MicroStockHub
By Ryan Crowther, CFA & Les E. Stelmach, CFA
Cost of Capital Critical for Stocks in New Regime
Market Overview
The Canadian equity market kicked off 2024 with a robust 6.6% first-quarter advance, building on the solid 11.8% return registered in 2023. In fact, equity market returns accelerated throughout the quarter with strength in March helping propel the S&P/TSX Composite TRI to new all-time highs. That said, gains in Canadian equities continue to pale in comparison to the ongoing boom in U.S. equities, with the S&P 500 (SP500, SPX) TRI returning 13.3% (in Canadian dollars) in the first quarter on top of 23.3% in 2023 — a large portion of these gains derived from mega cap information technology (‘IT’) and related names.
Benchmark 10-year interest rates in Canada and the U.S. ended the first quarter higher at 3.47% and 4.21%, respectively. Although below their 4.24% and 4.99% respective October 2023 peaks,…
