Equities staged a broad-based post-election rally in November. The S&P/TSX Composite Index closed out the month at an all-time high as it recorded its fifth consecutive monthly gain. The S&P 500 also ended November at an all-time high and posted its best monthly performance of 2024.

Canada’s benchmark index was 6.2% higher in November, as eight of its underlying sectors were positive during the month, led by a 28.2% gain for information technology. Telecommunication services was the worst-performing sector, with a 7.1% loss. Small-cap stocks, as measured by the S&P/TSX SmallCap Index, rose 2.5% for the month.

The U.S. dollar appreciated 0.5% versus the loonie in November, increasing returns of foreign markets from a Canadian investor’s standpoint. Note that all returns in this paragraph are in CAD terms. U.S.-based stocks, as measured by the S&P 500 Index, rose 6.3% in November. All the benchmark’s underlying sectors were in the green during the month with consumer discretionary and financials rising 13.9% and 10.8%, respectively. International stocks, as measured by the FTSE Developed ex-US Index, eked out a gain of 0.4% during the month, while emerging markets stocks shed 2.3%.

Canadian investment grade bonds, as measured by the FTSE Canada Universe Bond Index, rose 1.7% during the month, while the key global investment grade bond benchmark gained 0.3%. Global high-yield issues gained 1.2%.

Turning to commodities, natural gas prices surged 24.2% during the month, while the price of a barrel of crude oil fell 1.8%. Gold, silver and copper had a negative month, falling 3.4%, 6.4% and 6.0%, respectively. Inflation in Canada increased to 2.0% year-over-year in October. The acceleration was due to base-year effects on gasoline prices. The Canadian economy added 15,000 jobs in October, as the nation’s unemployment rate was unchanged at 6.5%. The Canadian economy grew by 1.0% in Q3 2024, below the Bank of Canada’s projection of 1.5%. The Bank of Canada is set to make its next rate announcement on December 11.

U.S. nonfarm payrolls grew by 12,000 in October, maintaining the unemployment rate at 4.1%. The consumer price index rose 0.2% for the month, putting the 12-month inflation rate at 2.6%. Shelter and used cars contributed more to the monthly price increase than expected. The Federal Open Market Committee opted for a 25 basis point cut at its November meeting, bringing the federal funds rate down to 4.50–4.75%.

Content sourced from Bloomberg; data as at November 30, 2024.

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