Canadian Equities Rally Faces Trade and Rate Tests
Canadian stocks have risen sharply this year, yet trade friction and the risk that interest rates stay elevated could challenge further gains. A TD Asset Management portfolio manager discusses what has supported the market and large investment projects that may present opportunities.
Canadian equities have climbed notably during the year even as trade disputes persisted. Michael O’Brien, who helps lead Canadian equity portfolio management at TD Asset Management, addresses the forces behind that performance.
The outlook remains sensitive to borrowing costs staying higher for longer and to continuing trade friction. At the same time, substantial investment projects are identified as possible sources of opportunity for the market.
Canadian equity moves may matter to households with retirement accounts, pension beneficiaries, and individual investors, since portfolio values can shift with market performance. If rates remain elevated, borrowing costs for consumers and businesses could stay higher, potentially weighing on spending and valuations. Trade friction may affect Canadian exporters and related workers. The overall effect could vary widely by portfolio and income situation.