MARKET OUTLOOK FOR SIA CHARTS

September 2014

Ukraine Crisis Heats Up; North American Markets Stay Cool

 
Pro-Russian Rebels have increased their military stronghold over Ukraine as fighting intensifies in the region. Ukraine’s ambassador to Canada has called for ‘real’ military support to help the country defend its borders as the crisis begins to approach an outright war. Russian separatists are moving on multiple fronts and rumors suggest they have captured strategic ports along the Azov Sea (National Post, 2014).

As one might expect, the iShares Russia Capped Index closed down 2.24% today (August 29, 2014), but markets across North America have stayed calm and cool. The S&P/TSX Composite Index closed the day up 0.43% while the S&P 500 Index locked in a 0.33% gain over yesterday’s closing price. When macro headwinds begin to appear investors often move into safe haven assets to protect their investment portfolios from a possible decline; however, this has yet to play out. The price of gold, generally considered a safe have asset, closed down 0.17% today and has been on a downward trend for the past five days. But in typical crisis fashion, the price of oil is increasing and closed up 1.40% to $95.87 per barrel of crude (Bloomberg, 2014).

In other stock market news, investors are beginning to wonder whether the Federal Reserve may begin raising rates earlier than originally expected. With inflation remaining below the Federal Reserve’s threshold, weekly jobless claims coming in below 300,000, and second quarter GDP revised up to 4.2% the United States economy seems to be chugging along (MarketWatch, 2014). The old adage ‘sell in May and go away’ does not seem to have panned out this year, and market participants continue to be rewarded for staying in the markets. Let us close off the month of August with modest gains and look towards a strong fourth quarter to cap off the year.

Bloomberg. (August 29, 2014). Ukraine’s ambassador to Canada begs for troops to counter Russian invasion. Retrieved from www.bloomberg.com.
MarketWatch – The Wall Street Journal. (August 29, 2014). Economic Calendar.
Retrieved from http://www.marketwatch.com/economy-politics/calendars/economic?link=MW_Nav_EP.
National Post. (August 29, 2014).
Retrieved from http://news.nationalpost.com/2014/08/29/ukraines-ambassador-to-canada-begs-for-troops-to-counter-russian-invasion/.

This newsletter was prepared solely by Bruce Morrison who is a registered representative of HollisWealth™ (a division of Scotia Capital Inc., a member of the Canadian Investor Protection Fund and the Investment Industry Regulatory Organization of Canada). The view and opinions, including any recommendations, expressed in newsletter are those of Bruce Morrison only and not those of HollisWealth. TM Trademark of The Bank of Nova Scotia, used under license. Morrison & Partners Wealth Strategies is a personal trade name of Bruce Morrison.