Market Watch: September 23 |

On Wednesday, US stocks fell sharply after the Federal Reserve announced, as expected, another increase of 75 basis points. The Fed’s decision will raise the benchmark interest rate to a range of 3 percent to 3.25 percent, the highest level since 2008. US stocks traded higher in the early morning, then fell shortly after the Fed’s announcement. Although they rallied a little later, the indicators slid during the last hour of the session. By Wednesday’s close, the Dow was down 522 points, the Standard & Poor’s was down 66 points, and the Nasdaq had lost 205 points. In Canada, the TSX fell by 184 points due to weak energy sector.

North American stock indices struggled on Thursday as concerns about rising rates and a possible recession in the United States weighed on performance. By Thursday’s close, all four major North American indexes posted modest losses, while 10-year US Treasury yields were flat at 3.705 percent, their biggest one-day gain since June.

NA indicators drift down

For the four trading days covered in this report, the Dow Jones lost 745 points to close at 30,077; The S&P 500 fell 115 points to settle at 3758, while the heavy Nasdaq fell 381 points to close at 11067. In Canada, the TSX lost 383 points to end at 19003.


The US Federal Reserve raised interest rates for the third time in a row by 75 basis points

The Federal Reserve announced on Wednesday that it will raise its target interest rate by three-quarters of a percentage point to restore price stability. The decision was widely expected by markets and raised the federal funds rate – a cumulative rate of 300 basis points year-to-date – to 3.25 per cent. Besides the decision regarding policy rates, the Fed also released its Summary Economic Outlook and accompanying charting chart. The FOMC expects policy rates to rise to 4.4 percent – 4.6 percent by the end of this year and next, respectively, before dropping to 3.9 percent in 2024 and settling at a neutral level (a level that is neither accommodative nor restrictive). ) The long-term. The updated forecast is well above the June forecast of 3.4 percent – 3.8 percent for 2022 and 2023 respectively, and 3.4 percent for 2024.

Moreover, the committee expects growth to be less material this year at 0.2 percent (1.7 percent expected in June), 1.2 percent in 2023 (1.7 percent previously), and 1.7 percent in 2024 (1.9 percent). percent previously). Unemployment is also expected to rise to 3.8 percent this year (3.7 percent previously forecast), and 4.4 percent in 2023 and 2024 from its current level of 3.7 percent. With these restrictive policy settings, the Fed expects the rate of personal consumption expenditures – the preferred measure of inflation – to reach 5.4 per cent this year before declining gradually to 2.8 per cent, 2.3 per cent and 2.0 per cent over the three the coming years. Core PCE inflation, which excludes volatile categories such as food and energy, is expected to be 4.5 percent this year and 3.1 percent, 2.3 percent and 2.1 percent over the next three years.


This report is provided to you for informational purposes only and is not intended to provide personal investment advice. This report does not include or constitute an investment recommendation and does not take into account specific investment objectives, financial circumstances or the specific needs of individual clients. No statements regarding future prospects may be realized. Before working on this material, you should consider whether it is suitable for your particular circumstances and talk to your investment advisor.

The author(s) of the report and the supervisors of the Global Portfolio Advisory Group may own the securities of the companies included in this report.

Scotia Capital Inc. As an “all-in-one” investment firm, we offer a wide range of corporate finance, investment banking, institutional trading, and retail client services and products. As a result, we recognize that there is an inherent conflict of interest in our business since we often represent both parties to the transaction, i.e. the buyer and seller. While we have policies and procedures in place to manage these conflicts, we also disclose some conflicts to you so that you are aware of them. Please note that we may, from time to time, have relationships with the companies discussed in this report.

Global Portfolio Advisory Group prepared this report by analyzing information from various sources. The information obtained in preparing this report may have been obtained from the Equity and Fixed Income Research divisions of the Banking and Global Markets division of Scotiabank. Information can also be obtained from Scotia’s FX and Economics research departments within Scotiabank. In addition to information obtained from members of the Scotiabank Group, information may be obtained from the following third-party sources: Standard & Poor’s, Morningstar, Bloomberg, Credit Suisse AG and Perimeter Markets Inc. and FactSet. The information and opinions in this report have been compiled or accessed from sources believed to be reliable but no representation or warranty, express or implied, is made as to its accuracy or completeness.

While the information provided is believed to be accurate and reliable, Scotia Capital Inc. Neither the Global Portfolio Advisory Group nor any of its affiliates make any representations or warranties, express or implied, as to the accuracy or completeness of this information. Scotia Capital Inc. does not accept Nor shall its affiliates have any liability whatsoever for any direct or consequential loss arising from any use of this report or its contents.

Nothing contained in this report can be relied upon or should be relied upon as promises or representations of the future. The preliminary and estimated financial information contained in this report, if any, is based on certain assumptions and an analysis of information available at the time this information was prepared, which may or may not be correct. No representation, warranty or other guarantee is made that any expectations contained in this report will be fulfilled.

Opinions, estimates and projections expressed in this document are those of the Global Portfolio Advisory Group as of its date and are subject to change without notice. For this reason, it cannot be guaranteed by Bank of Nova Scotia or any of its affiliates, including Scotia Capital Inc., to purchase securities and/or commodity futures; (ii) an offer to do business in any jurisdiction; or (iii) investment advice to any party. The products and services described here are only available where they can be lawfully provided. Scotia Capital Inc. may. and its affiliates and/or their officers, directors or employees may, from time to time, acquire, hold or sell the securities, commodities and/or commodity futures contracts mentioned herein as owner or agent.

Trademarks are property of their respective owners.

Copyright 2022 Scotia Capital Inc. all rights are save.

This report has been distributed by Scotia Capital Inc. A subsidiary of the Bank of Nova Scotia. Scotia Capital Inc. It is a member of the Canadian Investor Protection Fund and the Canadian Investment Regulatory Organization.

® is a registered trademark of Bank of Nova Scotia, used under license. Scotia Wealth Management® consists of a suite of financial services offered by the Bank of Nova Scotia (Scotiabank®); Bank of Nova Scotia Trust Company (Scotiatrust®); Private Investment Adviser, Service 1832 Asset Management L.P.; 1832 Asset Management US Inc. Scotia Wealth Insurance Services Inc. and ScotiaMcLeod®, a division of Scotia Capital Inc. Private banking and international private banking in Canada are provided by Bank of Nova Scotia. Real estate and credit services are provided by the Bank of Nova Scotia Trust Company. Portfolio management is provided by 1832 Asset Management L.P. and 1832 Asset Management US Inc. Insurance services are provided by Scotia Wealth Management Insurance Services Inc. Offered in Canada by Scotia Capital Inc. Financial planning services are provided by Bank of Nova Scotia, 1832 Asset Management L.P., and ScotiaMcLeod, a division of Scotia Capital Inc. Scotia Capital Inc. It is a member of the Canadian Investor Protection Fund and the Investment Industry Regulatory Organization of Canada. Scotia Wealth Insurance Services Inc. is an insurance subsidiary of Scotia Capital Inc. It is a member of the Scotiabank group of companies. When discussing life insurance products, ScotiaMcLeod Consultants act as life insurance agents (Quebec Financial Security Consultants) representing Scotia Wealth Insurance Services Inc.

Scotia Wealth Management consists of a range of financial services provided, in the Bahamas, by Scotiabank (Bahamas) Limited and The Bank of Nova Scotia Trust Company (Bahamas) Limited. International private banking in the Bahamas is provided by Scotiabank (Bahamas) Limited, an entity registered with the Central Bank of the Bahamas. International investment advisory services in the Bahamas are provided by Scotiabank (Bahamas) Limited, an entity registered with the Bahamas Securities Commission. International Wealth Structuring Solutions are offered in the Bahamas by Bank of Nova Scotia Trust (Bahamas) Limited, an entity registered with the Central Bank of the Bahamas.

Scotia Wealth Management consists of international investment advisory services provided, in Barbados, by the Bank of Nova Scotia, Barbados Branch, an entity authorized by the Barbados Financial Services Commission.

Scotia Wealth Management consists of a range of financial services provided, in the Cayman Islands, by Scotiabank & Trust (Cayman) Ltd. International private banking, international investment advisory services and international wealth structuring solutions are provided in the Cayman Islands by Scotiabank & Trust (Cayman) Limited, an entity authorized by the Cayman Islands Monetary Authority.

Scotia’s wealth management consists of private international banking services provided, in Peru, by Scotiabank Peru SAA, an entity overseen by the Peruvian Banking and Insurance Supervisory Authority.

Scotia Wealth Management® in Chile consists of the services provided by Scotia Corredora de Bolsa Chile Limitada (Brokerage) and Scotia Administradora General de Fondos Chile SA (Asset Management), entities supervised by the Comisión para el Mercado Financiero de Chile (Financial Market Commission). ® is a registered trademark of Bank of Nova Scotia, used under license.

Leave a Comment