Weekly economic review

Sébastien Mc Mahon, CFA

Senior Portfolio Manager, Diversified Funds & Economist

03/06/2020

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A look at this week’s marketsAt the close on Thursday

Source: iA Economics, data via Bloomberg *WTD/YTD = Week-to-date / Year-to-date

Week-to-date Year-to-date

Canadian Bonds (total return) Local currency In CAD Local currency In CAD

FTSE TMX Universe 1.75% 5.45%

FTSE TMX Long 2.50% 8.63%

Corps 1.25% 4.39%

Equities (total return)

S&P/TSX 1.84% -2.50%

S&P 500 2.39% 2.42% -6.07% -3.03%

MSCI EAFE 1.17% 2.75% -8.15% -5.56%

MSCI Emerging 3.00% 3.43% -4.21% -3.59%

Other Current price Return WTD* Return YTD*

Oil (WTI) 45.90 $ 2.55% -24.83%

USD/CAD 0.7457 $ -0.03% -3.14%

Gold 1 672.23 $ 5.46% 10.21%

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Coronavirus:Looking under control in China, Europe is following the same trend

Cumulative number of COVID-19 cases:

China vs Europe

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Global economy:China hurting big, U.S. still doing fine

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Fed & Bank of Canada:Concerted rate cuts of 50 bps each

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Interest rates:At all-time lows

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Markets:Still dominated by fear

Source : WSJ & CNN Money

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Wall Street:Biden back from the dead after a strong Super Tuesday

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Wall Street:Bottoming is a process…

Source : Strategas

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Wall Street:Corrections are generally erased after 4-6 months…

Source : BCA

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Reactions of governmental authorities:Fiscal stimulus announcements abound

Equivalent to 3.5 Trillion USD!

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What we’ll be watching next week

• Canada:

Housing Starts (last month: 213.2K in January)

Building Permits (last month: +7.4% MoM in December)

Existing Home Sales (last month: -2.9% MoM in January)

• U.S.:

CPI Inflation (consensus: lower at 2.2% YoY in February)

Core CPI Inflation (consensus: stable at 2.3% YoY in February)

• Europe:

ECB Rate Decision (consensus: 10 bps rate cut to -0.60%)

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To reach and follow us:

www.ia.ca/economy and LinkedIn

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Disclaimer

Opinions expressed in this presentation are based on actual

market conditions and may change without prior warning. The

aim is in no way to make investment recommendations. The

forecasts given in this presentation do not guarantee returns and

imply risks, uncertainty and assumptions. Although we are

comfortable with these assumptions, there is no guarantee that

they will be confirmed.

Industrial Alliance Insurance and Financial Services Inc.