One Year Later
We hope that everyone is enjoying the spring weather and staying healthy as we enter this seemingly final push towards a return to more normal life.
Who would have thought that on March 23, 2020, just 12 days after the WHO declared the Coronavirus COVID-19 as a Global Pandemic, a new bull market would begin? Of course, it happened after the S&P 500 Index dropped over 35% in pretty much the fastest decent recorded in history (less than 5 weeks). As we passed the one-year anniversary of this bull market in late March 2021, the S&P 500 Index has now recovered from its dramatic decent and more than doubled its value (78%) according to our friends at AGF Investment Research. This is much better than the average one-year gain of 52% from the 20 bear markets since 1929, and ranks as the fourth best recovery on record.
S&P 500 Index (Feb 1, 2020 – April 1, 2021):
Global equities continued to gain in Q1, supported by rising participation in COVID-19 vaccination drives and expectations of a quicker and stronger economic recovery. In contrast, fixed income assets were challenged more as bond yields rose due to concerns of rising inflation. Bond yields, declined slightly over the last week of March after U.S. Federal Reserve Chair Jerome Powell brushed off concerns about inflation, which he expects will be “neither particularly large nor persistent”.
There are always several other developments worth considering which could have an impact on stock prices. The one with the highest likelihood of occurring, and possibly sooner rather than later, relates to President Biden’s election platform of raising taxes. The Infrastructure Plan as introduced recently by President Biden calls for the raising of the corporate tax rate from 21% to 28%. The timing of when this bill could actually become law is questionable especially in light of the opposition to it, not only from the Republican party but also from some Democrats.
The Canadian federal government will unveil its first budget in more than two years on April 19th. The budget is expected to provide a full accounting of all government spending through the pandemic, which has sent the deficit for the fiscal year to almost $400 billion. It is also expected to outline the Liberals’ plan to spend between $70 billion and $100 billion over the coming years on stimulus to help the economy recover. The government has said the spending plan will include measures to create a national child care system, improve skills training and build a greener economy.
Although the worst of the pandemic economically speaking seems to be behind us, we understand from our daily conversations with many of you the impact the pandemic has had personally, financially and/or medically. We remain committed to doing everything we can to help everyone cross the covid finish line and beyond.
Updates & Reminders
- Tax Season
Unlike last year, the CRA has kept the 2020 tax filing deadline the same as pre-pandemic years and is April 30, 2021. By now you should have received all applicable tax slips but please don’t hesitate to contact our office if you are in need of any tax related documents or information and we will be happy to provide duplicate copies.
- We Are Growing!
We continue to build out our team and are looking for an ambitious individual to join our client services team. This person will be an integral part of day-to-day operations and interacting with our clients so who better to go to than you to find the right candidate. Interested applicants can view the listing on our WEBSITE or submit a resume to WeAreGrowing@perfectiming.com.
- Continue to be OPEN for business
Nothing here has changed and we continue to remain open for business. If you’re like us, you’ve probably had interactions with some organizations this past year whose service levels have left much to be desired. We’re proud to say that we have members of our team in office daily in order to best serve the needs of our clients. We are following all government guidelines and our advisors and team are always available in whatever way you prefer.