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Portfolio Manager’s January Comment For Q4 2020 Results

By January 7, 2021 No Comments

Global equities ended the year on a strong finish. The S&P/TSX Composite Total Return Index increased by 9% in Q4 for a total annual return of 5.6%. During Q4, the S&P500 produced a 12.1% return for an annual total return of 18.4% while the MSCI ACWI ex US posted a 17.1% return leading to an annual return of 11.1%.

There was a number of drivers behind this strong finish. Firstly, most company’s results were inline or better than expected. Secondly, central banks have maintained a dovish tone. Finally, the arrival of highly potent anti-COVID vaccines.

In Canada, the best Q4 sectors were Health care up 29.9% and Consumer discretionary up 20.4%. The worst sectors were Consumer Staples down 6.0% and Materials down 4%.

For the year, Info-Tech and Utilities were the top performers up 80.3%% and 19.5% respectively while Energy and Health Care were the weakest down 30.8% and 23.6%

NQICA in Q4 returned 7.3% leading to an annual total return of 2% versus the S&P/TSX TR composite return of 9% in Q4 and 5.6% for the year.

The best performers in NQICA were First National up 8.9%, Equitable Group up 6.6% and Stella-Jones up 4.8% on the back of excellent Q3 results.
On the other hand, the worst performers in Q4 were Richelieu Hardware down 12.6% and Metro down 4.8% on profit taking.