Hello, and I'm Greg Bonnell. Welcome to my talk live, brought to you by TD Direct Investing.
Coming up on today show, we are going to hear from TD Asset Management's Alex Gorewicz on the potential opportunity in fixed income as we see some signs that the central banks are starting to ease up on those rate hikes and what that could mean for the bond space. TD Asset Management's James Hunter is going to take to the pros and cons of higher rates and bond stocks and then we'll hear from TD Economics Rishi Sondhi on why the housing market may be near the bottom. Plus in today's WebBroker education segment, Nugwa Haruna is going to show us how you can find more information about target date funds using the platform.
Forget all that, let's get you an update on the market.
The Americans were off yesterday for the Thanksgiving holiday. They have 1/2 day trading session. We got about an hour left and that one.
We will start here at home with the TSX Composite Index. It's 20,426, at 82 points.
It's muted given the American holiday in the have trading day today, but we do have some green on the screen, including from one of our major railways, CP rail.
let's check in on that name. We got Canadian Pacific up 1.4%, just a little shy of 109 bucks per share.
Seeing some pressure on the miners today, including Kinross. Let's check in on those shares. At five bucks and $0.
53, you have Kinross down a little more than 3%. South of the border for that short trading session coming off the US thanks giving holiday, less chicken on the S&P 500.
The broad read of the American market is seeing trading a bit muted in terms of volume and it's sort of just, there.
2.6 full points to the upside, that's just sick sticks for the S&P 500. It check in on the tech heavy NASDAQ.
We got a 47 point deficit, nothing too dramatic, just a little shy of half a percent. And Alibaba group, the listed shares of the Chinese e-commerce giant are under pressure today, 7579 will call that, down about 3 1/2%.
That's your market update.
Of course, along with the Thanksgiving holiday comes the unofficial start of theHoliday shopping season, Black Friday.
It's important for retails after the year they've had.
Some of the reports we had this quarter out of the retailers. And Hegel is with us now for larger break down of the issues.
>> Yeah, I mean, when you look at the latest quarterly earnings for some of these names, it's a mixed picture.
Best Buy, for example, they topped Wall Street estimates and they stuck with their holiday quarter outlook. They said Electronics demand has held up despite inflation.
Walmart also beat earnings as well.
Again, they benefited from sort of this value focused spending coming from consumers. As a well as the grocery business, they are sort of clearing some of their unwanted inventory, Nordstrom, Kohl's.
They change the forecast. It it's a mix forecast for the critical holiday season.
>> Was interesting, of course, that the Black Friday sales, obviously, Canada has fully embraced it even though the last several years, this is part of our holiday it shopping tradition as well, they are really hoping for a strong showing after the tough year that we've had and retailers being under inflation pressures. On the other side, if you are the consumer, those inflationary pressures mean that you want to find bargains.
I've made two purchases that were Black Friday sales online. It was because a pair of shoes I already own were 25%. Oh, I like those genes. Oh, there are 20% off. I made the purchase because they were discounting.
Discounting is been part of the problem for these retailers.
>> It's been a big problem.
As you know, big bargains are back in trend now.
people are looking for bargains, big discount.
Of course, discounting for these big retailers come up with a lot more pressure on their profit margins because they have to try to give it if this excess inventory to the got a lower these prices. And we are seeing that from names like Target, Kohl's, Nordstrom, that have actually offered higher markdowns in order to clear their excess inventory. Again, this going to put a lot of pressure on their profit margins.
You mentioned with higher inflation and borrowing costs, people are dealing with these headwinds heading into the holiday shopping season, and so there is intense pressure for retailers to generate sales but again, it's going to be interesting to see how that holds up particularly during this Black Friday and holiday shopping season.
>> You know I haven't heard recently?
I'm going to Google it too. Your member, used to be like, okay, here's Black Friday and here's all the sales and the people lined up at the door. People crashed on the door to get all those deals.
And then he would get cyber Monday on the other side of it.
I'm not sure cyber Monday has the heft anymore.
Remember those two purchases I made?
I didn't set foot anywhere, I ordered on the train.
>> A lot of people had the sales on since October and they've been getting these sales earlier than in the past.
So it's been more spread out and Black Friday and cyber Monday are probably not as big shopping days this year.
>> Yeah, I put cyber Monday and said the search engine and they are sort of much together now.
Black Friday becomes a we can of shopping.
Thanks for that.
> My pleasure.
>> Later on the show, Anthony will join us to look at the latest TD Direct Investing index which gauges sentiment among self-directed investors.
It's been a pretty tough year for investors. Not many places to write out all this volatility, but as central banks get closer to this great hiking cycle, could there be opportunities ahead and bonds? Earlier, I was joined by Alex Gorewicz, or fully manager for active fixed income at TD Asset Management to get her view on what a slower pace of rate hikes could mean for her space.
>> Hopefully, it means more stability. Part of that is because of let's say a slower pace of rate hikes. They are able to do this because inflation appears to be turning the corner and inflation will be the key to watch.
And we think especially in the first quarter, perhaps the first half of the year, that is where we will see the biggest sort of gains in normalization of inflation, in other words,calming that down towards 2%.
We will see more normalization and then that enables bonds to behave more bond like.
> More like bonds.
> More like bonds, that's right.
I mean, it's been a very difficult year for all asset classes, as you alluded to.
And that's because inflation has been not just high but rising.
That's a bad environment for bonds, and that's not what we expect for next year.
>> So we can expect, perhaps, bonds to start behave more like bonds next year as we sort of work our way through inflation and all these rate hikes, can we have some faith again, perhaps, in the 6040 portfolio? I think that called into question this year, because usually like, okay, times of turmoil, maybe my equities are looking great. I got the portion of bonds on my port folio. So I got a bit of safety here, a bit of a haven, but was in haven this year just because the mechanics of why the market was selling off.
>> That's right, but there is an element of that safety component.
Bonds tend to do well in the economy is slowing down and when inflation is not a problem.
Now, the fact inflation was a problem this year and nothing refreshment inflation eventually would lead to a slowdown in growth.
Consumption would have to start slowing down those people would have to ration their budgets toward the necessities, not the nice to haves. And we are starting to see evidence of that happening.
If you look at the quarter over quarter training consumption this year in the US, which is arguably the most resilient economy at the moment, we are seeing that downward trajectory and consumption and that tells us that Partially that inflation has not been kind to the economy, but that looking forward,as companies now will struggle, how to manage those costs that they've incurred, it will likely mean slower economic growth.
And that's usually one bonds do well. So if you couple slower economic growth with less inflation problems for 2023, it should mean bonds can have that safety feature again in a 6040 portfolio.
>> Now, when we take a look at the fixed income environment right now, we are also seeing something that we are not accustomed to seeing, which is yield and fairly substantial yield compared to what we have been used to for a good many years.
>> That's right.
So talking about, you know, bonds being that safety component, you would think, okay, interest rates will go down, so bond prices will be going up.
In other words, you're getting positive returns from fixed income. But even if that doesn't happen, let's say we avoid a recession, let's say things were to move sideways and inflation just comes down, it means stability and interest rates.
It means that we won't see interest rates move materially in one direction or another.
So then they yelled it's really just a proxy for the income that you're getting from the asset class.
And if you look at a typical, let's say, it Canadian bond fund, it's about 5% yield.
Yeah, that's good income that we have not been accustomed to for a decade plus.
>> Now what could knock us off track for a 2023 that's a little more favourable for fixed income then it was this year?
Would it just be the-- I mean, a deeper sense, it's strange, the mechanics here. The central banks have been trying to slow the economy. They think the labor market is too hot. They want to see a bit of pain out there. How does pain translate into fixed income portfolios?
>> Well, so part of the challenge right now is when we talk about the trajectory for inflation going down, but the level still matters.
and the level is still substantially higher, at least at this time, then where central banks are targeting for inflation to be, which is, say, 2%.
The fact that inflation is about that target means that central banks can't cut interest rates.
So if you look at shorter dated bonds, so let's say 0 to 5 years, those yields will likely stay high.
But if we get a deeper recession, longer dated interest rates or longer dated bonds respond more to a mix of both monetary policy as well as economic developments.
So those interest rates will likely come down.
And we've seen a glimpse of that over the last month or so.
As central banks have started slowing the pace of their rate hikes, the front end of yield curves have remained sort of sticky high in terms of interest rates but longer dated interest rates are not responding to economic data coming in, which is pointing towards a slowing in the coming quarters.
And so interest rates have come down at the longer end of the yield curve.
>> There is not complete agreement out there, but with a fairly good idea of what the terminal rate will look like in the cycle for various central banks based on projections, with the central banks of set themselves.
That's just the endpoint of this hiking cycle.
Do you have any idea, going forward, what normal interest rates look like, or will there ever be such a thing again?
>> Yeah, that part target. So the reason that parts harder to gauge is there are a number of factors at the moment that suggest inflation, it could normalize, but it could normalize to a level that's higher than what we've been used to, at least before the pandemic.
So if you look at various geopolitical factors, if we look at the policy response from individual governments after the pandemic and all the global supply chain disruptions, your seeing signs that governments want to build what they call resilience in their economies. So in other words, make sure that we have certain key industries or certain key goods and services that are produced locally that will require a lot of investment involved.
Well, all that investment will very likely mean prices could be stickier or higher in the long run.
And when I say the long run, I mean, we could say anywhere between one or two years looking at.
So even if inflation, as we expect us to normalize in the coming quarters, does come down, the question is, does it come down to 2% or does it come down to something a little bit higher?
And at the moment, the evidence is sort of pointing towards a little bit higher.
If that's the case, it means, sure, interest rates to normalize.
Maybe you don't stay at 45% forever, but will they go back to him to 0%?
That's unlikely in the next couple of years.
That was Alex Gorewicz, portfolio management for active fixed income at TD Asset Management.
Now let's get you updated on some of the top stories in the world business and take a look at how the markets are trading.
Shares of Manchester United are on the move as speculation continues to swirl about a possible sale of the team.
The storied English football club hasn't won a trophy and some five years,and the team's current owners, the Glazer family, has come under criticism for that.
In a statement, the family said it is evaluating strategic alternatives for the business.
The shares are up today 15%.
Activision blizzard is in the spotlight today.
That amid unconfirmed reports the US Federal Trade Commission could attempt to block Microsoft's $69 billion purchase of the videogame company.
Now, the deal would bring Activision titles such as call of duty and Candy crush together with Microsoft Xbox gaming console.
Activision says it's committed to working with regulators to get the deal completed.
Shares of Credit Suisse are skirting new lows, that as the bank deals with massive outflows of capital from its core business units.
Credit Suisse announced this week that clients have pulled almost $90 million US so far in the fourth quarter, with wealth management taking the biggest hit.
Those shares down will 7% at this hour. We check in on the main benchmark indices, we will start here at home on Bay Street with the TSX Composite Index.
83 points the upside, bad gain, little shy of half a percent.
There was the was holiday yesterday and the shortened trading session which has only about 45 minutes left south of the border. Let's check in on the S&P 500.
A bit of green on the screen to the upside, less than two points to the upside, just up for it takes for the S&P 500.
rising interest rates can of course be viewed as a positive for the banking sector, but it hasn't played out that way through 2022. It James HunterI TD Asset Management joined me earlier to discuss.
> When we think about this year, that is mostly how it has played out on a total return basis. The banks are down a few percentage points, the insurers are up a little bit. And so that they're sort of very close to the TSX. And our thesis going into the year would have been that the banks and insurance companies will benefit from rising rates, banks because they have higher profit margins and the insurers because they'll generate more investment income on their investment portfolios. We've seen that in the earnings estimates.
those have risen. Dividends have been really good, 4 to 5% yield and there's been some double-digit dividend increases, which is really great. And the thing that sort of held them back to your question is just valuations of come down a little and recession peers.
So we're really working to that now. But overall, I say the financials have really been holding their own.
>> As they hold their own, what are some of the challenges of a higher rate environment? I think in terms of maybe even just the loan book, we're hearing so much about the Canadian housing market, that was slowed dramatically because borrowing costs are higher.
Has that come to visit the banks at some point?
>> Yeah, if we talk about credit, you have to keep in mind that Canadian banks have about a $3 trillion loan portfolio.
so insignificant, and every year, they have to put aside some of their profits for loans that could go bad. Those are the provisions for credit losses. And those could go higher as we get closer and closer to this economic recession that we might go into.
The thing that's really been helping them offset this has been a higher margin. There's been really good revenue growth.
They benefit from the higher interest rates. There's been pretty good expense control as well. So yeah, there is this give and take between provisions and the revenue and expense side of things that has been pretty strong this year.
>> What do we need to think about for 2023? Right now, it seems that a lot of people are baking in a recession and the big debate becomes, is it a deep recession? Is it a shallow recession? I think we were hearing just in a lunchtime chat from the deputy senior deputy governor of the Bank of Canada saying, you know, they feel the moves they made so far to raise borrowing costs are working. But, you know, to avoid a hard landing, that's never wants, right?
So a sort of soft landing, in that environment, do the banks end up having a favourable situation with, you know, nice interest margins, but not polluting of provisions to try to cover bad loans?
>> Yeah. So that I situation is basically what played at this year where you had the revenue growth really be there to offset the increase in provisions which we are starting to see now. It showed up a little bit in Q3 and will probably be something we'll be seeing in Q4 as well.
So I think that's the good part of the story that's happening this year and next year, there are more risks around that part of the story where the revenue growth may not be enough to offset the increase in provisions.
And so that's what investors are really grappling with.
I think what we sort of think is that there is going to be a mild recession. And then the question about how deep or shallow it is will influence sort of how positive are not positive you would be on the various stocks in the financial sector.
>> What is it look like for insurance companies, life goes in this environment as well?
I mean, that's a great rundown on the banks and other business performance and what it means higher rates.
What about some of those other names?
>> Okay, so the insurance sector, it's actually quite interesting.
You got to keep in mind, there's two different buckets to it.
There's the property and the casualty insurers, and then there's the life insurers. The PNC Insurers have had a really good year. And the reason is because they've got inflationary pricing power. If you think about having an insurance policy for your home or your car, you don't have you don't have a choice. You have to have that. So if the insurer increases their rates by five or 10% or more because of inflation, you're going to pay. And that's resulted in higher earnings this year. And that's that's been really good for those stocks.
The Life Co's, they haven't been not quite as good, but reasonably resilient given all of the sort of difficulties we've had this year.
Two things to keep in mind would be that they have a lot of business in Asia.
So for Manulife and for some life, the slowdown in insurance sales has been a bit of a headwind as their being, you know, zero COVID policies in a part of the world. And the other part of it is an accounting transition.
Not quite as exciting talk about, but there's going to be less earnings and is going to be less book value last year, next year. And so the insurance companies are just having to let investors know that. And we've needed a little bit of time to digest that new information.
>> And I think about the life company side of it, obviously they have obligations that are long-term, long-term liabilities.
And it felt like they had been in such a low rate environment foso long.
We did see these banks move into other areas because they realized you were going to get that kind of return in the bond market. Are these things changing now?
I mean, it's been a dramatic rise in interest rates over this year. But does this take the life codes anywhere close to where they used to be,how the business model used to be?
>>Profile of the insurers. As you mentioned that the year liability profile quite long and that means that their assets are also pretty long duration.
So every year that goes on where rates are a little bit higher or even hold at these levels, there will be a little more investment income flowing through the earnings profiles of the lead company.
It just doesn't happen in order to look again at the bank.
It takes a couple of years. So I think this will be a theme that will probably help them think couple of years if rates stay at higher levels for longer periods of time.
>> Touch on the weakness of the housing market a little bit.
We know the credit runs in cycles as well. What we didn't think about in terms of credit quality heading into 2023?
>> But we need to think about in terms of credit quality it is sort of three things. The three things I think about are the unemployment rate and housing prices and commodity prices.
Those of the three big factors that would go into the economic forecast that really drive provisions and credit.
If you think if you think about the employment rate, it's been rocksolid so far.
it's hovering in the sort of 5% range in Canada, which is low.
That's really good for credit.
It means that people have their jobs and can pay their bills.
So that's a supportive factor.
The thing that is starting to weigh on the outlook is the decline in housing prices. As that happens, people don't have as much confidence.
It happening because mortgage rates are going up.
That sort of makes the budget a little tighter.
> That was James Hunter, banking and insurance analyst at TD Asset Management.
Let's get to her educational segment of the day.
Target date funds are one asset class investors may consider using and WebBroker has tools I'll be research the space. Joining us now with more is Nugwa Haruna, Senior client education instructor at TD Direct Investing.
Nugwa, always great to have you back on the show. Walk us through what we mean by target date funds?
>> Right. So typically, when an investor starts off on their investing journey, that investor might have an investment plan which would include a time horizon as well as risk tolerance. So as investors you typically have a longer time horizon may take on riskier assets.
In terms of asset allocation, they may have more equities and fixed income. But as they move closer to their time horizon or their goal, they may shift what that asset makes in their portfolio looks like.
Some investors in order to do this may have to do a lot of rebalancing in reevaluating the portfolio and some people just don't have the time or the knowledge.
And so that's where target date investment funds come into play. So these are investment funds created by fund managers and the idea behind these funds is that they have an expiry date. Is it 2030, 2035, were the fund managers the one who takes care of changing what the asset mix waiting is in that portfolio.
So is going to WebBroker and I'll show investors where they can actually find target dated funds based on what their time horizon would be. Once in WebBroker, an investor click on research. Under investments, we are going to go to ETFs.
So once here, I'm going to scroll down and we are going to use one of my favourite tools, our mini screener tool. It is so where would you click on ETF category.
And once we are here, you can see there are different time frames for target date funds. We will select any target date funds that have more than 13 years out and we are we to view the five matches.
So once you do that, the investor is able to see these different target dated funds, ranging from ones that have a target date of 2040 all the way to 2060. So investors can use this for their goals.
They can also do some deep digging to see what the asset mix these ones are holding, what that looks like.
I will mention one more thing about target date funds.
It's that when you are thinking about target date funds, you have to realize as an investor that it takes away from all the flexibility that the investor does have when they are holding me securities.
But on the other hand, it does allow investors to practice something that's more of an autopilot function and so it lets the investor will set and forget what that looks like.
They can sit back and relax until their investment goal is reached.
>. Using self as always. Thanks.
>> Thank you.
>> Our thanks to Nugwa Haruna, Senior client education instructor at TD Direct Investing.
And make sure to check out the learning centre in WebBroker for more educational videos, live interactive master classes and some upcoming webinars.
rising mortgage rates have weighed on home prices and sales across this country, but with some signs of inflation easing,And the pace of rate hikes beginning to slow, were we going to be going forward? Rishi Sondhi, TD economist says we might be close to the bottom for the housing market.
>> TD Economics thinks that a lot of the downside and housing with respect to sales and prices are taking place.
we did get October data last week showing resales and prices in the retail market.
Home sales actually increased on a month on month basis in October, which is the first time and I think seven or eight months that's taken place.
That's kind of a hopeful sign for some individuals like homeowners and the like. Prices were still down, unfortunately.
But we did have, again, we did have sales increase. And when you look at sales, they are trending at levels last seen at 2012. They are down about 40% from their February level.
They undershot what typically you'd see, sales levels you would typically see if you benchmarked them against fundamentals like income and housing supply.
So there some signs that we are nearing a bottom. I wouldn't say we are at a bottom as a speaker at the moment, but there could be some signs that we are, that the worst is behind us with respect to the down trend in sales and prices.
> As part of the hard part of this where we are on the cycle, people simply adjusting to a new reality? We've seen in the housing market the last few years, whatever there is someone regulatory change or any change the landscape the cause people to go on the sidelines for a moment, you want to figure out what's going on before he may, for most people, including me, the biggest financial decision in your life?
>> Yeah, it's quite difficult figure.
In this case, the regulatory change that's really sparking the market… I don't think it's any third great mystery to anybody, these interest rates, they've been rising since March. Banking and housing has been on a very aggressive rate hiking campaign. And that's really done the trick with respect to really deteriorating affordability and really weighing all the demand and the prices. This is just on the other side of what we saw during the course of the pandemic.
If I remember, over much of the pandemic, prices ran up across Canada.
Average prices ran up by about 46% from the bottom of the beginning of the pandemic to the top. And that was with rock-bottom interest rates.
Another interest rates are normalizing, some downturn in prices is to be expected.
So that's what we're working through at the moment.
And again, the main government trigger, of course, has been interest rate.
>> It's interesting for all dynamics at play in the market. Of course, we know the borrowing costs are higher and we see in the sales come off and the prices come off, but there's no long supply either. You look at some of these major markets and they are pretty supply constraint.
>> When changes that dynamic, people wanting to list their homes?
>> Yeah, well, first I'll talk about what we expect.
We expect, there has been some, I'll call it saltiness in the listings. Listings have fallen on average since February, or, sorry, March, which is when the market started to correct.
So you listings have been subdued, and that's what one would typically expect when the markets go south.
Sales go down.
Prices go down.
Not a lot of people to lose their homes and that sort of environment, if you don't have to.
Of course, there'll be some.
What could change that perhaps his interest rates, higher interest rates, rising borrowing costs, putting some pressure on people who perhaps are a little bit overstretched with respect to purchases, maybe investors or the like.
And they are forced into listing their homes because of the increase in carrying costs, particularly if they took a variable rate mortgage, of course, which is levered to the Bank of Canada's interest rate. And that's feeling up quite aggressively.
Even if they have a fixed mortgage, that's renewing a much higher rate.
Some financial pressure could lead to some people to list their properties. But so far, I don't want to say good on that front.
But we haven't seen evidence of that so far.
So far, listings are quite subdued.
They picked up in October but are still below their long-run average.
>> Is there psychology at play on that side of it as well when you think about people trying to wrap their heads around what's happening in the market now if you want to enter it as a buyer?
But if you want to enter it as a seller, anecdotally, years when people talk about the fact that they are trying to match those two sides.
And the seller saying, wait a minute, my house was worth 1.2 million just a couple of months ago.
There's no way of selling for less than that. When the buyer side, there saying, listen, the market has changed and you can't find a middle ground of agreement.
>> Oh, I think that's, even more than anecdotally, I think that's is taking place.
There's a lot of listings that are sitting on the market for months on end.
They are not selling.
And that might be a case of all called sort of unrealistic expectations on the part of the seller.
At the same time, the buyer may be saying, okay, well there's lots, there's more supply in the market now.
There's less bidders.
There is less heat on the market, so I can afford to take my time and then look around.
so I think of the dynamic is definitely a play in the moment.
>> Now of course, big dynamic that is at play in Canada when it comes the housing market is immigration levels.
We have very robust levels, we have very robust targets, and of course, when people come to make Canada their home, they need to put a roof over their head.
Those that one of the things that going forward can at least keep the floor under demand?
> Oh, definitely.
I mean that's why we think that prices will eventually rise.
Once the market adjusts to this rate hike cycle, I guess your little bit more positive, I would say, or we expect sales and prices to increase after sort of this, again, market adjusts to this rate hike cycle.
And a big reason for that is because of this robust population growth.
Now, when immigrants come to the country, they disproportionally tend to rent. So that helps the condo market and rents in the condo space.
The little people who bought condos and investors alike. But ultimately these investors, they then transition their demand from the rental market to the ownership market with a bit of a leg. But that's there.
So that makes us more confident that sales and prices will continue to move higher after the market adjusts to this rate hike cycle.
>> The other just academic that this is if someone can sitting on the sidelines of a housing market or even wondering to the pandemic with the run-up in prices, how do even afford to get into the housing market, so they see the headline.
They see prices a pullback in this presenter that present.
And sales will pullback.
At the same time, Broca's or higher.
Had the dynamics change in favour of afford ability at all for this?
>> It's gotten merge. We do our affordability calculations and our math at TD Economics, we see that afford ability has improved a little bit, but not much because of the factors that you mention.
Prices are coming off the low, but at the same time it's being offset by higher interest rates.
So virtually, somebody who's perhaps a first-time homebuyer may not see much relief with respect when they initially decide to jump into the market.
>> Longer-term, you do worry about the next generation try to get into housing market.
A play with the inflation cog later on the central bank website. What I paid, what is the market value now?
Obviously three different gave when I started 18 years ago getting into the housing market.
What in the housing market needs to happen to bring affordability to these people?
>> I think one of the big answers there is supplied, particularly with the population expected to grow as much as it has.
It we've seen higher interest rates.
They've lowered prices, and at the same time, that overall affordability better, that overall monthly payment is still being inflated by these higher interest rates. The higher interest rates are bringing down the price at the same time keeping that monthly payment elevated.
So some of the organizations like Siemens, CMH see, they've done some estimations around that and basically at the conclusion of a lot of this analysis, including ours, is that were supply will be needed in the market, particularly not only to keep up with population growth but to enhance affordability moving forward.
>> That was Rishi Sondhi, economist of TD Bank.
Let's check in on the markets, got less than half an hour left south of the border on their shortened trading day but we are open for business in Toronto to trade stocks right up until the closing bells of the usual time.
Let's take a look at the S&P TSX Composite Index, up about 70 points, almost 1/3 of a percent.
The volunteer light given the fact that Americans took off yesterday for the Thanksgiving holiday and are only doing half day today. Some names are on the move.
Let's check in on Enbridge, the big pipeline company.
It's up a modest $0.41 per share, three quarters of a percent.
Shopify, as we saw earlier, somebody moving out of the tech space as evidenced by the NASDAQ. Shopify's down to the tune of about 2%.
South of the border, let's chicken on the S&P 500 and see what's happening on a broader read of the American market with lower trading volumes coming off the holiday, they are two points the upside, 56.
The tech heavy NASDAQ under some pressure today, down 51 points.
Let's chicken on Manchester United, all these rumours about a possible sale of the team that just has and perform to its historic expectations has some money moving in that direction, they are up about 15%.
Every month, TD Direct Investing puts together a sentiment survey on how self-directed investors are feeling about the markets. Our Anthony Okolie has been digging into the numbers and brings them to us now.
in October, it was -26.
That puts sentiment in bearish territory and is a considerable improvement from the previous month.
It was up 30 points month over month from September's low of -56.
Member the DII score ranges from 100 being most bullish 2-100 being most bearish. When we dig into the numbers, there some interesting insights here. It is sothe difference… Short-term investors and long-term investors, they are more the buy-and-hold type. The sentiment gap between these two trading styles actually why did substantially in October.
Active traders sentiment rose about 24 points to +1, that puts their sentiment about neutral.
For long-term investors, there score raised six points to -26 which is still bearish.
The gap widened to 25 points between the two trading styles.
Meanwhile active traders tended to favour tech or tech like stocks with Tesla, Shopify and Amazon among the top bought names by active traders last month.
For long-term investors, they lead towards energy and financials with the Bank of Nova Scotia, Enbridge and Algonquin power utilities among the top bought stocks in October.
Finally, while sentiment rules across all age groups, baby boomers sell the biggest improvement with a 10 point month over month gain but they still ended up in bearish territory with a score of -60. Meanwhile, Gen Z and millennial's were again the most optimistic group as sentiment rose 3 points to neutral last month.
>> I always find this survey so interesting because it breaks down interestingly across groups and by sector.
If you look at it through that lens, what was it like?
>> There was a lot of optimism.
In energy, many Canadians decide to buy local.
We have a big energy sector in Alberta. On the flipside, the bottom three sectors were financials, discretionary and communications. Specifically with communications and consumer discretionary, they seem to be pulled out owned by some of the tech darlings such as Tesla, Amazon and Google.
In the previous quarter, both Google and Amazon showed a slowdown as cloud and advertising growth stalled.
>> Great stuff as always.
>> My pleasure.
>> MoneyTalk's Anthony Okolie. Stay tuned.
On Monday, Alfred Li, portfolio manager at TD Asset Management will be our guest taking your questions about the Chinese economy and markets.
You don't have to wait until the show begins. You can get a head start with your questions. Just email firstname.lastname@example.org. From me and Anthony and everyone here MoneyTalk Live, thanks for watching all week, and we will see you next week.