February 2026 - Your Monthly Update

Hi,

 

Hope this note finds you and your family well as 2026 takes shape.

 

Your investment portfolio declined somewhat in January and is showing flat/neutral performance over the last twelve months.

 

On one hand, we remain in a short-term environment where stock price volatility in both directions is much higher than usual. There remains uncertainty and a lack of consensus around the near-term path for inflation and the economy. That said, the North American economy continues to show resilience which drives our constructive expectations for the future.

 

In 2026 and beyond, we expect leadership to return to businesses that make up the real economy as they begin to roll out the products, services and innovations that follow years of productive investments. This medium-term trend around productive investment by the private sector represents the foundation of future economic growth.

 

Here are a couple of data points that reflect our constructive view of the medium-term path ahead for the North American economy out of the United States (U.S.):

 

• Durable goods orders (excluding Transportation) climbed for a ninth straight month in December

 

• Nondefense capital goods shipments were also up +1.8% month over month. This is one of the components of the calculation for Gross Domestic Product (GDP) and provides a good read on business equipment spending. Throughout 2025, this datapoint grew by +7.1%, suggesting it was one of the biggest pillars of real GDP growth in 2025.

The private sector prefers steady prices. This makes projections more accurate and leads to greater confidence they will occur. Additional investment in productive assets follows. Regarding inflation and price stability, energy prices influence the price of everything throughout an economy.

 

Here are two of the more recent trends for energy prices in North America that would contribute to steady prices for the economy and continued investment by the private sector:

 

• The average price of gasoline in the U.S. is at a five year low

 

• The average price gasoline in Canada is over 15% lower than one year ago

 

Our long term strategy remains unchanged. Continue to focus on established, profitable, businesses central to the domestic North American economy. These areas remain fundamentally strong and stable as evidenced by their increasing dividends, record levels of cash on balance sheets and best in class leadership.

 

You and your investment portfolio are well positioned for the future.

 

The view from Brent Joyce, BMO Wealth’s Chief Investment Strategist:

"Theme from 2025 – the headlines are the headlines, but earnings are everything. Unless geopolitical developments threaten to dampen global growth or increase costs (inflation, oil prices, wages, taxes or borrowing costs), markets focus on earnings and rightly so. Venezuela and Greenland don’t move the needle on any of these fronts. Maybe Iran will for oil – we remain watchful, but since the world is awash in oil, the impact could be limited. Borrowing costs are reasonable, and both the Fed and Bank of Canada held rates steady… Even though the capital markets were somewhat agitated in January… it was also status quo: the factors most important to investors carried the day. Specifically, consumers kept their wallets open (despite being grumpy), businesses continued to invest in technology and beyond, inflation remained on a decent trajectory, and labour markets stayed stuck in a no hire, no fire, holding pattern appropriate to North America’s immigration backdrop. Markets love it that central banks can keep financial conditions loose, thanks to steady inflation (around 2.5%) and lacklustre labour markets. Add to this mix strong nominal economic growth – that’s real economic growth plus inflation – and signs of productivity gains. It all leads to expectations for robust earnings growth, which were validated by the latest round of reporting on company earnings. Canadian equity markets were set to dominate thanks to our market’s heavy exposure to precious metals mining, which drew global attention. Then, on January 30, the intraday price for gold fell more than 12%, marking its steepest decline since the early 1980s, and silver plunged a record 36% intraday. The S&P/TSX managed to hang on to a [neutral return] for January, but it was up… on the month before the final day of trading.”

 

• Stocks in your portfolio that made a new 52 week high this past month: Johnson & Johnson, Royal Bank*, S&P500, TD Bank*

• Stocks in your portfolio that made a new 52 week low this past month: Proctor & Gamble*, Thomson Reuters*

• The Loonie gained over half a cent versus the U.S. dollar to $0.735

 

Thank you,

Ian, Gab, Kaitlyn, Naina, and Meeral