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(music) HELLO I'M GREG BONNELL AND WELCOME TO MONEYTALK LIVE WHICH IS BROUGHT TO YOU BY TD DIRECT INVESTING. IT'S A NEW PROGRAM BROADCAST DAILY ON WEBBROKER. EVERY DAY I'LL BE JOINED BY GUESTS FROM ACROSS TD, MANY OF WHOM YOU'LL ONLY SEE HERE. WE'LL TAKE YOU THROUGH WHAT'S MOVING THE MARKETS AND ANSWER YOUR QUESTIONS ABOUT INVESTING. COMING UP ON TODAY'S SHOW: WITH ENERGY COSTS PRESSURING HOUSEHOLDS, SOME ARE BLAMING THE RISE OF "ESG INVESTING" FOR THE PRICE THEY'RE PAYING AT THE PUMP. WE'LL BE JOINED BY TD ASSET MANAGEMENT'S PRITI SHOW-KEEN TO DISCUSS WHY IT'S MORE COMPLICATED THAN THAT. AND IN TODAY'S WEB-BROKER EDUCATION SEGMENT CAITLIN CORMIER WILL SHOW US HOW YOU CAN USE THE PLATFORM TO FIND INFORMATION ON POTENTIAL INVESTMENTS THAT FIT THE ESG CRITERIA AND HERE'S HOW YOU CAN GET IN TOUCH WITH US, JUST EMAIL MONEY-TALK-LIVE AT TD DOT COM OR.. FILL OUT THE VIEWER RESPONSE BOX UNDER THE VIDEO PLAYER ON WEBBROKER AND BEFORE WE GET TO OUR GUEST TODAY LET'S GET YOU AN UPDATE ON THE MARKETS A bit of a mixed fixture in North American equity. TSX has managed to hold a positive territory with almost a full percent. It's really the energy names and some of the miners that are doing the heavy lifting today on Bay Street. Among the most actively traded names, Crescent point energy among them. Almost 9 bucks and $0.42 a share. … Right now though, a little lower than eight points. For a gain of almost a little more than 1/5 of a percentage. Some other energy names working in favour of Wall Street as well in the technology trade seems a little bit mixed. You have the NASDAQ 100. Pretty much flat on the session right now. As we see energy on both sides of the border showing some strength. Let's check in on Exxon. And that's her market update. THE PRICE OF OIL AND GAS SURGED WHEN RUSSIA INVADED UKRAINE. BUT SOME HAVE SUGGESTED THE REAL CUPPRIT FOR HIGHER PRICES MIGHT BE THE RISE OF ENVIRONMENTAL, SOCIAL, GOVERNANCE INVESTING. WELL, OUR FEATURE GUEST TODAY SAYS ITS ACTUALLY A LITTLE MORE COMPLICATED THAN THAT. JOINING US NOW IS PRITI SHOW-KEEN, HEAD OF ESG ENGAGEMENT AT TD ASSET MANAGEMENT. Great to have you on the program. A fascinating topic. I'm eager to jump into it. Because of course in this environment of high inflation and high energy prices, some people have pointed the finger at ESG. What's actually happening there? >> Thanks Greg. Thanks for having me here. I think we know the overemphasis on ESG might be a little bit misplaced because there have been many factors that have been contributing to inflation and high prices. The primary factor being quantitative easing that we saw over the pandemic. The pandemic itself created a lot of problems with the supply chain issues. There are public policies attached to energy transition which is part of the factor. But also, we observe markets and political developments quite closely and the fact is that there is a sentiment in the market that there has been underinvestment in the oil and gas sector. Some of the commodity sectors as well which seemed to be carbon intensive. The fact is that because of that underinvestment, we are seeing not only a demand which is pretty strong and will continue to be strong, in the short to medium term, but we are also seeing supply crunches. And the Ukraine/Russia conflict has been a contributive factor to that. The timing of Putin's conflict could not be worse because there is a very tight demand and supply equation in the oil and gas commodities. So, not only has it contributed to higher commodity prices, Energy fits into everything we do in terms of activity. If the gas and oil prices go up, everything else goes up. >> Has not been the trickiest part of this? Even before the Russia/Ukraine conflict there was this feeling that we were getting the transition right. Or it could be a bumpy transition. As we look 10, 20, 1520 years in the future, your single shift in energy sources. But the fear in the near term that we weren't getting the mix right? >> It's very challenging from an energy transition perspective. I think the climate objectives are definitely challenged. The fact is short-term priorities will always overrule long-term objectives. … In Germany, for example is working on securing its energy needs for the winter. The G-7 leaders are meeting as we speak. The fact that this energy security will trump energy transition in the short to medium term, as I mentioned, it's something that will be at the top of mind for all political leaders going forward in the next 22 years. >> When it comes to big, publicly traded names, obviously with their objectives when it comes to ESG and trying to abide by those standards, they might be amassing assets considered to be ESG friendly. You raise an interesting point also. Someone watching the fact that it's okay if you divest yourself of these parts of your company… Where are they going? Are they going to the most responsible places? >> It's called brown spinning, the term for it now. The fact is that a number of larger corporations have committed to net zero and have transition plans. With oil prices being extremely strong, it's easier, low hanging fruit to spin off some of the more carbon intensive assets. According to some of the numbers we are seeing, 64% of asset sales within the fossil fuel sector, going from public to private hands. And it creates a little bit of an interesting challenge because, you know, we are believers in the, you know, manage phaseout admissions. So divestment may be playing a bit of a negative hand in reductions. And we don't fully understand what it will do to the admission profile of the economic activity globally going forward. So, I think Canadian oil and gas sectors seem to be in a good place from that perspective because we have major players who have very high levels of commitment. And they are rather our approach of engagement with them, having that dialogue and discussion, having a management phaseout approach which is more responsible in our view as opposed to selling the assets to perhaps, players were not is responsible. >> It almost sounds like it would be as important if you were doing an ESG screen is an investor, not just to say that it's good that the company has divested of those assets. Knowing exactly how they did it. Perhaps becoming part of the plan going forward? Saying "I don't like the way you divested yourself about that asset?" >> I think it is an important criteria to pay attention to. It's not just about de-carbonized in your portfolios, it's about decolonizing the economy. For D carbonized in the economy, it's more effective to be at the table with the company that have the carbon footprint as opposed to just divesting out of those assets and not having oversight of that. > You talked about how in the near term, obviously energy security is going to trump ESG concerns. Longer-term, is there a way for those two things to work together? >> I believe so. I think you know the sentiment of underinvestment in energy. It is across the board. Energy sources are not… The fossil fuel energy. Many other resources as well. The investment needs to happen across the board, I think. According to the International energy agency, there was around an estimated $3 trillion that needs to be invested in ever in energy transition every cycle year. That includes carbon capture, solar, wind, that also includes mild fuels as well as nuclear as well. So there is many different types of energy that we could invest in to make sure that these goals collide at least in the medium to long term. >> Is there a danger going forth that ESG, although a lot of institutions have made it pretty court of the mission right now that it gets pushed aside by the short term and is dumping follow-through on? >> It is interesting that you would say that because ESG investing seems to be at the forefront right now of political decision-makers. We have seen this sentiment in European Union for example, where in addition to investing in more fossil fuels, sources of energy for the short-term, they are also looking at policymaking for the medium to long term. And how they can invest more, allocate more, have more capital expenditure into sources of energy which are not as carbon intensive as fossil fuels. >> I feel like I am committing the deadly sin, even though I know full well at the program, we are talking about ESG investing, all I have asked you about is environmental. Environmental this and that. In ESG sounds… Is it environment and social governing they can work hand-in-hand? >> Sometimes they do and sometimes they don't. There can be some trade off. We as investors need to be very cognizant of that when we evaluate or do our due diligence in investment. To include in our portfolios. So, you know, in terms of ESG, obviously climate goals are very much aligned with social goals. At the end of the day, if the planet is out of its planetary boundaries, it's going to affect all of us. Communities, employees and stakeholders, everybody. So that is the aspart in the long term. But in the short and medium term, we need to focus on that just transition in the sense of transitioning some of the employees who have been traditionally employed in oil and gas sector to newer sectors or cleaner tech industries. So, I think these go hand-in-hand and there's always a question of governance. Right governance controls. Things like privacy and data security are top of mind for tech companies. There is a focus right now on healthcare. As you know with Roe V Wade being overturned in the states. So there is a ton of social issues and governance issues that we definitely need to pay attention to in addition to the E. >> Were going to get your to your questions with Priti Shokeen in just a moment. You can email us anytime at moneytalklive@td. com or fill out the your response box. Right now I want to get you updated. THE PRICE OF GOLD IS IN THE SPOTLIGHT TODAY. THAT AFTER THE G7 NATIONS ANNOUNCED A PLAN TO FORMALLY BAN NEW GOLD IMPORTS FROM RUSSIA. DATA FROM THE WORLD GOLD COUNCIL SHOWS RUSSIA IS THE WORLD'S SECOND-LARGEST GOLD PRODUCER – REPRESENTING ALMOST 10 PERCENT OF PRODUCTION IN 2020. IN A SEPARATE DEVELOPMENT, IT APPEARS RUSSIA HAS DEFAULTED ON ITS FOREIGN DEBT FOR THE FIRST TIME SINCE 1918. NUMEROUS REPORTS INDICATE SANCTIONS THAT PREVENT RUSSIA FROM TAKING PART IN INTERNATIONAL PAYMENT SYSTEMS CAUSED IT TO MISS A PAYMENT DEADLINE OVER THE WEEKEND. TORONTO-BASED "DYE AND DURHAM" IS REVISING ITS TAKEOVER OFFER FOR AUSTRALIA'S "LINK GROUP." ACCORDING TO A STATEMENT FROM LINK, THE BID HAS BEEN LOWERED TO $4-DOLLARS-AND-30 CENTS A SHARE AUSTRALIAN. THAT'S A REDUCTION OF MORE THAN A DOLLAR. AUSTRALIAN REGULATORS HAVE RAISED CONCERNS ABOUT THE DEAL, AND LINK'S SHARE PRICE HAS LOST SOME 16 PERCENT IN VALUE THIS MONTH. WHEN IT ANNOUNCED THE PROPOSED DEAL LAST DECEMBER, "DYE AND DURHAM" SAID THE TRANSACTION WOULD EXPAND ITS CUSTOMER BASE IN THE AUSTRALIAN AND U.K. MARKETS. DYE AND DURHAM IS A PROVIDER OF CLOUD-BASED LEGAL SOFTWARE. A U.S. COURT HAS PUT A TEMPORARY HOLD ON A REGULATOR'S BAN ON THE SALE OF JUUL'S E-CIGARETTES. THE COURT SAYS THE STAY IS NOT A RULING ON THE ISSUE AT HAND, BUT RATHER GRANTS TIME FOR THE COURT TO CONSIDER JUUL'S REQUEST FOR A REVIEW. JUUL IS PARTLY OWNED BY TOBACCO GIANT "ALTRIA GROUP." LAST WEEK, THE U.S. FOOD AND DRUG ADMINISTRATION PLACED A BAN ON JUUL'S VAPE PRODUCTS. THE F-D-A SAID IT WAS UNABLE TO ASSESS THE RISK OF JUUL'S PRODUCTS, POINTING TO CONFLICTING DATA FROM THE COMPANY'S STUDIES. JUUL SAYS IT DISAGREES WITH THE F-D-A'S FINDINGS. AND HERE'S HOW THE MAIN BENCHMARK INDEX IN CANADA IS TRADING… It's a bit of an indecisive start to the week on the back of energy and mining names in particular on Bay Street. The TSX composition index hundred and 64 points. A little shy of a full percent. South of the board of the S&P 500, a bit of a choppy or trade there. Right now basically just hanging and not even a full point to the upside. We call it flat for the most part in my b Lots of questions coming in. Let's get to them. This is an interesting work within the ESG framework nuclear. How should be viewed nuclear energy if we are talking about any issue frame? >> That's very topical because this has been an item of discussion within the ESG community and there is a growing acceptance of nuclear within the ESG community. Traditionally it was a no go for ESG funds as you know. But the fact of the matter is that nuclear is a proven technology that has proven to be low carbon intensive as it comes to its lifecycle immersions. Even compared to some of the renewable energy. If you compare, you know, the sourcing of materials or manufacturing materials, transportation and everything. IPCC report actually placed nuclear as the lowest… Per unit of energy. So there is definitely something to be said about nuclear going forward. You know, there's always going to be perception challenges with nuclear. The waste disposal question is always there as its construction cost. So that is three things that we will need to watch out for before nuclear becomes mainstream solution. Strategy transition. > When you talk with those perceptions, obviously we have big news thinking back to, 2012, I think. Fukushima was 2012. Obviously after that, you had emissions around the world saying "we are going to dial back." Germany being one example. Germany has we talked about at the top of the show, trying to figure out their own energy securities there. Will it take a while to get a mind shift back towards nuclear where some of these politicians want to be? >> It's always been a be a public reception issue for sure for politicians. I think we as investors try to find solutions to the energy transition challenge, we need to be focused on facts. The fact is that yes, Fukushima really was an inflection point for nuclear on the public perception side. At the same time, if you compare nuclear safety record to some of the other energy production sources and industries, it actually is better. In terms of fatalities and health and safety metrics. If you look at Fukushima itself, you know, there were not actually any fatalities resulting directly out of the accident. It was, I believe, there was only one fatality that was coded because of the accident itself which was called more like because of tsunami waves. … Relocation of people from that particular community. So there is a lot to unpack there for sure. We actually wrote a paper in case the audience is interested in going in detail of nuclear energy. >> My producer reminding me that 2011, of course, was Fukushima. I'm trying to think in terms of my own career. I was off by one. Is the technology itself changing? I think people have an idea that nuclear energy what it is based on past events. Perhaps older technology. Is there an evolution thereto and how we are producing this energy? >> Absolutely. Technology will always play a key role. There something called small modular nuclear reactors which have become quite a topic right now within the investment in the energy industry. Those are, you know, reactors that can easily be transported and placed in remote locations were other sources of energy are difficult to construct. There is a lot of development happening there if the audience is interested they should definitely look up small modular nuclear reactors. >> I can think in my lifetime, particularly at and I was younger in high school in the 80s and 90s when I was in university. Natural gas: at least from the advertisement we see on TV is seen as a cleaner source for our homes. How does natural gas in this environment fit into an ESG framework? >> It fits as a transition fuel. It's cleaner than coal and oil. At the same time, it does have emissions attached to it. So in the long run, we need to think about displacement of natural gas with more cleaner sources of fuel but the… Leading framework for environmentally friendly and economic activities, they have defined natural gas as a transition fuel in their framework. So I believe, the use of natural gas will definitely continue from that perspective and also just the reality that it is the most utilized fuel source for heating our homes and running some of the other industrial operations. >> Dissected natural gas is the end of the list? As we scream through companies we see they have divested in this in this… Comfortable for natural gas in several years or maybe even decades? >> There will be some hard to abate activities where natural gas and oil and gas will still play a role, Greg, over time. Even in 2050 we do anticipate some use of natural gas and oil and activities where you cannot replace them with anything else. But we are hoping is by that time, their use will be minimal. And only two activities were essential you can't abate that fuel source. That is our hope in the future and hopefully that's offset by carbon capture as it is with renewable energy. >> Is there a path forward for companies whose business is natural gas? Talking with companies and how they can get to a less carbon intensive place, ESG framework is there. Is there a long-term viability for natural gas companies are believed to be sunset companies? Is there other things we can do to fit into the ESG framework? >> Are framework focuses into capital expenditure. It's hard to see how companies see themselves in five, 10 years time. The companies themselves are transitioning off some of these activities. So we are hoping that over the time period, they would have enough capital expenditure to derive revenue from renewable sources and others that are sustainable business models. At the same time, we do believe that these natural gas and oil's and gas right now, they are going anywhere. They're still very much part of driving economic activity. So in the meantime, we are pretty bullish on the energy cavities. > Here's a question coming off the web broker platform. How do I actually know I am making a good ESG investment? Here's a phrase we've heard. Once people get excited about ESG, people say "is this company just greenwashing themselves to look like it's abiding?" >> To be honest it's not all about green tech. We need to go beyond the lofty statements as well on company websites. What we need to focus on as investors is metrics. Metrics are a great starting point to understand the trajectory of a company on any given issue. Metrics like carbon emissions, other greenhouse gas emissions. Health and safety metrics, water intensity of the company's operations… Employee engagement surveys and the response rates within that. So a lot of information is actually required by local jurisdictions to be reported by companies. It's not data that's unavailable. It is data that is available to us and if you track it over time, you can really figure out whether the company is improving the war actually is going down a negative trend. If it's going down a negative trend, context really matters. Is it going high on carbon emissions because they added an asset? Or is it because their operational efficiency has declined? Something like that. Very important to consider beyond what the company is actually saying. >> Given that the data is available, and that smart people like you and our audience are looking at the data, is there actually that much greenwashing going on? >> I think, the intentionality around ESG is actually true. Companies are not greenwashing by intention. You know? It's really about the marketing messages. So as long as it's not a marketing exercise and it's ringing true to their business, to their purpose, I do believe the companies are trying to do a good job. >> Will get back to your questions in just a moment's time. Adults always make sure you do your own research. Before making investment decisions. NOW LET'S GET TO TODAY'S EDUCATIONAL SEGMENT IF YOU'RE LOOKING TO FIND INFORMATION ON INVESTMENTS THAT FIT WITHIN THE ESG THEME WEBBROKER HAS TOOLS THAT CAN HELP YOU. JOINING US NOW IS CAITLIN CORMIER, CLIENT EDUCATION INSTRUCTOR AT TD DIRECT INVESTING. SO CAITLIN, HOW DOES IT WORK? >> We have the tools and it's very versatile and can really help us do some of the legwork when it comes to finding the CSG companies. What were gonna do is more than a hop right into web broker and were to go under our free search tab and over to tools. Were gonna go all the way down your door screen and it will bring up our landing page. So from there, where were gonna focuses on our themes. So we have a ton of different themes. I should say AB eight but we have a few different themes I should say. Themes on really hot topic type of areas. Again, ESG is one of them. So if we just kind of hover over this particular theme, we can see its constituents of the… Select ETF and the I shares at social index that's where these particular stocks are coming from the window to see these results. As we click on that, it's gonna give us a list of all those individual securities and it can actually rank the top 10 securities within that kind of list. Now, we may have 250 matches as being too made to go through. It is a lot. We can add different criteria to narrow down a little bit. So for example, I would choose the exchange. Admitted she was just Canadian exchange for today's purposes. Then maybe I also want to be a bit concerned about dividend. I would have a bit of yield so I can click dividend/yield and make sure that it's about zero. Essentially the company is paid a dividend. So as I scroll down here, once I put that in, I only have 40 matches. So much more reasonable to go through. Wanting again I can see the yield of the price-performance which is all a part of that ESG screen. The stock price and type of share. Again, if I click on the individual stock, I can actually get information if I'm not familiar with the company. I can see what type of company it is. What area of the marketed sin… So this one in particular is intelligent munication services. As I scroll down, it's gonna tell me why out of these 40 results. And also just if there's a particular area of the market that you want to shy away from, a particular type of company or industry that you didn't want to look, you can also go on the criteria and choose the industry and simply remove the sector that you don't want to be considering. So also keep that in mind. As we can see all the different sectors here. So if there's any particular one you don't want to consider you can just kind of on click it and any results within the criteria will not be there. >> That's very interesting. Clearly going thematically. We can get into a lot of different companies and screen and how we want to screen them. Once I'm there, I'm looking through all this, can I place a trade as easily as stocks ETF's? > Absolutely these results are to stocks to trade in the market. So these are individual companies that we are bringing up. It's a simple as just going to our list of matches. We can click over here on this little drop-down menu. We have buy, sell, overview, news charts and option available. We can always choose maybe a few different companies that are of interest to us. We can always build a watchlist with these companies may be just a panic keep an eye on them in the future and see if it's something that we may want to purchase rates absolutely we can definitely do that. That's all within web broker. > Very interesting stuff as always. Caitlin thanks for that. >> Thank you so much. >>-Cormier the client education instructor at td direct investing. >> Be sure to check of the learning centre for web broker for more educational videos, master classes and webinars. Before we get back your questions a reminder hiking in touch with us. Send us your questions. There are two ways you can get in touch with us. You can send us an email any time at moneytalklive@td.com or you can use the question box right below his screen here on web broker. Just writing your question and hit send. We'll see if one of our guests can get you the answer right here at MoneyTalk Live. Just a quick check in with the TSX competent index. Up hundred 44 points but three quarters of a percent. You have energy, materials and utilities. Showing the biggest gains percentagewise as far as sectors are concerned in Toronto. The bottom sector, is a bit of weight from technology and not so much. Song to call it flat. South of the border, for the S&P 500, we've been clawing our way into positive territory and then we give it up again. There you go. I wanted to check in. We are talking about the S&P 500 right now the broader view of the American market down five points. A little more of 1/10 of a percentage. South of the border we have energy and utilities to the upside but I'm seeing some weakness in the consumer stocks and technology names on Wall Street as well. OK WE'RE BACK WITH TD ASSET MANAGEMENT'S PRITI SHOKEEN DISCUSSING ESG INVESTING PRIVACY AND DATA SECURITY HAVE BEEN A BIG PROBLEM FOR BIG TECH. ARE COMPANIES DOING ENOUGH ON THIS FRONT? >> some are and some aren't. … Pretty much everyone a retail industry had to interact with clients or direct consumers over the Internet. So that exponentially increases risks to breaches, data breaches and, you know, protecting the information of their consumers. In a big way. So some companies have done really well in managing those risks. These data breaches do come with fines and the risk of losing customer loyalty. So these are materials, risks for these companies. We have seen some leaders on this issue. Facebook for example, now known as Meta has been fined almost $5 billion. That was the MDC in the US. We know alphabet is a little bit of a leader in this space. So is a new company called a neighbour which is come up with a philosophy of privacy by design which essentially means embedding privacy security into their entire business operations of the way they design their products. So it's a big issue for customers and it's something that we pay attention to to make sure that they are managing these risks well. >> Is there attention because knowing they had our data and when I think of the changes Apple bought into a further operating system than I have in Apple products. When it asked me "hey, can we track you across the Internet?" I said no. This comes at a cost for some companies. >> Absolutely and there's always been a be a balance between their growth ambitions and how they manage their clients information. I think the leading firms will recognize in the long term that they are more likely to retain customers if they respect their privacy and data security preferences. So to your point, when you choose those preferences, it really should be difficult enough. Actually it is required by law now that they have to abide by those preferences. So, I think the long term, companies will pay more attention to this issue and have customer first approach. This will come out to be a winning strategy. >> Another question coming in at the top of a show about Roe versus Wade. Obviously the shockwaves of centre American society. Companies interestingly responding pretty quickly. A very big corporation. Obviously this fits into the social framework of ESG. What was the your take on how some of these big names jumped into the discussion right away? > I think they are just sticking back to their philosophy of providing healthcare benefits that their employees need to be leading productive and healthy lifestyles. This is an extension of their already existing benefits but making sure that if any of their employees or partners need out-of-state travel provisions to get access to legal abortion, they are able to do so within the company's benefits. So I think some of the more progressive companies are taking much more active stance on this. >> Is this a different stance he would hear from corporate America Russian Mark maybe say 10, or 20 years ago? You say it falls within the realm of the health benefits that they are offering already their employees. But would we have seen this 10, 15 or 20 years ago from a big corporation? >> I would say probably not. But the fact of the matter is that employee engagement and employee morale are now closely tied to the purpose of their work and their corporations. So those voices are much more heard and now as opposed to perhaps, 10, 15 years back or may be that isn't the case. I don't want to speculate. But companies are much more responsive to their employees needs currently. Probably because of the pandemic as well because they want their employees to stay for longer and stay productive. >> Is an interesting question. It's nothing I thought about in the context of maybe the green push before the financial crisis. That when times are good, you want to pay a little bit more. Or you want to endure a little more pain to do the right thing. Economic hard times come. We think of the financial crisis, recession. Now that there are recession fears out there right now, can this dent be ESG movement in some way? Saying I'm fine to contribute to a better world where I can but things are tough and we have to put that on the side burner right now? >> ESG investing, as we see it, is really about managing nonfinancial risks and opportunities well. It still remains within the domain of the core business activity. I understand what you're saying, Greg, by pointing to the fact… >> It's only human nature right? The kind of circle in. >> I would characterize that is corporate philanthropy as opposed to actually ESG within the core business model. I think that's where the activity in focus is centred now. Asking how does a business service Society? And I think the conversation will stay there. > Does that mean there's a bigger risk on the other side? Because you know, the economy runs the cycles and there's always a recession. Is the risk is greater if we keep putting things to the side? Saying "wait till things are better… Because we know they're going to be tough times. > I agree on that one. What we may see happening is just like any other funds, we might see outflows. So that may be a consequence of our recession. But at the same time, I do believe that paying attention to those things now as you pointed out, will pay off in the longer term. >> Will get back to your questions in just a moment. Always make sure you do your own research before making any investment decisions. A reminder of course it get in touch with us at any time. you can send us an email anytime@moneytalklive.com or use the question box on the screen and web broker. Just write your question and hit send. We'll see if one of our guests can get you the answer right here at MoneyTalk Live. WITH RATES ON THE RISE TD SECURITIES HAS UPDATED ITS VIEW ON THE REAL ESTATE SECTOR. JOINING US NOW WITH MORE IS MONEY-TALK'S ANTHONY OKOLIE >> TD securities is updating their real estate income trust or sector to overweight from market weight. The real estate sector has been down about 20% since the mid-March peak. Now they are about 19% down to date. Recession fears… An increase in bond yields… Despite that, they believe that the fundamentals for the income sector is strong and remains strong. For the reasons that one, most sectors are fully recovered from the pandemic and secondly, there is a limit to supply a lot of these properties. And third, strong lease and demand. This assumes there is no economic recession. They expect, TD securities expects net operating income across the coverage universe of the region that they cover. In the reports now, they are also lowering the Target prices on all names in the coverage universe by between 3 to 15%. Now this is based on lower multiples as well as rising recession risk. But the Target total returns now averaged by 27% just across index names only. So for that reason, they justify the ratings of the majority of the coverage universe. Greg. >> This is interesting because we talk about rates, we know that there are issues of a lot of kind of real estate within it. There are malls, offices, warehouse is. >> They think they have the best operating fundamentals in any macroeconomic environment. I also mentioned that the topic prices are down quite a bit right now. So because of that, Karen evaluations, these sectors are pretty much relatively unattractive value. So they think it's a great time to buy. > Interesting stuff Anthony. Thank you. > My pleasure. >> Money talks Anthony Okolie. Let's check in on the market. … I'll call it 137 points on Bay Street. A little less than three quarters of a percent. It's the energy names in the mining names that are leaving the way higher holding us back from a better showing of the bigger tech names under pressure today. Let's take a look at Shopify. $472 and to share and change. Obviously since the highs of November, this is been quite a holdback for sharers of Shopify and people who hold those shares. Let's take a look at the American markets right now. The S&P 500 and see how it's faring. It's been a bit of an indecisive day on Wall Street to say the least to start the trading week. Right now you're down about 1/5 of a percentage. The S&P 500, that broader read of the market. The energy names are doing their part South of the border with some weakness in consumer names and technology names on Wall Street. Let's check in on the NASDAQ and see without putting their. In the tech space, a little more than 1/3 of a percent right now. We have some of those big tech heavyweights south of the border weighing on the trade. One name that caught my eye today in terms of not volume of shares but also the pullback for Carnival. They talked about their bookings improving. They don't think they're going to get back to pre-pandemic levels until sometime next year but it did put some money into the name. It seemed a bit of the giveback today for Carnival shares. 10 bucks and $0.48 a share right now. A little more than 3% of the downside. >> Were back now with Priti Shokeen from TD asset management. Let's talk a bit about about we have more questions. Is there an investment risk with carbon… >> I think it's going to be extremely critical to achieve the climate objectives that we have set out last year. It's just pure demand and supply. Higher carbon pricing is going to deter economic activity that is more carbon intensive. So from an economic standing point, we have 72 countries who are committed now to climate commitments. We have 5200 businesses across the globe that are aiming for net 0 x 20 50. It only goes on to show the scope of commitments on climate mitigation. I think climate pricing stands a really good chance of going and having a higher growth trajectory in the future. I wouldn't make any investment recommendations but definitely in our investment thesis it's going to play a critical role going forward. >> Obviously when you talk about the politics are in environmental movements, ESG investing, a lot of things can be contentious. The thing that always struck me with carbon pricing is that is it is a market-based sort of solution. In search of how are you going to tackle this problem? If you're talking about carbon pricing, you're talking about a market-based mechanism. >> Absolutely and the… Is a prime example of that. The fact of the matter is that if you are a business is that it's is very efficient in your carbon budget, you can actually sell off the credits that are given to you as a business and some other business who is polluting more than they are allocated. They can purchase those. So it's a really good way of putting cost on pollution. And I think it's going to be instrumental going forward. >> That's the carbon pricing part of the whole scenario. Over the next 10 years we have someone asking in terms of opportunities. If we have an ESG framework around our thesis, what should we be looking at assessing in the next decade? >> I think you know there is a lot depending on the geopolitical situation as well as, you know, public policy and regulations that come. But it seems like the commitments that have happened thus far and the level of support that global economic leaders are showing on climate change, the sectors that would do well his energy sector for sure. It's not only about fossil fuels. It's about many other different sources of energy. Many producers are now pivoting towards allocating more to renewables. So energy sectors are going to be certainly playing a key role in this and transportation is going to be another one. We hear a lot about TVs. The infrastructure surrounding EV's will need to be rounded up quite significantly going forward in the next decade or so. Similarly, we are hearing a lot about infrastructure. >> Electric car, people can plug it into their house. That's going to mean things the electrical grid. >> Yes. And sustainable, synthetics, fibers, plastic… Anything less polluting in nature, as a society we recognize that we want less of an environmental footprint and more sustainable lifestyles. So I do believe that, you know, companies in consumer goods for example who are paying more attention to plastics are using recycling and also sustainable materials as their raw material. They will be successful going forward. >> I think you raised a lot of excellent points during the show. This idea, and I often forget this, you say energy is a lot more than just about fossil fuels. We are sort of broadening our perspective as energy investors about what energy actually means. >> Absolutely. Energy is the fuel of the economic growth. Energy demands are set to increase. We've heard that from a lot of other commentators that, you know, we will need to have more energy for economic growth given the recessionary fares. It may turn out to be actually, perhaps not so negative things in terms of some of that global ESG objectives. But at the same time, perhaps turn out to be quite negative on the social aspect of employment. Income inequality and things like that. So I think energy will continue to play a very, very important role going forward. We just need to make sure that were not stigmatizing certain companies or certain types of energy consumptions as one worse than the others. Demand matters. Consumer preference matters in the choices we make make a lot of difference at the end of the day. >> Really appreciate you joining us there. Our thanks to Priti Shokeen from TD asset management. , HEAD OF ESG AND ENGAGMENT AT TD ASSET MANAGEMENT AND A REMINDER OF SOME OF THE GREAT GUESTS WE'VE GOT LINED UP.. ON TUESDAY, JUNE 28 HAF-IZ NOOR-DIN WILL BE ON THE PROGRAM TALKING FIXED INCOME ON WEDNESDAY, JUNE 29 BART MELEK WILL BE OUR GUEST TALKING COMMODITIES AND ON THRUSDAY, JUNE 30, FRANCIS FONG WILL BE ON THE SHOW DISCUSSING THE ECONOMY AND REAL ESTATE. And of course on Friday we will be off for Canada Day. That's all for our show today. Take care. (energizing music)