Global risk assets bounced back sharply buoyed by better-than-expected corporate earnings, progress on the U.S. fiscal stimulus front, and a continued downward trend in new COVID-19 cases. Government bond yields climbed as increased prospects for a large scale fiscal package raised global economic growth expectations. Crude oil prices strengthened while gold prices waned.
The S&P/TSX Composite Index strengthened as all sectors advanced. Technology and health care posted double-digit gains while rate-sensitive sectors underperformed. Government bond yields rose, despite a sharp rise in job losses last month, as manufacturing activity remained solid and home sales continued to post record growth.
The S&P 500 Index (C$) strengthened as all sectors advanced with energy, communications, and financials leading the way. Rate-sensitive sectors underperformed. U.S. treasury yields climbed as manufacturing and services activity remained in expansionary territory and a sluggish jobs report fueled the case for new fiscal spending.
The MSCI EAFE Index (C$) strengthened as all sectors advanced except for energy and staples. Consumer discretionary, financials, and communications outperformed. The U.K. underperformed as less dovish comments from the Bank of England tempered expectations for a future interest-rate cut. Asian markets strongly outperformed.