David Driscoll

It's a relief rally, for sure. Especially in European and Asian markets, because they're the largest importers of oil. We're also seeing a surge in bond prices as well. If this truce goes through, then the bulls will be on target with better performance in the stock market. This on the expectation that interest rates may be on the way down in the US.

It's also why we saw the USA dollar fall today and gold go higher.

There's some hesitation going on among clear heads, given where markets are right now. But, really, we'll find out in May whether the Federal Reserve actively starts to cut interest rates.

Scott Bessent said recently that inflation is fairly muted, and that the Fed can continue to cut rates. If Mr. Warsh gets in as Fed chair, we'll see cuts in interest rates. When interest rates go down, stock prices always go up.

The only cautionary tales would be:  1) Oil prices aren't back to where they were at the beginning of the year, and 2) If the USD goes down, then you'll see the US start to import inflation. In those cases we'd see continued growth in the commodity sector, which could continue a bull market there.

Last year the US dollar was down 7%, and it started to fall again this year too.

It's very important in this kind of environment not to take anything for granted. Don't think that markets move up linearly. Always best to take some profits off the table, especially with high-flying, flavour-of-the-day stocks or those with high betas.

Examples include semiconductors, chip manufacturers, anything with extended valuations such as data centre involvement.

His firm goes by this rule:  Build a portfolio of 30 stocks, at 3% weighting each, and when a position gets to 6% they automatically pare back. For instance, last April/May they bought FIX for $300 or so. It's now up over $1600. Prudent thing to do is to rebalance the position back to neutral. This action prevents them from getting caught in a market selloff if we do get higher inflation.

Tailwinds for all Canadian banks last year -- net interest margins expanded, better wealth management performance due to stock market rising, M&A's starting to pick up again, higher trading volumes.

All are hitting new highs because not a lot has changed, other than mortgage volumes not being as strong because home prices continue to fall. Could be a red flag for 2026. It'll depend on interest rates and the economy.

He's noticed they've been buying back a lot of shares, and this helps the bottom line. As well, lots of ETFs out there have covered call strategies (they have to keep buying shares so they can write the call options). 

Unless we really get higher inflation and interest rates rising, he imagines banks in Canada will continue to grow, though not at the pace of last year. Expect a few hiccups along the way.

Compliance issues persist in US -- can't open new branches, can't make acquisitions until the Fed gives it the green light. Big runup due to banking sector tailwinds. Unless we really get higher inflation and interest rates rising, he imagines banks in Canada will continue to grow, though not at the pace of last year. 

Reset mode for last few years. You have to consider net interest margin, efficiency ratios, capital ratios, ROA, loan-to-deposit ratios. On those metrics, HSBC has been performing better than expected. Cleaned up balance sheet.

No reason to sell. If we return to better markets, should continue to grow. EMs have been doing a whole lot better, and that's its focus.

Instead, he owns SVNLY.

Nordic countries and England. Safer than, say, HSBC, as well as being more disciplined.

Probably won't know until 2027 what the outcome is for all these software firms. AI has created this "SaaS-pocalypse". They've all seen multiple contraction from ~40x PE down to 10-15x. 

Some are buying on the dip on the expectation that this is overblown. You have to decide for yourself whether things are OK now and the only place to go is up. If AI does have a lasting impact, this sector is not where you want to be.

He got rid of all of his software stocks last year.

Remember that hyperscalers are the ones that have the power right now. If quantum computing comes along, MSFT is already there. Building data centres, in the cloud. Hurt because of software concerns in general. Leveraging OpenAI.

Deemed fairly cheap relative to peers. Stock will probably move up. Very attractive level.

The benchmark you're looking for is the MSCI Emerging Banking Index (MXEF). You can look for ETFs that focus just on the banks.

As USD has fallen, EM currencies have gotten stronger. Last year the MXEF had the best return, up over 30%. You get both stock prices rising, as well as tailwinds relative to the CAD/US dollar.

For his firm, they own 3 banks. RY covers them in North America, SVNLY takes care of Continental Europe, and HDB (really cheap right now) on the thesis that India's population could make it the next superpower in the next 50 years.

For his firm, they own 3 banks. RY covers them in North America, SVNLY takes care of Continental Europe, and HDB (really cheap right now) on the thesis that India's population could make it the next superpower in the next 50 years.

US banks haven't been performing as well as Canadian banks right now. Headwinds from slowing economy among the middle-lower class. Fear of private debt, as a lot of the big banks offer that type of fund.

What matters is direction of interest rates (lower means more business plus lower mortgage payments) as well as drop in USD (attracts foreign investors). Wait-and-see come May, when new Federal Reserve chair takes the helm. If rates are cut, US banks should come back to life.

Still the best at what they do. A good anchor in a portfolio, as volatility is very low. Hasn't trimmed.

Nat gas prices have fallen, but you have to stay focused on what this company is all about. Utility with very little volatility attached to it.

AI can't touch its products. Good at acquiring mom-and-pop companies.