Market week: Stocks make solid weekly, monthly gains
New mid-cap funds from CI, real asset pools from Mackenzie
The main North American stock market indices posted gains for the week and the month, with investor sentiment turning more positive as the COVID-19 pandemic lockdowns were gradually eased. Investor mood was further lifted as U.S. President Donald Trump did not impose any new tariffs on Chinese goods and did not move to end the Phase 1 trade deal. In addition, while the Chicago Purchasing Managers Index fell to 32.3 in May (any reading below 50 indicates contraction), the University of Michigan’s consumer confidence index rose to 72.3 in May from 71.8 in April.
The S&P 500 Composite Index of large-cap U.S. stocks gain 3.0% on the week and booked a 4.5% return for the month, while the technology-weighted Nasdaq Composite Index climbed 1.8% on the week, for a 6.8% surge in the month. The Nasdaq is now ahead 5.8% for the year to date.
In a flash estimate on Friday, Statistics Canada reported that Canada’s gross domestic product fell 11% from March. Following a 7.2% GDP decline in March, first-quarter GDP contracted at an annualized rate of 8.2%, the biggest decline since the first quarter of 2009 during the financial crisis. Toronto’s benchmark S&P/TSX Composite Index gained 1.9% on the week and posted a 2.8% advance for the month, helped along by the energy sector, which was buoyed by an 87.5% rally in the price of West Texas Intermediate crude oil in May.
Fund news and updates
* SEI fund name changes. SEI Investments Canada announced on May 28 name changes to three of its mutual funds.
- SEI Balanced Fund will be renamed SEI Neutral Balanced Fund.
- SEI Growth Fund will be renamed SEI Balanced Growth Fund.
- SEI Moderate Fund will be renamed SEI Income Balanced Fund.
* Mackenzie debuts mid-cap fund, changes fund names. Mackenzie Investments on May 27 launched Mackenzie US Mid Cap Opportunities Fund. Kristi Ashcroft, Senior Vice President and Head of Product, Mackenzie Investments, said, “Many investors favour larger companies, but there’s a unique risk-return opportunity between fast-growing small businesses and mature large companies that can help to diversify portfolios and provide the potential for strong returns.”
The fund will be managed by Senior Vice President Phil Taller, Vice President and Portfolio Manager Sonny Aggarwal, and Associate Portfolio Manager John Lumbers.
In addition, Mackenzie announced that Mackenzie US Mid Cap Growth Class will be renamed Mackenzie US Small-Mid Cap Growth Class and Mackenzie US Mid Cap Growth Currency Neutral Class will now be known as Mackenzie US Small-Mid Cap Growth Currency Neutral Class.
* CI launches private pools with real asset focus. In a May 26 release, CI Investments Inc. announced it is launching three new private pools that focus on real assets – infrastructure and real estate. The pools are available in both mutual fund and exchange-traded fund series.
- CI Global Infrastructure Private Pool (TSX: CINF)
- CI Global REIT Private Pool (TSX: CGRE)
- CI Global Real Asset Private Pool (TSX: CGRA).
The pools invest primarily in real estate investment trusts, equity securities of companies involved in the residential and commercial real estate sector, and/or companies with either direct or indirect exposure to infrastructure. These investments are considered real assets because their value is related to underlying physical assets. The portfolios are managed by Signature Global Asset Management, a subsidiary of CI Investments.
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