Navigating uncertainty
Spring has always meant renewal and a time of optimism. This year, many of you are likely dealing with feelings of uncertainty. This is understandable given current geopolitical concerns, the ongoing changes to the Canada-U.S. trade relationship, and volatility in financial markets.
In these moments, experienced, research-based advice matters more than ever. Manulife, with its extensive history spanning over 130 years, has consistently provided clients with expert guidance, helping them successfully navigate through periods of significant market turmoil. Our extensive experience and in-depth market insight enable us to support clients in achieving their financial goals and uncovering opportunity, even amid uncertainty.
Market turbulence and resilience
Despite the evolving trade picture and concerns about the growth and inflationary outlook, global financial markets were notably resilient during the first quarter. Canadian stocks rebounded from weakness in mid-March to finish the quarter up slightly, while European equities were sharply higher. U.S. stocks were the outlier, suffering their worst decline since 2022. Overall, market fundamentals continued to be strong, bolstered by robust corporate earnings and a resilient consumer sector.
The U.S. Federal Reserve remains patient in its approach to interest-rate cuts. With inflation continuing to moderate, we expect policymakers to proceed with a gradual easing cycle later this year. Global interest-rate cuts remain on track, and the Bank of Canada has now cut rates at seven consecutive meetings. As inflation cools and economic growth slows, a coordinated global easing cycle is expected to continue throughout 2025.
Canada's economy continues to navigate headwinds, with slowing consumer spending and a softer housing market reflecting the impact of prior rate hikes. However, the Bank of Canada’s March rate cut could offer some relief, helping to stabilize housing affordability and support economic activity as we move into the second half of 2025.
With the most recent tariff announcements, investors are now dealing with more significant financial market impacts as the increasingly aggressive U.S. trade policy heightens concerns over the global supply chain and economic growth outlook. While the resilience of the markets during the first quarter was a positive sign, it’s clear that trade-related risks will remain a key theme as the year progresses.
These risks, alongside the ongoing conflicts in Ukraine and the Middle East, reinforce the need for a diversified investment approach to both manage risk and capture opportunities. At Manulife Private Wealth, we have access to investments across not just geographies, but across public, private, and alternative investments. Please reach out to your investment counsellor to discuss how to best position your portfolio to ensure your peace of mind.
Important disclosures
The material contains information regarding the investment approach described herein and is not a complete description of the investment objectives, risks, policies, guidelines or portfolio management and research that supports this investment approach. This commentary in this report is provided for informational purposes only and is not an endorsement of any security or sector. The opinions expressed are those of Manulife Private Wealth as of the date of writing and are subject to change without notice. The information in this document including statements concerning financial market trends, are based on current market conditions, which will fluctuate and may be superseded by subsequent market events or for other reasons. This material does not constitute an offer or an invitation by or on behalf of Manulife Private Wealth to any person to buy or sell any security. Past performance is no indication of future results. The information and/or analysis contained in this material have been compiled or arrived at from sources believed to be reliable, but Manulife Investment Management does not make any representation as to their accuracy, correctness, usefulness or completeness and does not accept liability for any loss arising from the use hereof or the information and/or analysis contained herein. Neither Manulife Private Wealth or its affiliates, nor any of their directors, officers or employees shall assume any liability or responsibility for any direct or indirect loss or damage or any other consequence of any person acting or not acting in reliance on the information contained herein. Please note that this material must not be wholly or partially reproduced.
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