Market week: Stock uptrend continues

Market week: Stock uptrend continues

Consumer spending leads recovery


North American stock markets edged higher on the week, as some of the big indexes again reached record highs. Investor sentiment was buoyed in the U.S. by a 9.8% gain in total monthly retail sales for March, as the broad Covid-19 vaccine rollout continues. With growing job creation as economic growth surges, consumer spending is likely to grow even more, spurred on by high consumer confidence, pent-up demand, and a savings bubble created by pandemic lockdowns. In addition massive fiscal stimulus in both Canada and the U.S. will provide even more of a boost for recovery.

The broad North American recovery was also reflected in growing job gains in Canada, as the labour market added 303,000 jobs in March, following a gain of 260,000 in February. The quickly spreading Covid variants in Ontario, Canada’s largest province, has led to an extension of a province-wide lockdown and wider restrictions on mobility, as a shortage of vaccines from the federal government continues to delay wider vaccine administration. This is likely to dampen economic growth somewhat in the second quarter.

Toronto’s S&P/TSX Composite Index edged up a marginal 0.6% on the week, while the S&P 500 Composite gained 1.4% and the Nasdaq Composite advanced 1.1%. Crude oil posted a 6.3% weekly gain, while gold rose 1.9%.

Monitor the main stock and commodity indexes daily with the Fund Library’s interactive Markets Page.

Fund news

* iA Clarington merges 20 funds, terminates two. iA Clarington Investments Inc. on April 12 announced that it is merging 20 of its actively managed mutual funds and all-in-one portfolio solutions effective Aug. 27. Information on the fund mergers can be found on the Clarington website. The company also announced that it is terminating two funds effective July 16, IA Clarington Emerging Markets Bond Fund and IA Clarington International Equity Fund.

* Evolve goes into the Ether. Evolve Funds Group announced on April 16 the debut of its Ether ETF (TSX: ETHR), which is expected to begin trading on April 20 on the TSX, subject to TSX approval. ETHR is designed to provide investors with direct exposure to Ether, currently the world's second-largest cryptocurrency by market capitalization.

“We are very excited to have launched one of the world’s first bitcoin ETFs and now plan to launch the world’s first Ether ETF,” says Raj Lala, President and CEO at Evolve.

ETHR will invest directly in Ether, the cryptocurrency used to pay for transaction fees and computational services on the Ethereum network, the most actively used blockchain. The fund provides investors with exposure to the daily price movements of the U.S. dollar price of Ether  and will not seek exposure through derivatives or futures contracts. The fund intends to invest in Ether on a passive basis, and the ETF’s holdings will not be actively managed and will not be hedged or repositioned to attempt to take defensive positions if the price of Ether declines or is expected to decline.

Gemini Trust Company, will act as the sub-custodian of ETHR’s holdings of Ether. The ETF will directly own Ether on the Ethereum blockchain, held in Gemini’s cold storage system and protected in accordance with industry-leading protocols.

* Horizons launches Bitcoin ETFs. Horizons ETFs Management debuted its BetaPro Bitcoin ETF (TSX: HBIT) and BetaPro Inverse Bitcoin ETF (TSX: BITI) which began trading on April 15. The funds are available in both Canadian dollar and U.S. dollar units. HBIT and BITI provide long and inverse exposure, respectively, to the Horizons Bitcoin Front Month Rolling Futures Index (Excess Return). The index is a proprietary index provided by Horizons ETFs and is designed to reflect the returns generated over time through exposure to long notional investments in bitcoin futures that are based on the CME CF Bitcoin Reference Rate (BRR), which aggregates bitcoin trading activity across major bitcoin spot trading venues between 3:00 p.m. and 4:00 p.m. (GMT). The Index is calculated by Solactive AG.

* TD debuts healthcare ETF. TD Asset Management on April 14 launched TD Global Healthcare Leaders Index ETF (TSX: TDOC) with global exposure to the growing healthcare industry. The ETF tracks the Solactive Global Healthcare Leaders Index of global large- and mid-capitalization companies related to healthcare.

* Horizons launches BBIG technology ETF. Horizons ETFs on April 12 debuted its Horizons Global BBIG Technology ETF (TSX: BBIG), which tracks the Solactive Global BBIG Index. The fund is designed to provide exposure to publicly listed large-cap and mid-cap global equities in the secondary battery, biotechnology, Internet, and gaming (BBIG) industries. BBIG's Index utilizes a proprietary natural language processing algorithm developed by Solactive called ARTIS. The algorithm identifies companies with significant exposure to the provision of products and/or services in the Index’s relevant industry categories. Each of the four industry categories are limited to 10 constituent holdings and are equally weighted at 2.5% at each selection and review day.

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