2023 First quarter market review

Your Money Team with Jacob Gaudet

The year began with some positives for equities and interest rates, in spite of volatility midway through the quarter

Equity markets began the first quarter of 2023 on a high note. Despite volatility chipping away at equity gains, markets finished the quarter higher, with stocks from the major indices registering positive gains.

In general, corporate and government bond yields fell during the quarter, as investors started to price in future interest rate cuts. The spread between the two-year rates in Canada and the U.S. narrowed towards the end of the quarter, which is a positive sign for the strength of the loonie.

The U.S. Federal Reserve maintained its hiking policy through the quarter but hinted at a possible pause in March, while the Bank of Canada indicated a pause following its hike of 25 basis points in January.

Canadian Equities

The S&P/TSX Composite Index was positive for the quarter, rallying 3.69% in the first quarter, driven by positive contributions from the information technology and materials sectors. All sectors were positive for the quarter except health care and energy. Reversing course from last year, Shopify rallied, driving performance in information technology in Q1. Other tech names rebounding were OpenText and Blackberry, increasing 29.94% and 40.59% respectively. Materials gained, due to the appreciation in gold globally Despite headline risk in the banking sector, Canadian financials finished the quarter positive (even with a 5.71% drop in March). benchmark for stocks rose 7.03% (in U.S. dollars), with the information technology, telecommunications and consumer discretionary sectors the main contributors, while financials and energy stocks lagged. U.S. financials declined by 6% for the quarter, due to banking concerns that were quickly averted by strong and decisive action by the U S Federal Reserve, FDIC and U S Treasury Information technology stocks gained 21.5% (in U.S. dollars) for the quarter, with Nvidia returning 90.07%, contributing greatly to the sector's rebound. Consumer discretionary equities increased 15.8% in the quarter, as cruise lines saw revenue growth more than quadruple from a year prior

U.S. equities

The S&P 500 Index gained through the first quarter of 2023. The U.S.

Continued on page 28

Despite the short-term volatility, markets ended the first quarter higher.

International equities

Even considering the failure of Credit Suisse and poor performance from Europe's financials, the Europe, Australasia and Far East (EAFE) Index had a great quarter once again, rising by 7.65%.

The U.K. index (the FTSE 100) was the laggard in the international markets, showing a return of only 2.42%.

In general, Europe was much stronger; the EuroStoxx 50 Index had a return of 13 74%, on the back of better-thanexpected economic data and attractive valuations

Fixed income

Barclay's Global Aggregate Bond Index returned 3.01%, and Canada's Government Bond Index 3 37%, a very strong quarter for fixed income

Even corporate bond results were impressive; the ICE Bank of America Corporate Bond Index returned 3.45% in U.S. dollars, and the ICE US High Yield Composite returned 3.72%.

These results are mostly explained by the drop in bond rates, following the banking crisis that happened in March.

Looking ahead to the rest of the year

While we still expect to see a recession in the coming quarters or in early 2024, with a strong labour market in North America it’s our expectation that it will be a mild one.

In spite of a potential recession, there are opportunities for investments in the market right now. The outlook for 2023 is expected to be one of peaks and troughs, with inflation and interest rates near their peak and equity markets possibly near a trough, due to a focus on valuations.

Diversification across asset classes will provide more upside potential going forward. While credit markets have tightened (increasing the odds of a recession happening faster than some expected), there are also some positive signs, especially in international markets

Jacob Gaudet is an Associate Consultant on the wealth advisory team Gaudet Group Private Wealth Management. He helps clients get more out of their money, so they can get more out of life. Jacob focuses on six key areas: Investment, Retirement, Mortgage Planning, Estate, Tax and Insurance Planning. With more than 60 years of combined experience, Gaudet Group Private Wealth Management is committed to making clients’ interests their top priority. Do you have questions you’d like Jacob to answer? Email him at jacob.gaudet@igpwm.ca.

Investors Group Financial Services Inc

This commentary is published by IG Wealth Management and is provided as a general source of information. It is not intended as a solicitation to buy or sell specific investments, or to provide tax, legal or investment advice or as an endorsement of any investment. Some of the securities mentioned may be owned by IG Wealth Management or its mutual funds, or by portfolios managed by our external advisors. Every effort has been made to ensure that the material contained in the commentary is accurate at the time of publication, however, IG Wealth Management cannot guarantee the accuracy or the completeness of such material and accepts no responsibility for any loss arising from any use of or reliance on the information contained herein. Investment products and services are offered through Investors Group Financial Services Inc. (in Québec, a Financial Services firm) and Investors Group Securities Inc. (in Québec, a firm in Financial Planning). Investors Group Securities Inc. is a member of the Canadian Investor Protection Fund. Commissions, fees and expenses may be associated with mutual fund investments. Read the prospectus before investing. Mutual funds are not guaranteed, values change frequently and past performance may not be repeated. This document may include forward-looking statements based on certain assumptions and reflect current expectations. Forward-looking statements are not guarantees of future performance and risks and uncertainties often cause actual results to differ materially from forward-looking information or expectations. Some of these risks are changes to or volatility in the economy, politics, securities markets, interest rates, currency exchange rates, business competition, capital markets, technology, laws, or when catastrophic events occur. Do not place undue reliance on forward-looking information. In addition, any statement about companies is not an endorsement or recommendation to buy or sell any security Trademarks, including IG Wealth Management, are owned by IGM Financial Inc. and licensed to its subsidiary corporations.

© Copyright 2023 Investors Group Inc. Reproduction or distribution of this commentary in any manner without the express written consent of IG Wealth Management is strictly prohibited.

Aries: March 21 - April 19 (Fire) –Do not go out of your way to impress people this week, spend your free time trying to find a way to impress yourself. If you are single you will find that you will attract some great quality love interests this week. If you are in a relationship your lover will be pointing out all your attractive features

Taurus: April 20 - May 20 (Earth) –

You seem to be spinning in a circle You need to have a serious discussion at work about what your true role is Then you need to go home and have the same conversation with yourself about the direction your life is heading. Only then will you finally see things more clearly at the end of the week.

Gemini: May 21 - June 20 (Air) – You have a lot of people showing you love and support this week. You are being guided to a bigger purpose in work and love, follow all these signs and listen to all the good advice being given to you from those people who really show that they care about your happiness

Cancer: June 21 – July 22 22 (Water) –This week will be good for you mentally You will be finding a way to balance yourself in love, work and health Put your health first and you will find great peace by the end of the week. You will receive some surprising news that leaves you unsure how to react, so take time to process your feelings before you react

Leo: July 23 - August 22 (Fire) –

You seem to be able to give the best advice this week, but by mid week you will be the one seeking advice from someone you trust You should take this advice because you are really on a path of self-destruction By the weekend you need to find a way to express all you want and need from work.

Virgo: August 23 - September 22 (Earth) – You are starting to feel the need to have a serious commitment in your life Do not settle in love now, look for your perfect match You have the energy this week to attract the right person Do not let self doubt hold you back from all you deserve A friend asks you for a favour this weekend, do it

Libra: September 23 - October 22

(Air) - You will be seeing opportunities in everything and everyone around you. If you are single,It is time to put yourself out there again and if you are not then it's time to spice things up in the bedroom You are going to feel like you may want to quit work this week more than once, do not make any choices till you are less emotional

Scorpio: October 23 - November 21

(Water) – You are easily triggered, beware of this and tread lightly If you feel angered for little to no reason then put yourself on time out You do need space from loved ones and from your work But you will be settled and up for partying by the weekend.

Sagittarius: November 22 - December 21 (Fire) – You will be taking back your control this week. You will have difficult conversations with loved ones and at work, this is great to clear the air and to set you up for a great week You will be planning an epic vacation this summer, all you need to decide now is who do you want to come with you?

Capricorn: December 22 - January 19

(Earth) – You have a go with the flow type of attitude You have been super focused at work lately and this week you would like to focus on your family and all those you love Make plans to check in on all the people you care about and plan a night to go out and have some fun.

Aquarius: January 20 – February 18 (Air) – People are crushing on you They are coming at you from the most random places You are ready for love and ready for a greater commitment. You choose to focus on yourself this week and you will be ready to make some big changes by the end of the week

Pisces: February 19 - March 20 (Water) – You are in the energy field to attract a soul mate. Could turn out to be a lover or could just be a forever friend, either way you feel like you have known this person your whole life This a gift to you, do not let it pass you by because you over analyze this encounter as being weird

Horoscopes with Tina Graziano Energy Reader

Tina Graziano was born an energy reader. She uses her gifts to heal and guide others as a life coach. If you need support and insight in life, contact Tina for an energy reading directly online at https://www.facebook.com/ Tina.Graziano.Energy.Reader /?ref=page_internal