A Personal Note

Thank you all for your patience and understanding as I took two weekends off to spend time with my family. First off, I was in Winnipeg to be with mom Mom and family as we celebrated her 85th birthday, and then my wife and I were blessed to be able to have our 3-year old granddaughter with us for a full week! I’m happy to be back to my regular schedule.

The Week in Review

Weekly Market Recap: U.S. and Canada

Do not adjust your set. What you saw Thursday and Friday is real.

Every major index plummeted this week with all the intensifying trade tensions and fresh concerns over inflation and growth. The Nasdaq 100, S&P 500, Dow Jones, and TSX all sold off sharply, with volatility picking up significantly mid-week. Interestingly, the markets opened the week on relatively stable footing, but everything changed in a heartbeat mid-week. The selloff mirrored some of the worst stretches since 2020, and fears of a potential recession gained traction.

In terms of performance, the Nasdaq 100 led the declines, sliding 9.77%. The S&P 500 wasn’t far behind, down 9.08%, while the Dow Jones dropped 7.86%. Canada’s TSX held up slightly better, but still fell 6.19% by week’s end. Safe to say, this was one of the more brutal weeks we’ve seen in a while.

Major Economic Stories

This week’s economic updates painted a mixed but increasingly fragile labor market picture. U.S. job growth was relatively solid, but rising unemployment rates and job openings data pointed to cooling momentum on both sides of the border.

Here’s the major economic news from this week:

Canada Jobless Rate Climbs

Canada’s unemployment rate rose to 6.7% in March, signaling a cooling job market.

The labor force shrank alongside a drop in participation and net employment. The loss of 32,600 jobs, including 62,000 full-time positions, is a crystal clear sign of growing economic fragility.

• Participation rate fell to 65.2%, lowest in five months

• Labor force declined alongside unemployment increase

• Employment missed forecasted 12,000 job growth

• Total employed stood at 20.96 million

Read the Full Release

U.S. Unemployment Ticks Up

The U.S. jobless rate increased slightly, to 4.2%, despite strong job creation.

More people rejoined the labor force, and that pushed unemployment higher. Still, broader underemployment eased and participation showed a slight improvement.

• Labor force participation rose to 62.5%

• U-6 unemployment rate slipped to 7.9%

• Employment-population ratio remained steady at 59.9%

• Total employment climbed to 163.51 million

• Read the Full Release

U.S. Job Openings Dip Below Forecasts

Job openings fell in February, pointing to weaker labor demand.

Sectors like retail, finance, and healthcare drove the drop. Though hiring and separations held steady, the slowdown hints at broader softening.

• Retail trade lost 126,000 job postings

• Finance and insurance openings down by 80,000

• Openings fell across all major U.S. regions

• Manufacturing openings dropped by 31,000

• Read the Full Report here.

U.S. Adds 228,000 Jobs in March

March job gains topped forecasts, led by healthcare and transport hiring.

Interestingly, although job openings fell, employment strength returned after weak February figures, helped by a retail rebound. That said, major sectors like construction and manufacturing remained mostly flat.

• Healthcare created 54,000 new positions

• Social assistance added 24,000 jobs

• Transportation and warehousing rose by 23,000

• Retail recovered post-strike with 24,000 jobs

• Read the full report here

Key Takeaways From this Week’s Economic News

Canada’s Labor Market Hits a Wall

I’m not going to sugarcoat this. The latest Canadian job numbers paint a worrisome picture. Not only did the unemployment rate rise to 6.7%, but we also saw a drop in the participation rate and the biggest monthly loss in full-time jobs since 2021. That combination of fewer people working and fewer even looking is never a good sign, and it suggests economic discouragement is setting in.

It is possible that a slight uptick in the unemployment rate can sometimes reflect renewed optimism (more people returning to the job hunt), but that’s not what we’re seeing here. This looks more like a market starting to buckle under the weight of high rates, fading demand, and now, trade tensions with the U.S. As more rate cuts become priced in, the Bank of Canada will have to carefully navigate between supporting growth and avoiding another inflationary flare-up.

Trump Tariffs Stoke Recession Fears

Trump’s so-called “Liberation Day” might go down as the moment markets fully accepted the return of trade war politics. Reciprocal tariffs this broad, paired with his over-the-top rhetoric and no clear exit strategy, are more than just a negotiation tactic. The result: U.S. stocks plummeted, the dollar wobbled, and recession odds jumped past 50% on some betting markets.

What concerns me most is the disconnect between the administration’s confidence and what the data is showing. If you watch some of the White House representatives on TV, you’d swear nothing out of the ordinary is happening. It’s all part of the plan, they say. But higher inflation, falling real wages, and now retaliation from major trading partners does not point to a soft landing. And if consumers are hit with higher prices at a time when the job market starts to cool, that’s a tough combo.

The Fed Is Cornered

Jerome Powell’s comments on Friday (more below) show just how stuck the Fed is right now. On one hand, the U.S. job market is still generating solid employment gains, which normally argues against cutting rates. On the other, Trump’s tariffs are likely to raise prices and slow growth, and that puts the Fed in a bind: ease too soon and risk fueling inflation, or wait too long and risk a deeper downturn.

Powell said he would be patient, but markets aren’t buying it, and when we look at rate cut expectations, they are aggressive. What I found telling was his emphasis on “waiting for greater clarity.” That sounds like a Fed that wants more data before moving, even if political pressure builds. Core inflation is already above target and with consumer sentiment showing cracks, the Fed will likely need a bigger shock, or an even deeper market correction, before it blinks.

THIS WEEK’S POLL QUESTION
(Results in Next Week’s Newsletter)

It was all about Trump’s tariffs again this week. Some say it’s about time the U.S. got tougher on trade, while others worry it could backfire and drag the economy down. I’m curious what you think. Could these tariffs actually push the U.S. into a recession?

Let us know where you stand!

LAST WEEK’S POLL RESULTS

The price of gold faltered a bit later in the week, but it has been trading at all time highs recently. 72% of respondents to our last poll question believe that gold is a good investment during these volatile times.

Comments of the Week

👎No

“Gold has gone up exponentially as a result to Trump, as Trump is nuts, its impossible to gage what is going to happen to gold or the market as a whole. He could choke on a cheese Burger and the threat might be gone! “ - kellyo2515

“For better or worse, gold as an investment and/or hedge has never made sense to me...” - callawayguy

“I love the colour, I love the feel when I wear it but I do not love the idea of investing in Gold. I look at all the other investments I could buy in today's market with that money. Maybe I’m a little conservative in my investing but to me I would look at 1] Increase my holdings at reduced cost, 2] Use the money to diversify my portfolio at reduced cost.

Gold is like a politician, you just do not have any idea which side of the question they are going to be on tomorrow or next month. Gold depends on turmoil for its value to rise but what happens when the Orange Iguana is tamed, or the rest of the world settles into a sweet spot where the USA & the Iguana are irrelevant. Gold will drop and your value decreases, your only possible sale is to the guy you bought it from MAYBE! Take advantage of the market in turmoil because the market will always recover, and stronger than ever.” - entender1012

👍Yes

“For a small allocation.” - realtymediaservices

“I have never invested in gold but with today’s political climate I am warming up to investing in something more tangible.” - tomkieselbach446

STAGFLATION?
El-Erian: Recession Risk ‘Uncomfortably High’ 

• Recession risk now near 50%, inflation forecasts climbing

• U.S. growth may drop to 1–1.5%

• Markets underestimating global fallout from tariffs

• Dollar weakness may not last long

Allianz Chief Economic Advisor Mohamed El-Erian has joined the chorus of high-profile voices warning that Trump’s tariffs could tip the U.S. into recession. He says the risk is now “uncomfortably high,” and notes that growth expectations have been dramatically revised lower. From a global markets standpoint, he believes this marks a fundamental shift in sentiment and strategy.

Markets Rethink Everything

According to El-Erian, the U.S. may grow just 1 to 1.5% in 2025 - far below prior projections. With core inflation climbing to 3.5% and the economy flirting with “stall speed,” the risk of a demand-led slowdown is growing. “The first reaction has been concerns about growth,” he said, adding that inflation impacts and dollar dynamics will soon follow. Traders are also reconsidering whether the Fed will deliver the four rate cuts currently priced in.

A Global Contagion Effect

El-Erian warned that if the U.S. slows, other economies may suffer even more. Markets have punished the dollar short-term, but he expects that to reverse as global growth slows faster than in the U.S. His overall message: short-term tariff pain is certain, long-term gain is speculative. The timing, scale, and unpredictability of this trade policy shift makes it difficult for central banks or investors to respond with confidence.

Read the Full Story here.

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THE U.S. ECONOMY
Trump’s Tariffs and the Looming Trumpcession

• Trump’s tariff shock triggers investor panic

• U.S. recession odds now exceed 50%

• Capital Economics slashes S&P 500 forecast

• U.S. consumers face $3,800 average cost increase

Trump’s so-called “Liberation Day” tariffs have sent financial markets into a tailspin and left investors scrambling to assess how bad this could get. Speculation that the President was merely posturing is no longer a thing and it’s been replaced by fear that he’s committed to a hardline trade agenda with major economic consequences. The damage is already piling up, from a collapsing stock market to rising recession probabilities.

Markets and Analysts Sound the Alarm

The shift in tone is unmistakable. Analysts from Capital Economics and others have reversed bullish forecasts, with some now predicting the S&P 500 will struggle to hold 5,500. According to Yale Budget Lab, the average U.S. household is expected to lose about $3,800 in purchasing power due to higher prices. At the same time, markets have pushed U.S. recession odds above 50%, and the “moron risk premium” label is making rounds in investor circles, echoing the UK’s 2022 crisis under Liz Truss.

Policy Chaos and Inflation Risks

Trump’s tariffs aren’t just large, they’re indiscriminate. And that is probably the most unsettling aspect of this whole story. We’re seeing a global fallout, and retaliation is well under way. Trump and his team are banking on higher tariff revenue to offset a ballooning federal deficit, but virtually every economist outside of his direct orbit argue the math doesn’t work. Worse, if Trump follows through with broader levies on goods like pharmaceuticals and lumber, inflation could spike even higher.

My take on this? With consumers caught in the middle, the risk isn’t just economic; it’s political and systemic.

Read the full story here.

THE ECONOMY
Bank of Canada Poised for Deeper Rate Cuts

• Markets now expect 75 bps in BoC rate cuts

• Canada faces wealth loss, job weakness, and trade fallout

• Confidence hit by Trump tariffs and global equity selloff

• Carney’s tariffs raise inflation risk but may temper escalation

Pressure keeps mounting on The Bank of Canada to act as a series of shocks batter the economy; a deepening job market slump, the worst market selloff since 2020, and a trade war escalating rapidly. Traders now see the BoC slashing its key rate to 2.00% by year-end, and odds of a cut at the next meeting now sit at nearly 50/50.

Tariffs and Markets Weigh on Policy

The trigger isn’t just weak jobs data, there’s also the obvious issue of Donald Trump’s aggressive tariff blitz, which has slammed global markets and undermined confidence across Canadian households and businesses. As noted in my economic summary above, Canada’s economy lost 62,000 full-time jobs in March, the worst single-month drop in years, just as the TSX and other global indices plunged in response to “Liberation Day.”

Manulife’s Dominique Lapointe noted that while Canada’s retaliatory tariffs could stoke inflation, they are intentionally measured to prevent further escalation.

Balancing Rate Cuts with Inflation Risk

Prime Minister Carney has already slapped targeted tariffs on U.S. autos and components, and he has signaled more may come if Trump continues his campaign. But some economists warn that retaliation could backfire, especially if inflation spikes and handcuffs the Bank of Canada. For example, Stefane Marion of National Bank says “I know it’s an election campaign now, it might look good to look tough, but the reality, the structure of our economy is not set for retaliation against U.S. tariffs, unfortunately.”

In light of all this, the Bank may be forced to prioritize growth over inflation management, especially as global recession risks rise and the Fed considers its own easing path.

Read the Full Story here.

INTEREST RATES
Powell: Fed Will Wait on Rate Decisions

• Powell expects tariffs to raise inflation, reduce growth

• Fed policy on hold amid high uncertainty

• Markets pricing in up to four rate cuts

• Fed focused on inflation expectations, not political pressure

Federal Reserve Chair Jerome Powell said Friday that the Fed won’t be rushing into policy moves just yet. In the face of rising inflation and Trump’s abnormal tariffs, Powell emphasized the need for clarity before making any rate decisions. His stance stands in sharp contrast with markets, which are aggressively pricing in cuts as early as June.

Tariffs Add Complexity to Fed Outlook

Speaking in Arlington, Powell acknowledged the inflationary threat from Trump’s reciprocal tariffs. He described the economic impact as “significantly larger than expected” and reiterated the Fed’s obligation to keep long-term inflation expectations anchored.

For now, the central bank appears to be in wait-and-see mode, even as Wall Street looks for stimulus.

No Reaction to Political Pressure - Yet

President Trump has come out publicly and is pressuring Powell to cut rates, but the Fed Chair remained diplomatic. “It’s just not appropriate for me,” he said when asked about responding directly. Powell also pointed out that elevated inflation might not be temporary this time, especially with such broad-based tariffs. While the economy remains "in a good place," consumer surveys are showing rising concerns, and that could eventually shift the Fed's stance.

Read the Full Story Here.

OTHER NEWS FROM THE PAST WEEK

TikTok Ban Deadline Extended by Canadian Regulators
The U.S. federal government has granted TikTok an extension to comply with new data rules, delaying the app's potential removal and giving ByteDance more time to address privacy concerns.

Canada Responds to Trump Tariffs with WTO Complaint
Canada has filed a formal complaint with the WTO over Trump’s sweeping tariffs, arguing the levies breach trade agreements and disproportionately target Canadian goods.

Snowbirds Sue Over New Registration Rule
A group of Canadian retirees living abroad is suing Ottawa over a new registration requirement, claiming it violates mobility rights and adds bureaucratic burdens for seasonal residents.

Trump’s Tariff Rates Misleading, Say Economists
Economists are pushing back against Trump’s tariff math, arguing that official rates understate the true cost of levies and that consumers will bear the brunt of the impact.

Air Canada Faces Backlash Over Compensation Delays
Air Canada is under fire for failing to process passenger compensation claims efficiently, as complaints surge over long delays, lack of transparency, and inconsistent reimbursements.

China to Impose 34% Tariff on U.S. Goods
China will introduce a 34% blanket tariff on all U.S. imports starting this month, escalating the trade war and setting the stage for further global retaliation.

Hooters, Red Lobster, TGI Fridays Face Struggles
Casual dining chains like Hooters and Red Lobster are facing a post-pandemic slowdown, with rising costs, changing consumer habits, and declining foot traffic squeezing margins.

During Prohibition in the 1920s, when brewing beer was a no-go, Anheuser-Busch got creative and introduced "Bevo," a non-alcoholic malt beverage. Marketed as "Bevo the Beverage," it became a hit, selling over five million cases annually at its peak. They even built a series of boat-shaped cars called "Bevo Boats" for promotion. Despite its initial success, as bootlegged beer and liquor became more prevalent, Bevo's popularity declined, leading to the end of its production by 1929.

Market Movers

S&P 500 Returns | Week At-a-Glance

TSX Returns | Week At-a-Glance

Top 10 Weekly Gainers

Top 10 Weekly Losers

10 Most Overbought Stocks

10 Most Oversold Stocks

The Relative Strength Indicator (RSI) can provide a signal that suggest a stock is either overbought or oversold.
📈A stock that has an RSI over 70 is considered to be in “overbought” territory. This might suggest that the stock is due for a pullback, however it is not a recommendation to sell.
📉A stock that is trading with an RSI below 30 is considered to be in “oversold” territory. This might suggest that the stock is due for a recovery, however it is not a recommendation to buy. Always perform your own due diligence.

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