on various financial aspects and considerations. The opinions expressed represent solely my informed opinions and may not reflect the views of NBF.

Selling calls against stock (Covered Writing): Shares may need to be sold at the strike price of the option at any time prior to expiration. If the calls are assigned, further opportunity for appreciation in the underlying security above the strike price is foregone.

Risk/Reward of the strategy = Strike price minus the purchase price of the underlying plus the premium received from the sale of the call. The maximum loss is the same as holding a long position less the premium received.

The investment advice given only applies to residents of the provinces of British Columbia, Alberta, Manitoba, Saskatchewan, Ontario and Quebec.

National Bank Financial is a member of the Canadian Investor Protection Fund.

This quarter’s earnings season is nearly complete with the banks’ reporting. The U.S. banks have shown a positive outlook for 2025, with strong results relative to expectations. The S&P 500 companies are reporting higher earnings for the fourth quarter, with 76% of companies reporting actual EPS above estimates. The blended earnings growth rate for the fourth quarter is 16.9%, marking the highest year-over-year earnings growth rate since Q4 2021.

As you are likely aware, the U.S. has announced a 25% tariff on all Canadian products exported to its territory, along with a specific 10% tariff on the energy sector, effective March 4, 2025.  This move has been justified by the U.S. administration for reasons of national security and the protection of domestic industries. In response, Canada has imposed 25% tariffs on $30 billion of imports from the U.S., effective February 4, 2025, with an additional $125 billion to follow.

A month ago, the discussion was about whether the tariffs would actually occur, where now they tend to be about how long they might last.  The economic impact on Canada will be significant, with an estimated 2.5   percentage point hit to GDP over the next year and a 1 percentage point increase in inflation if they stick.  That said, the Bank of Canada is expected to focus on stabilizing growth at the expense of higher inflation from tariffs on Canada (lowering interest rates).

While markets remain positive year-to-date, they have been choppy since January 20^th. When the world is in a constant state of reacting to a deluge of (negative) news feeds and gross uncertainty we must look in the mirror and remember what we are doing and why.

Two things came to mind. The first is that we strive to invest in what will be true beyond today’s politics and scalding rhetoric. Experience and history have taught us to invest through tumultuous times tactfully and to participate in resilient businesses that will continue to be productive and relevant regardless of the current news cycle. The second thing that comes to mind is the ‘fallacy or seduction of pessimism’, where a pessimist will often sound like someone who has your best interests in mind, yet an optimist can often sound aloof or akin to lofty salesmanship.

 “Save like a pessimist and invest like an optimist” *

Stay the course.

I have prepared this commentary to give you my thoughts on various investment alternatives and considerations which may be relevant to your portfolio. This commentary reflects my opinions alone and may not reflect the views of National Bank Financial Group. In expressing these opinions, I bring my best judgment and professional experience from the perspective of someone who surveys a broad range of investments. Therefore, this report should be viewed as a reflection of my informed opinions rather than analyses produced by the Research Department of National Bank Financial.

Best,

National Bank Financial

Rob Hunter                                        Campbell Hunter, CIM®

Senior Wealth Advisor                      Wealth Advisor

Sources: Reuters, *Morgan Housel

National Bank Financial – Wealth Management (NBFWM) is a division of National Bank Financial Inc. (NBF), as well as a trademark owned by National Bank of Canada (NBC) that is used under license by NBF. NBF is a member of the Canadian Investment Regulatory Organization (CIRO) and the Canadian Investor Protection Fund (CIPF), and is a wholly owned subsidiary of NBC, a public company listed on the Toronto Stock Exchange (TSX: NA).

The opinions expressed herein do not necessarily reflect those of National Bank Financial. The particulars contained herein were obtained from sources we believe to be reliable but are not guaranteed by us and may be incomplete. The opinions expressed consider a number of factors including our analysis and interpretation of these particulars, such as historical data, and are not to be construed as a solicitation or offer to buy or sell the securities mentioned herein. Unit values and returns will fluctuate, and past performance is not necessarily indicative of future performance. Important information regarding a fund may be found in the prospectus. The investor should read it before investing.

The particulars contained herein were obtained from sources we believe to be reliable but are not guaranteed by us and may be incomplete. The opinions expressed are based upon our analysis and interpretation of these particulars and are not to be construed as a solicitation or offer to buy or sell the securities mentioned herein. The opinions expressed do not necessarily reflect those of NBF.

The securities or sectors mentioned herein are not suitable for all types of investors. Please consult your Wealth Advisor to verify whether the securities or sectors suit your investor’s profile as well as to obtain complete information, including the main risk factors, regarding those securities or sectors.

I have prepared this report to the best of my judgment and professional experience to give you my thoughts on various financial aspects and considerations. The opinions expressed represent solely my informed opinions and may not reflect the views of NBF.

Selling calls against stock (Covered Writing): Shares may need to be sold at the strike price of the option at any time prior to expiration. If the calls are assigned, further opportunity for appreciation in the underlying security above the strike price is foregone.

Risk/Reward of the strategy = Strike price minus the purchase price of the underlying plus the premium received from the sale of the call. The maximum loss is the same as holding a long position less the premium received.

The investment advice given only applies to residents of the provinces of British Columbia, Alberta, Manitoba, Saskatchewan, Ontario and Quebec.

National Bank Financial is a member of the Canadian Investor Protection Fund.

Threats about tariffs and how they could hurt Canada’s arguably fragile economy seem to be at odds with the stock market on both sides of the border, though sector participation in Canada is not at all diverse, currently driven by Materials and a historically predictable fear commodity – Gold.

Year-to-date (as of February 13, 2025)

Canada’s TSX                   +3.9%                  largely Materials and IT

U.S. S&P 500                   +3.96%

U.S. Nasdaq                     +3.28%

The logic of tariffs on Canadian goods doesn’t make much sense in a robust American economy.    Some believe that American tax cuts announced in 2018 during Mr. Trump’s first term, will need to be funded from an alternative source of revenue when they end or are renewed in 2025. 

One thing most economists seem to agree on, is that any tariffs will be inflationary and as the Federal Reserve has indicated this week, recent signs of rising inflation will mean no further interest rate cuts in the U.S. perhaps during 2025. 

The Canadian dollar has weakened while the U.S. dollar is hitting new highs.  Keep in mind that a benefit of a multi-currency portfolio, is that to some extent, the strong U.S. dollar is an offset (or your hedge) to a weaker Canadian dollar.   

An unintended potential benefit of tariff news is that Canada awakens to our new reality with a more efficient economy.  Already, there is talk of the potential to eliminate inter-provincial trade barriers, reduce regulation and bureaucracy where it hinders capital investment, while determining a more realistic energy policy around our biggest export, the majority of which currently flows to the U.S.

Often as humans, we have an intellectual bias toward ‘activity’.  In other words, what is going on over there? Whether it be loud politicians or rapid news feeds, the chaos naturally draw us in and can foster uncertainty.  At times like this, I like to remind clients of market history and to stay the course.  Investing versus speculation.

I have attached the following link to our Chief Economists latest Economic commentary in video form:

Economic Impact | National Bank (video)

Hot Charts – Canada: Is “regulation” the most beautiful word in our policymakers’ dictionary?

I have prepared this commentary to give you my thoughts on various investment alternatives and considerations which may be relevant to your portfolio. This commentary reflects my opinions alone and may not reflect the views of National Bank Financial Group. In expressing these opinions, I bring my best judgment and professional experience from the perspective of someone who surveys a broad range of investments. Therefore, this report should be viewed as a reflection of my informed opinions rather than analyses produced by the Research Department of National Bank Financial.

Best,

National Bank Financial

Rob Hunter

Senior Wealth Advisor

National Bank Financial – Wealth Management (NBFWM) is a division of National Bank Financial Inc. (NBF), as well as a trademark owned by National Bank of Canada (NBC) that is used under license by NBF. NBF is a member of the Canadian Investment Regulatory Organization (CIRO) and the Canadian Investor Protection Fund (CIPF), and is a wholly owned subsidiary of NBC, a public company listed on the Toronto Stock Exchange (TSX: NA).

The opinions expressed herein do not necessarily reflect those of National Bank Financial. The particulars contained herein were obtained from sources we believe to be reliable but are not guaranteed by us and may be incomplete. The opinions expressed consider a number of factors including our analysis and interpretation of these particulars, such as historical data, and are not to be construed as a solicitation or offer to buy or sell the securities mentioned herein. Unit values and returns will fluctuate, and past performance is not necessarily indicative of future performance. Important information regarding a fund may be found in the prospectus. The investor should read it before investing.

The particulars contained herein were obtained from sources we believe to be reliable but are not guaranteed by us and may be incomplete. The opinions expressed are based upon our analysis and interpretation of these particulars and are not to be construed as a solicitation or offer to buy or sell the securities mentioned herein. The opinions expressed do not necessarily reflect those of NBF.

The securities or sectors mentioned herein are not suitable for all types of investors. Please consult your Wealth Advisor to verify whether the securities or sectors suit your investor’s profile as well as to obtain complete information, including the main risk factors, regarding those securities or sectors.

I have prepared this report to the best of my judgment and professional experience to give you my thoughts on various financial aspects and considerations. The opinions expressed represent solely my informed opinions and may not reflect the views of NBF.

Selling calls against stock (Covered Writing): Shares may need to be sold at the strike price of the option at any time prior to expiration. If the calls are assigned, further opportunity for appreciation in the underlying security above the strike price is foregone.

Risk/Reward of the strategy = Strike price minus the purchase price of the underlying plus the premium received from the sale of the call. The maximum loss is the same as holding a long position less the premium received.

The investment advice given only applies to residents of the provinces of British Columbia, Alberta, Manitoba, Saskatchewan, Ontario and Quebec.

National Bank Financial is a member of the Canadian Investor Protection Fund.

Despite some near-term volatility, markets did very well last year…again.

Canada’s TSX +18.5%

U.S. broad market S&P 500 +23.3%

U.S. tech dominated index +29%

The U.S. economy seems quite strong where Canada’s economy continues to face challenges with low productivity and GDP growth.  Perhaps significant cuts in interest rates caused the TSX to rally in the second half of the year.

Energy was a strong theme last year and I think it will remain so.  We can’t create electricity fast enough and I am big believer that our abundant supply of natural gas will be the remedy.  In 2025, we (Canada) will start selling liquified natural gas from Kitimat at world prices instead of the usual discount to the U.S.  This is the first time we have done this in our history and there are plenty of countries wanting to buy Canadian gas.

A disruptor is coming into power in the U.S. in a few weeks.  This might bring some benefits in tax cuts and spending.  However, it might also mean potential for driving up inflation again.  Politicians come and go (and come again) but ultimately the consumer drives the economy and right now the U.S. economy seems quite strong.  Of course, let’s hope the urge to buy Greenland, takeover the Panama Canal and make Canada the 51^st state are passing tweets.

The important thing for the coming year is to discern reality from rhetoric. 

Bumps along the way might be a result of uncertainty caused by rhetoric which the market doesn’t like, where reality appears to be a strong economic backdrop in the U.S. that has the potential to take this bull market further.   Our U.S. affiliate Evercore, is suggesting the potential for 6800-7200 on the S&P this year.

TFSA:

You can put $7,000 into your TFSA in 2025.

RSP:

You contribute now for 2024 until March 3, 2025.

You can contribute until December 31^st if you turn 71 years of age this year.

I will be attending the National Bank Financial Energy Conference early next week with Campbell.

Best wishes for this New Year!  Our team will be in touch with many of you about a large maturing call options report for December and again later in January. 

Otherwise, we are a phone call away should you need us.

I have prepared this commentary to give you my thoughts on various investment alternatives and considerations which may be relevant to your portfolio. This commentary reflects my opinions alone and may not reflect the views of National Bank Financial Group. In expressing these opinions, I bring my best judgment and professional experience from the perspective of someone who surveys a broad range of investments. Therefore, this report should be viewed as a reflection of my informed opinions rather than analyses produced by the Research Department of National Bank Financial.

Best,

National Bank Financial

Rob Hunter

Senior Wealth Advisor

Sources:  Evercore ISI, National Bank Economics

National Bank Financial – Wealth Management (NBFWM) is a division of National Bank Financial Inc. (NBF), as well as a trademark owned by National Bank of Canada (NBC) that is used under license by NBF. NBF is a member of the Canadian Investment Regulatory Organization (CIRO) and the Canadian Investor Protection Fund (CIPF), and is a wholly owned subsidiary of NBC, a public company listed on the Toronto Stock Exchange (TSX: NA).

The opinions expressed herein do not necessarily reflect those of National Bank Financial. The particulars contained herein were obtained from sources we believe to be reliable but are not guaranteed by us and may be incomplete. The opinions expressed consider a number of factors including our analysis and interpretation of these particulars, such as historical data, and are not to be construed as a solicitation or offer to buy or sell the securities mentioned herein. Unit values and returns will fluctuate, and past performance is not necessarily indicative of future performance. Important information regarding a fund may be found in the prospectus. The investor should read it before investing.

The particulars contained herein were obtained from sources we believe to be reliable but are not guaranteed by us and may be incomplete. The opinions expressed are based upon our analysis and interpretation of these particulars and are not to be construed as a solicitation or offer to buy or sell the securities mentioned herein. The opinions expressed do not necessarily reflect those of NBF.

The securities or sectors mentioned herein are not suitable for all types of investors. Please consult your Wealth Advisor to verify whether the securities or sectors suit your investor’s profile as well as to obtain complete information, including the main risk factors, regarding those securities or sectors.

I have prepared this report to the best of my judgment and professional experience to give you my thoughts on various financial aspects and considerations. The opinions expressed represent solely my informed opinions and may not reflect the views of NBF.

Selling calls against stock (Covered Writing): Shares may need to be sold at the strike price of the option at any time prior to expiration. If the calls are assigned, further opportunity for appreciation in the underlying security above the strike price is foregone.

Risk/Reward of the strategy = Strike price minus the purchase price of the underlying plus the premium received from the sale of the call. The maximum loss is the same as holding a long position less the premium received.

The investment advice given only applies to residents of the provinces of British Columbia, Alberta, Manitoba, Saskatchewan, Ontario, New Brunswick and Quebec.

National Bank Financial is a member of the Canadian Investor Protection Fund.

The S&P 500 is up over 6.5% since the first interest cut by the Federal Reserve in September.  Likewise, the TSX here in Canada is up over 15% since the Bank of Canada started cutting rates back in June. 

Both Canadian and U.S. markets have been strong since my October letter as we have entered a period technically (November – April) that has been the strongest part of the calendar year for markets historically.

Remember that markets are forward looking or often ahead of the actual underlying economy.  This is the only way for me to explain the Canadian market given current weak GDP growth and low productivity.  I note too, that Canada’s energy policy appears inverse to that of the incoming U.S. administration. 

For me, the election result was a surprise in that one side captured both the White House and Congress.  This means that policy changes may come more easily.

More recently, an appointment has in part, impacted a sector of the market when Mr. Trump appointed Robert Kennedy Junior (RFK) for Health.  This appears to have coincided with some selling in the pharmaceutical sector.

That department oversees the CDC, FDA, NIH, CMS along with other agencies related to human health. Kennedy is a well-known Pharma skeptic, who plans to drastically change healthcare and health regulations. Many healthcare stocks, especially vaccine manufacturers have sold off because of this news. It is still unclear what specific policy changes that RFK will implement. 

That said, healthcare is generally a resilient industry that handles short term volatility well, and tends to recover due to the inelastic nature of the underlying product demand. Much of the recent pullback appears to stem from uncertainty rather than clearly defined outcomes that would directly harm healthcare companies.

I believe we may see some near-term volatility in markets over the near-term from the coming change of U.S. government.

Earnings remain strong on both sides of the border and three banks, Royal, National and Commerce raised their dividends with earnings announcements in the last week. 

Markets…

Canada’s TSX is up 22.86% ytd

S&P 500 (SPX) The U.S. broad market index is up 27.54% ytd

Nasdaq the technology laden index is up 31.94% ytd

If you have any questions, we are a phone call away.

I have prepared this commentary to give you my thoughts on various investment alternatives and considerations which may be relevant to your portfolio. This commentary reflects my opinions alone and may not reflect the views of National Bank Financial Group. In expressing these opinions, I bring my best judgment and professional experience from the perspective of someone who surveys a broad range of investments. Therefore, this report should be viewed as a reflection of my informed opinions rather than analyses produced by the Research Department of National Bank Financial.

Best,

National Bank Financial

Rob Hunter

Senior Wealth Advisor

Sources:  Stockcharts.com, National Bank Economics, Evolve ETFs

National Bank Financial – Wealth Management (NBFWM) is a division of National Bank Financial Inc. (NBF), as well as a trademark owned by National Bank of Canada (NBC) that is used under license by NBF. NBF is a member of the Canadian Investment Regulatory Organization (CIRO) and the Canadian Investor Protection Fund (CIPF), and is a wholly owned subsidiary of NBC, a public company listed on the Toronto Stock Exchange (TSX: NA).

The opinions expressed herein do not necessarily reflect those of National Bank Financial. The particulars contained herein were obtained from sources we believe to be reliable but are not guaranteed by us and may be incomplete. The opinions expressed consider a number of factors including our analysis and interpretation of these particulars, such as historical data, and are not to be construed as a solicitation or offer to buy or sell the securities mentioned herein. Unit values and returns will fluctuate, and past performance is not necessarily indicative of future performance. Important information regarding a fund may be found in the prospectus. The investor should read it before investing.

The particulars contained herein were obtained from sources we believe to be reliable but are not guaranteed by us and may be incomplete. The opinions expressed are based upon our analysis and interpretation of these particulars and are not to be construed as a solicitation or offer to buy or sell the securities mentioned herein. The opinions expressed do not necessarily reflect those of NBF.

The securities or sectors mentioned herein are not suitable for all types of investors. Please consult your Wealth Advisor to verify whether the securities or sectors suit your investor’s profile as well as to obtain complete information, including the main risk factors, regarding those securities or sectors.

I have prepared this report to the best of my judgment and professional experience to give you my thoughts on various financial aspects and considerations. The opinions expressed represent solely my informed opinions and may not reflect the views of NBF.

Selling calls against stock (Covered Writing): Shares may need to be sold at the strike price of the option at any time prior to expiration. If the calls are assigned, further opportunity for appreciation in the underlying security above the strike price is foregone.

Risk/Reward of the strategy = Strike price minus the purchase price of the underlying plus the premium received from the sale of the call. The maximum loss is the same as holding a long position less the premium received.

The investment advice given only applies to residents of the provinces of British Columbia, Alberta, Manitoba, Saskatchewan, Ontario, New Brunswick and Quebec.

National Bank Financial is a member of the Canadian Investor Protection Fund.