“You only have to do a very few things right in your life so long as you don't do too many things wrong.”
- Warren Buffet
The past week offered a clearer picture of where markets are placing their confidence: artificial intelligence leadership, resilient industrial demand, and companies with the pricing power to navigate persistent cost pressures.
While major U.S. indices pulled back modestly, underlying themes continue to reinforce our long-term positioning.
Weekly Index Performance (as of February 19, 2026)
TSX Composite: +0.61%
Dow Jones: -0.54%
S&P 500: -0.28%
NASDAQ: -0.31%
Source: Bloomberg
Below, we break down what mattered most — and what it means for portfolios.
A Powerful Vote of Confidence in AI Leadership
One of the world’s largest technology companies made a decisive move this week: Meta committed billions of dollars to Nvidia’s artificial intelligence chips.
That decision sent a clear message.
Nvidia remains the foundational platform for building AI at scale.
In recent months, Nvidia’s stock had lagged as investors rotated toward memory chipmakers and questioned whether competitors like Google might challenge its dominance. Meta’s commitment shifts that narrative. By selecting Nvidia’s full product ecosystem — processors, networking equipment, and related technologies — Meta reaffirmed Nvidia’s position at the center of the AI buildout.
For investors, this matters.
It reinforces a key principle behind our strategy: own the leading platforms driving structural growth, rather than chasing smaller, more speculative players attempting to compete at the margins.
When industry leaders place multi-billion-dollar bets, we pay attention.
The Trade Deficit Tells a Different Story
The United States closed 2025 with one of its largest trade deficits on record — $901.5 billion. In December alone, the deficit widened to $70.3 billion, as imports rose and exports declined.
At first glance, that sounds concerning.
But context matters.
A meaningful portion of the increase reflects imports of advanced computers and technology equipment — the very hardware powering AI initiatives across corporate America.
In other words, businesses are investing aggressively in the future.
While the trade gap with China narrowed, supply chains continue to shift toward countries like Mexico and Vietnam. Trade flows are evolving, not disappearing.
For investors, the key takeaway is this: capital spending on technology infrastructure remains strong, directly benefiting companies positioned at the center of AI, data centers, and digital transformation.
Inflation Eases — But Not Everywhere
January brought welcome relief on headline inflation.
Consumer prices rose 2.4% year-over-year, down from 2.7% in December — better than expected.
However, the details tell a more nuanced story:
- Gasoline prices fell significantly.
- Food, electricity, natural gas, and insurance costs remain elevated.
- Some pressures reflect tariffs working through the system.
- Others stem from higher energy demand driven by AI data centers.
This mixed picture is unlikely to push the Federal Reserve toward rapid policy changes.
For portfolios, the implication is clear: pricing power remains essential.
Companies that can absorb or pass along higher costs without sacrificing profitability are best positioned when everyday necessities remain expensive.
Key Drivers of Our Outperformance
Transparency matters. Here’s what drove performance across our portfolios last week.
Top Company: Deere & Co. (DE)
Weekly Gain: +11.0%
Deere was our standout performer.
Growing confidence in global economic stabilization and infrastructure investment created a favourable backdrop for high-quality industrial leaders. But Deere’s story goes deeper than traditional equipment.
The company has evolved into a precision agriculture technology leader — integrating:
- GPS-guided systems
- Advanced sensors
- Data analytics
- Automation tools
These innovations help farmers produce more with fewer inputs — a powerful value proposition in today’s cost-sensitive environment.
Despite variability in quarterly earnings, revenue growth remains solid, supported by disciplined cost and inventory management.
This is precisely what we seek:
- Market leadership
- Technological innovation
- Pricing power
- Financial strength
Top Sector: Industrials
Average Gain Across Holdings: +2.3%
Industrials led performance, and importantly, gains were broad-based:
- Lockheed Martin: +4.6% (defence spending strength)
- ADP: +3.0% (steady workforce management demand)
- Vertiv: +2.8% (AI-driven data center buildout)
- Canadian Pacific Kansas City: +1.9% (trade volume growth)
The diversity is compelling.
Defence, data infrastructure, transportation, and equipment all moved higher together — signaling multiple durable demand drivers rather than reliance on a single theme.
Our industrial holdings share strong balance sheets, durable revenue streams, and exposure to infrastructure and defence spending trends that extend beyond short-term cycles.
Top Quant Strategy: Momentum
Average Weekly Gain: +2.7%
Momentum led our quantitative strategies, reflecting improving market stability and confidence.
Top contributors included:
- Applied Materials: +12% (semiconductor equipment demand)
- Deere: +11%
- Palantir: +4.5% (AI analytics contract wins)
- Arm Holdings: +3.9% (central role in chip design)
- Morgan Stanley: +3.8% (capital markets strength)
What stands out is the breadth.
From chip equipment to agriculture, AI software to financial services, the market rewarded strong execution across industries.
Momentum tends to perform well when leadership broadens and confidence improves — conditions that appear to be taking shape.
What to Watch This Week
Three key economic releases could shape near-term market sentiment.
Consumer Confidence — Tuesday, February 24
January’s Consumer Confidence Index plunged nearly 10 points to 84.5, the lowest level since 2014.
The Expectations Index fell to 65.1, well below the 80 threshold that historically signals recession risk.
High prices, tariff concerns, and job security uncertainty weighed heavily on sentiment.
With consumer spending representing roughly 70% of the U.S. economy, Tuesday’s reading will be critical in determining whether pessimism is deepening or stabilizing.
Our focus remains on companies with strong brands and resilient demand — businesses that perform even when consumers grow more selective.
Weekly Jobless Claims — Thursday, February 26
Last week’s report surprised positively:
- New claims fell to 206,000, well below expectations.
- Continuing claims edged up to 1.87 million.
The broader labour market remains stable — low layoffs offsetting softer hiring.
A steady labour backdrop supports consumer spending and corporate earnings, without creating overheating concerns for policymakers.
Producer Price Index — Friday, February 27
December’s wholesale inflation data showed:
- Headline PPI: +0.5% (above expectations)
- Core PPI: +0.7% (largest gain since July)
- Year-over-year headline: 3.0%
- Core: 3.3%
Rising business input costs can eventually flow through to consumers.
Again, this reinforces the importance of owning companies with pricing power and operational flexibility.
Final Thoughts
Markets continue to rotate and recalibrate, but the underlying themes remain consistent:
- AI infrastructure investment is accelerating.
- Industrial demand is broadening.
- Inflation is moderating — but not disappearing.
- Labour markets remain stable.
Our approach remains disciplined and long-term.
We focus on owning exceptional businesses with structural growth drivers, pricing power, and financial resilience — the types of companies that can compound value across cycles.
As always, our priority is helping you achieve your long-term financial goals through thoughtful portfolio construction and consistent execution.
Thank you for your continued trust.