Market and Investment Insights

March 2021

Improving Outlook

It has been one year since the S&P 500 hit a bottom on March 23rd. Since then, the index had gained nearly 75% and is showing few signs of slowing. The S&P/TSX Composite has similarly returned over 65%, although these returns have been more concentrated in precious metals and the high‐flying share price of Shopify, which has benefited significantly from changes in consumer behaviour since the start of the pandemic. While record‐low rates and massive amounts of stimulus have been fueling higher equity prices, the focus is now on whether corporate earnings will keep up with expectations as we begin reopening the global economy.

As the vaccine rollout gains momentum, consumer and business confidence has been climbing. The CFIB’s Business Barometer, which measures the confidence and operating conditions of small businesses in Canada, reached 68.2 in March, the highest the index has been since April 2011. This is a substantial year‐over‐year recovery after the index hit a low of 30.84 in March 2020.

Canadian employment had a roaring month as the labour market added 303K jobs, vastly exceeding estimates for an addition of 100K, causing the unemployment rate to fall back to 7.5%. This is higher than the pre‐pandemic rate of 5.6% but is a significant improvement over the high recorded last May of 13.7%. Whether the economy can continue building on these job gains depends largely on future shutdowns and improved vaccination rates.

With trade data from February beginning to roll in, we can see the effect the global shortage of semiconductor chips is having on one of Canada’s largest export sectors. Total trade within the Canadian automotive sector fell 8.8% during the previous month as production was hampered due to the shortage.

With an economy that is still adapting to the new way of life, we have maintained our portfolio tilt towards quality investments that can withstand volatility. We remain adaptable to capitalize on growth opportunities.


Portfolio Contributors

  • iShares Global Healthcare ETF gained 4.22% during the month. Shares were pushed higher by U.S. vaccine producers and benefits provider, UnitedHealth Group Inc.
  • EdgePoint Global Portfolio had another strong month, returning 3.43%. Results were driven from positive returns across the portfolio.

Portfolio Detractors

  • iShares Clean Energy ETF settled further down, losing 7.3% for the month. Losses were contained primarily to two holdings that missed earnings estimates.
  • Holdings of ARK Innovation ETF pulled the share price down 9.1%. The portfolio of high‐growth companies continue to be pressured by equity repricing amidst rising yields.


All performance data generated and retrieved from SIA Charts (

Proxy funds used for benchmark indexes:

  • Canadian Universe Bond Index: iShares Canadian Universe Bond Index EFT (XBB.TO)
  • MSCI World Index (CAD): iShares MSCI World Index EFT (XWD.TO)