Market Ethos - Feb 7th 2019

- Prepared by: Justin Groff, MSc 2020



Week in Review:

Last week we noted that the markets had posted the best monthly performance since October 2015. After closing out the first week of February, it’s needless to say that the January Effect will be missed. From a macro view, investor concerns have shown in the markets as European economic growth seems to be slowing and China-US trade relations continue to sway. There have been indications that the US may ban Chinese telecom makers, and while talks are ongoing between the countries, there has been no meeting set between Trump and Xi before the end of the 90-day tariff reprieve on March 1. Maybe China has been preoccupied celebrating the year of the pig this week?

On a more positive note, massive news for the Canadian job market was released this week. Canada added 66,800 jobs in January alone, compared to an estimate of only 5,000. Us millennials seem to be keeping busy these days, with unemployment down to only 6.9% for those aged 15-24 years old. This job growth paired with an increase of 1.8% in hourly wages makes it seem as if paying off these student loans may actually be feasible!




The markets seemed to agree, pushing the Canadian Dollar up almost half a penny to 0.7534. Hopefully this positive news extends to the markets as earnings season ramps up in Canada.

Stocks to Watch:

Tata Motors dropped by nearly 30% in overseas markets. The Indian multinational posted their biggest loss in company history today, after sales of Jaguar Land Rover in China fell by more than 40%. Production fell by nearly 16% last year, and this poor start to 2019 may suggest the company is in serious trouble.

More than 250 companies will be reporting next week, so expect some volatility. Here are some notable companies reporting:

- Under Armour, Feb. 12

- Molson Coors, Feb. 12 (Activity of Ivey students indicates strong growth)

- Equinix, Feb. 13

- Coca-Cola, Feb. 14

- NVIDIA, Feb. 14

- Enbridge, Feb. 15



Recommended Reading:

Capital Markets:

Jaguar Land Rover causes biggest loss in Indian corporate history:

https://www.cnn.com/2019/02/08/investing/tata-motors-jaguar-land-rover/index.html

Most actively traded companies on the TSX:

https://business.financialpost.com/pmn/business-pmn/most-actively-traded-companies-on-the-tsx-387

Technology:

This 23-year-old just closed her second fund – which is focused on aging – with $22 million: https://techcrunch.com/2017/08/22/this-23-year-old-just-closed-her-second-fund-which-is-focused-on-aging-with-22-million/?fbclid=IwAR09xXBgktuMgfXXlJUccdiwemxXg12120EMJzQFRd4lqmUIdw1Fe14a5bM

Facebook acquires visual shopping startup to bolster AI work: https://www.bnnbloomberg.ca/facebook-acquires-visual-shopping-startup-to-bolster-ai-work-1.1211604

Economics:

Canada’s job market surges on record private-sector hiring: https://www.bloomberg.com/news/articles/2019-02-08/canada-s-job-market-surges-on-record-private-sector-hiring?srnd=premium-canada

Trump is reportedly expected to ban Chinese telecommunication equipment from US networks: https://www.cnbc.com/2019/02/08/trump-may-reportedly-ban-chinese-telecom-equipment-on-us-networks.html


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