We’ve outperformed the major banks over the last three years. Take a look at our 1, 3 & 5-Year Return below.
Global equity markets finished largely unchanged over the week ended February 27. Investors demonstrated some caution over the week amid trade uncertainty and the payoff for artificial intelligence, particularly as NVIDIA Corp. delivered a 2026 sales forecast that underwhelmed investors. In Canada, the S&P/TSX Composite Index advanced, led by the materials sector. U.S. equities edged lower. Yields on 10-year government bonds in Canada and the U.S. declined. The price of oil and gold moved higher over the week.
Canada’s economy contracts in the fourth quarter
Canada’s gross domestic product (GDP) shrank at an annualized pace of 0.6% over the fourth quarter of 2025. The decline was deeper than the 0.2% contraction economists had expected.
The Canadian economy was dragged down by a significant decline in business inventories, which may not be a consistent issue in the quarters to come.
So, despite the fourth quarter contraction, the economy does appear to be relatively solid. Consumer spending increased over the quarter, while exports rose, despite trade tensions with the U.S.
Over 2025, Canada’s economy grew by 1.7%. This marked the slowest pace of growth since 2020. Canada’s economy was clearly hindered by trade disruptions with the U.S., which raised consumer and business uncertainty.
The result did little to change expectations for the Bank of Canada (BoC) to hold its policy interest rate steady at its March meeting. The economy progressed largely in line with the BoC’s outlook, as has inflation.
The U.S. State of the Union touts economic accomplishments
U.S. President Donald Trump delivered the longest State of the Union address ever as he discussed his economic accomplishments and record stock markets ahead of the U.S. midterm elections later this year.
On trade, Trump noted his displeasure with the U.S. Supreme Court’s decision to vote against his tariffs, which were a key part of his agenda.
Last week, a baseline 10% tariff on U.S. imports went into effect after the “Liberation Day” tariffs were voted down, as Trump found additional legal avenues in Section 122 of the 1974 Trade Act to restore tariffs. The U.S. administration is looking to raise the baseline tariff to 15%.
U.S. Trade Representative Jamieson Greer said he spoke with Canadian officials and both sides agreed to resume trade negotiations, with Canadian officials planning to visit Washington in the upcoming weeks.
There is still some uncertainty for the Canada-United States-Mexico Agreement (CUSMA), which comes up for review this year. News reports have said that President Trump is considering withdrawing from CUSMA.
European Union postpones ratification vote on U.S. trade deal
Following the U.S. Supreme Court’s decision to vote down President Trump’s use of emergency powers to impose tariffs, the European Union (EU) halted its ratification process for its trade agreement with the U.S.
The EU is looking to better understand how the new baseline 10% tariff impacts its trade deal with the U.S. The EU and U.S. reached a trade deal during the summer of 2025, but the new baseline tariffs raise the legal uncertainty around that agreement.
Meanwhile, the EU inflation rate slowed to 1.7% in January from 2.0% in the previous month, according to a final estimate. This marked the EU’s softest inflation rate since September 2024.
Growth slowed in Europe over 2025 amid trade tensions with the U.S. and slower global economic activity. In Germany, Europe’s largest economy, GDP growth provided some hope of improving conditions heading into 2026. Germany’s economy expanded by 0.3% in the fourth quarter of 2025, which was its fastest pace of growth since the first quarter of 2025.
EU officials are unsure how the new baseline tariffs will impact its trade agreement with the U.S. and the European economy.
Lacklustre start to 2026 for Japan’s industrial output
Industrial production in Japan rose by 2.2% in January 2026, which was the fastest pace of growth since September 2025 and followed two consecutive monthly declines.
The headline figure includes front-loaded exports from China for the Lunar New Year holiday, dampening markets’ excitement for the result. Economists were expecting a 5.5% monthly increase.
On a year-over-year basis, industrial production rose by 2.3% in January, missing expectations and below the 2.6% annual increase in the previous month.
Meanwhile, retail sales rose by 1.8% year over year in January, topping the 0.1% increase economists had expected and rebounding from the 0.9% decline in December. Consumer spending was boosted by recent stimulus measures, which were meant to boost domestic spending.
Japan’s economy was on shaky ground over much of 2025 amid trade tensions with the U.S. and higher interest rates and elevated inflationary pressures. The Bank of Japan raised interest rates further in 2025 and could lift its policy interest rate again in 2026.
🏆 Connect with an Advisor today
