Welcome back to the Canadian Monthly Market Wrap from YCharts! Here, we break down the most important market trends for Canada-based advisors and their clients every month. As always, feel free to download and share any visuals with clients and colleagues, or on social media.
Canadian equities suffered a rough June, with the S&P/TSX 60 tumbling 8.3%. Both Canadian Small and Large Caps fell by double-digits, 13.2% and 10.2% respectively. The TSX’s 8.3% decline was matched in the United States by its counterpart, the S&P 500, as well.
As a result, not a single sector was positive in June. The Materials sector dropped nearly 15%, while Energy came in just behind, down 14.5%. Utilities and Consumer Staples, sectors that are typically less sensitive to cyclical economic growth, were the only two that didn’t suffer declines of 8% or more.
Inflation in Canada surpassed 7% for the first time since March 1983, coming in at 7.73% for May 2022. May’s inflation print also marked the eleventh consecutive monthly increase. The price of gold in CAD was practically unchanged as well. However, recent month’s unemployment and production data was strong—the Canadian unemployment rate fell to another all-time low of 5.1%, and the Canada Ivey PMI jumped from 66.3 to 72, a rebound of 8.6%.
Following a nearly 8-point decline in April, the Canada Ivey PMI rebounded from 66.3 to 72.0 in May, nearing its all-time high of 74.20 set in March. In addition, Canada Real GDP increased 0.34% in April, marking the third straight month of Canadian economic growth.
Canadian Inflation clocked in at 7.73% in May, rising nearly one full percentage point MoM and reaching the highest level since February 1983. May’s print also marks the eleventh consecutive inflation increase. Canada’s Consumer Price Index marched upward with inflation, rising 1.07% in May.
The price of gold was $2,357.40 CAD per ounce as of June 24th, about unchanged month-over-month. Despite the tepid price movement in gold, the iShares S&P/TSX Global Gold ETF (XGD.TO) tumbled 11.2% in June and is now down 10.2% year to date.