Monthly Performance Review

Transcription

1 Performance Review ScotiaMcLeod September 4, 2014 S&P/TSX Composite S&P500 September 4, 2014

2 TSX Performance Review August 2014 ScotiaMcLeod Portfolio Advisory Group TSX Performance Review August 2014 TSX Continues to Climb The S&P/TSX Composite index ed 1.9% in August on a price only basis. Of the 251 stocks in the index, 165 were higher,, 85 were lower, and 1 remained unchanged. The TSX 60 (large cap) underperformed the broader market in August, while the Completion (mid cap) and Small Cap indices outperformed, reversing July s trends. The S& &P/TSX underperformed the S& &P 500 in CAD terms in August, with the Canadian index up only 1.9% while the U.S. market climbed 3.5%. The Consumer Discretionary sector was the best performing sector in August, with a good earnings season and the big merger involving Tim Hortons Inc. (THI, +43.5% %). Industrials and Energy were the other sectorss to materially outperform the market. The weakest performances came from Healthcare, Financials, and Materials; however, all three delivered positive results Index Returns (pricee Only) S&P/TSX Composite S&P/TSX 60 (Large Cap) S&P/TSX Completion (Mid) +2.9% +15.0% S&P/TSX Small cap Biggest Point Contributors Tim Hortons Inc Canadian National Railway Co TransCanadaa Corp Brookfield Asset Management Inc Keyera Corp Pembina Pipeline Corp Canadian Pacific Railway Bank of Montreal Alimentationn Couche Tard Inc National Bank of Canada August YTD +1.9% +14.7% +1.6% +14.6% +2.3% +15.8% Biggest Point Detractors Valeant Pharmaceuticals International Inc Bank of Nova Scotia Suncor Energy Inc Canadian Natural Resources First Quantum Minerals Sun Life Financial Inc Potash Corp of Saskatchewan Inc Manulife Financial Corp Teck Resources Talisman Energy Inc

3 TSX Performance Review August 2014 Sector Financial 34.20% of S&P/TSX Composite Energy 26.47% of S&P/TSX Composite Materials 12.04% of S&P/TSX Composite Industrials 8.23% of S&P/TSX Composite Consumer Discretionary 5.56% of S&P/TSX Composite Telecommunications Services 4.42% of S&P/TSX Composite Healthcare 2.64% of S&P/TSX Composite Consumer Staples 2.80% of S&P/TSX Composite Utilities 1.87% of S&P/TSX Composite Information Technology 1.80% of S&P/TSX Composite price-only total Notable Movers 0.5% 0.7% Out of the 47 Financial sector constituents, 31 rose, 15 declined, 1 was flat. Significant bank earnings beats included Bank of Montreal (BMO, +2.9%), CIBC (CM, +2.7%), and National Bank (NA, +7.2%). The Bank of Nova Scotia (BNS, 2.7%) missed estimates, dealing the biggest blow to the index. Brookfield Asset Management (BAM.a, +6.8%), reported strong Q2 results and saw its three operating subs all move higher. Life Insurers such as Manulife Financial Corp (MFC, 1.5%) and Sun Life Financial (SLF, 2.7%) dragged the index down as bond yields retreated. 3.2% 3.5% 52 of the index s Energy constituents climbed this past month while 17 fell as stocks rebounded from July s weakness; pipeline and storage businesses surged. TransCanada Corp (TRP, +6.8%) was the biggest contributor in the sector, rising partly as consequence of the Kinder Morgan Inc (KMI) merger; Inter Pipeline (IPL, +7.4%) joined the rise. Talisman Energy Inc. (TLM, 4.2%) and Canadian Natural Resources (CNQ, 3.3%) pulled down the sector the most this month. 0.3% 0.4% Out of the 52 Materials index constituents, 27 rose, with Eldorado Gold Corp. (ELD, +11.1%) leading the charge after a good Q2 earnings report. First Quantum Minerals. (FM, 5.6%), after a star performance in July, had the biggest fall of the sector this past month. 4.1% 4.2% Canadian National Railway (CNR, +7.1%) and Canadian Pacific Railway. (CP, +5.1%) accounted for most of the lift in the subindex, partly due to lower oil prices, which reduced operating costs for the railways. 6.2% 6.5% Consumer Discretionary sector constituents mostly rose in July, led by Tim Hortons Inc. (THI, +43.5%), which had huge gains due to the merger with Burger King. Magna International Inc. (MG, +5.3%) also made a large impact on the sector s great performance this past month as it beat earnings. 1.5% 1.5% The Telecommunications Services sector declined during the first week of August but climbed back at a consistent pace for the rest of the month as bond yields dropped. Telus Corp (T, +4.2%) gained the most in the past month, with a Q2 EPS beat 0.6% 0.6% Catamaran Corp (CCT, +3.2%) and Extendicare Inc. (EXE, +14.9%) both rose over the past month, with CCT beating earnings expectations and being named as one of Fortune s fastest growing companies, and EXE being upgraded at CIBC. 2.1% 2.2% Out of the 10 Consumer Staples constituents, 6 rose in July, with Alimentation Couche Tard Inc. (ATD.B, +9.3%) having an impressively positive impact due to M&A activity within the sector. 1.9% 2.4% Out of the 12 Utilities constituents, 9 climbed while three declined modestly, displaying the broad impact of lower bond yields. 0.8% 1.0% The Information Technology sector constituents rose just above the unchanged mark, with 5 of the 8 increasing, as Blackberry (BB, +8.4%) attempts a comeback.

4 S&P 500 August 2014 ScotiaMcleod Mo onthly S&P 500 Performance Review August 2014 S&P500 Breaches 2000 The S& &P 500 Index ed 3.8% in August on a price only basis. Of the 502 stocks in the index, 445 were higher, 54 were lower, and 4 remained unchanged. The DOW Jones Industrial Average underperformed the broad market in August, while the NASDAQ and RUSSEL 2000 indices outperformed. The S&P500 outperformed the S&P/TSX Composite in USD terms in July, with the U.S. index up 3.8% and the Canadian index up 2.2%. The Healthcare sector performed the best, thoughh most sectors were relatively consistent with the eight best performers within a tight range. The weakest performances came from the Telecom and Energy sectors. Geopolitical tensions hit global equity markets early in the month, but markets staged a strong recovery after somewhat softer data allowed Janet Yellen to remain dovish Index Returns (price only) S&P 500 Index DOW Jones Industrials NASDAQ Comp. Index RUSSEL 2000 Index August YTD +3.8% +8.4% s +3.2% +3.2% x +4.8% +9.7% +4.9% +0.9% Biggest Point Contributors Biggest Point Detractors Apple Inc. Walgreen Co. Gilead Sciences Inc. Time Warner Inc. Berkshire Hathaway Inc. AT&TT Inc. The Home Depot Inc. Verizon Communications Microsoft Corp. Inc. The Procter & Gamble Co. Cognizant Technology Johnsonn & Johnson Solutions Corp. Merck & Co Inc. Pioneer Natural Resources Amazon.com Inc. Co. The Coca Cola Co. Wynn Resorts. ConocoPhillips Cisco Systems Inc. Halliburton Co.

5 S&P 500 August 2014 Sector Information Technology 19.36% of S&P 500 Index Financial 16.13% of S&P 500 Index Healthcare 13.66% of S&P 500 Index Consumer Discretionary 11.91% of S&P 500 Index Energy 10.41% of S&P 500 Index Industrials 10.24% of S&P 500 Index Consumer Staples 9.40% of S&P 500 Index Materials 3.50% of S&P 500 Index Utilities 3.00% of S&P 500 Index Telecommunications Services 2.39% of S&P 500 Index priceonly total Notable Movers 3.7% 4.0% Nearly all constituents in the sector rose, as 57 of 64 climbed, with Apple Inc. (AAPL, +8.1%) contributing the most as the tech giant excited the market with news that it will be releasing a new, larger iphone as well as an iwatch later in the year. A strong upward move from Microsoft Corp. (MSFT, +5.3%) also contributed to the sector s lift. 4.0% 4.2% All but 4 of the 84 Financial sector constituents were up in August as banks had a strong earnings season, namely with Bank of America Corp. (BAC, +5.5%), Citigroup Inc. (C, +5.6%), and JP Morgan Chase & Co. (JPM, +3.1%) leading the pack. Berkshire Hathaway Inc. (BRK/B, +9.4%) contributed the greatest positive impact to the sector s performance. 4.7% 4.9% Gilead Sciences Inc. (GILD, %) stood out as the biggest contributor to the Healthcare sector s rise in August as its leading drug received further acceptance. 4.3% 4.5% Big retail names in the sector had strong gains this past month, with Home Depot Inc. (HD, +15.7%), Lowe s Cos Inc. (LOW, +9.7%), and The TJX Cos Inc. (TJX, +11.9%) all beating earnings expectations early in the month. Entertainment companies Twenty First Century Fox (FOXA, +11.8%), The Walt Disney Co. (DIS, +4.7%), and Netflix Inc. (NFLX, +13%) also supported the sector s success this month. 1.8% 2.2% Out of the Energy sector s 45 constituents, 35 rose while the other 10 declined. In regards to impact on the sector s performance, the only outlier was Occidental Petroleum (OXY, +6.2%). The mega merger of the Kinder Morgan companies resulted in big gains for Kinder Morgan Inc. (KMI, +11.9%), and had spillover effects into other mid and downstream oil companies. 3.9% 4.2% Industrials exhibited an excellent month in terms of growth, with all but 4 of its 64 constituents pushing higher, while 2 of those 4 were also left unchanged. General Electric Co. (GE, +3.3%), Union Pacific Corp. (UNP, +7%), Caterpillar Inc. (CAT, +8.3%), and The Boeing Co. (BA, +5.3%) were the sectors biggest influences. 4.6% 4.7% Soft drink and tobacco companies pushed the sub index higher, with The Coca Cola Co. (KO, +6.2%), PepsiCo Inc. (PEP, +5%), and Philip Morris International Inc. (PM, +3.6%) all up strongly. 3.5% 3.8% The Materials sector s constituents displayed a fruitful month of gains, with 28 of the 30 stocks moving higher. LyondellBasell Industries NV (LYB, +7.6%) brought the index up the most. 4.5% 5.0% 29 out of 30 of the sector s constituents went up in August, with its biggest winners being Exelon Corp. (EXC, +7.5%), and NextEra Energy Inc. (NEE, +4.9%) as bond yields moved lower. 1.1% 1.0% The sector lacked strength, as a jump in AT&T Inc. (T, 1.8%) and Verizon Communications Inc. (VZ, 1.2%) in late July on news of a potential REIT spinoff did not materialize and the market became increasingly worried about wireless competition.