“The stock market represents three types of businesses: shrinking, stable, and growing intrinsic value. Prefer buying growing businesses at a discount.” – Michael Burry
Last Week’s Overview
| Index |
Performance |
| TSX Composite |
-0.710%
|
| Dow Jones |
-0.571%
|
| S&P 500 |
-0.523% |
| NASDAQ |
-0.968% |
Source: Bloomberg (Aug 20, 2026)
Weekly Insights
Each week, we break down the key events and market movements shaping the investing landscape. From economic data to investor sentiment and global headlines, this section captures what mattered most, and how it impacted markets.
Consumers Keep Spending When the Price Is Right
The latest round of retail earnings showed that households are still opening their wallets, with major national retailers reporting sales gains and back-to-school spending running nearly 20% higher than a year ago. However, consumers are being more thoughtful about where the money goes.
Retailers responded to that price sensitivity directly; one large chain lowered prices on more than 11,000 items during the quarter, and home improvement spending held up on smaller projects and purchases that do not require financing. Consumer spending accounts for close to 70% of U.S. economic output, and economists surveyed by Bloomberg expect it to grow at a 2.1% annualized pace in the third quarter, suggesting the engine of the economy is still running.
Source: Bloomberg (August 20, 2026)
Bond Yields Remain Attractive as Treasury Steps Up Buying
The U.S. Treasury announced plans to at least double the size of its buyback operations for government bonds maturing in 10 to 30 years, a technical change that adds a new source of demand at the long end of the market. Long-term yields dipped on the news before settling higher, with the 30-year finishing the week around 5.26% and the 10-year touching 4.71%, levels that remain historically generous compared to most of the past decade.
For our clients, that combination matters: today's starting yields provide a meaningful income cushion, and if yields eventually moderate, longer-dated bonds may also have room to appreciate.
Source: Bloomberg (August 20, 2026)
Shifting Bond Dynamics Open Doors Across Asset Classes
What happens in the Treasury market rarely stays there, and the buyback announcement rippled quickly into currencies, with the Bloomberg Dollar Spot Index falling to its weakest level since mid-May.
Research teams at one major global bank responded by removing their cautious stance on longer-dated bonds, noting that the long end of the yield curve now looks better anchored, while also pointing to potential opportunity in gold and higher-yielding currencies. This is a useful reminder of why we build portfolios that hold high-quality bonds, equities, and diversifying assets together rather than betting everything on one economic outcome.
Source: Bloomberg (August 20, 2026)
Key Drivers of Our Outperformance
We believe in transparency when it comes to where our outperformance is coming from. This section spotlights a top-performing company we hold, a sector where we've taken a winning position, and a strategy that has driven recent success across our portfolios.
- Company Highlight: Merck & Co. Inc. (MRK)
- Merck was our standout holding last week with a 14.50% gain (including a 12.6% jump in a single session) after a late-stage clinical trial delivered strong results for a personalized cancer treatment used alongside the company's flagship cancer drug, Keytruda.
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- The study met its main goal by showing a meaningful improvement in keeping high-risk melanoma patients cancer-free, which strengthens the commercial outlook for the combination and deepens Merck's pipeline of future oncology products. That matters to us because it helps address the single biggest question investors have had about Merck, namely what replaces Keytruda revenue when its patents expire, and it arrives alongside an improved 2026 sales outlook.
- Source: Optimize Asset Management (Aug 20, 2026)
- Sector Highlight: Health Care
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- Health Care is our sector highlight, with gains that reached well beyond a single name: Eli Lilly rose 4.92%, Johnson & Johnson added 4.81%, and Pfizer advanced 7.34%. The broader market moved with us, as the S&P 500 Health Care sector posted a 3.2% one-day advance on August 19 (its best single day since April 2025) on renewed enthusiasm for pharmaceutical and biotechnology innovation.
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- We like Health Care for exactly this reason: it pairs the steady, defensive earnings of businesses people rely on regardless of the economy with genuine growth potential from new drug launches and pipeline breakthroughs.
- Source: Optimize Asset Management (Aug 20, 2026)
- Style Highlight: Value
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Our Value strategy was the week's strongest quantitative style, drawing its strength from two very different places: pharmaceutical companies riding a wave of innovation enthusiasm, and energy producers supported by firm crude oil prices that rose for a fourth consecutive session. Exxon Mobil, Chevron and ConocoPhillips rose, indicating a spread of businesses that share little except attractive valuations relative to what they earn. This is the diversification benefit we look for from Value; when higher long-term bond yields put pressure on expensive growth stocks earlier in the week, our Value holdings picked up the leadership baton.
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Source: Optimize Asset Management (Aug 20, 2026)
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What To Look For Next Week
We also look ahead to the economic reports, events, and earnings that may influence the week ahead. From inflation and jobs data to corporate updates from key market players, this section keeps you informed on what's coming, and why it matters.
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- U.S. Core PCE Price Index (Wednesday, August 26): Wednesday brings the core PCE price index, the inflation measure the Federal Reserve watches most closely when deciding where to set interest rates. The latest reading showed prices rising just 0.1% from the prior month, coming in below the 0.2% increase economists expected, while the annual pace held at 3.3%, still above the Fed's 2% target. A continued cooling in the monthly numbers would strengthen the case for rate relief, which historically supports both bond prices and the valuations of growth-oriented companies we hold.
Source: U.S. Bureau of Economic Analysis (August 21, 2026)-
- U.S. Gross Domestic Product (Wednesday, August 26): Also on Wednesday, we get an updated look at how quickly the U.S. economy is growing. The most recent estimate showed the economy expanding at a 1.5% annualized pace, a step down from 2.1% in the prior quarter, though the composition was encouraging. Consumer spending accelerated sharply to 3.2%, equipment investment stayed robust at 15.2%, and residential investment rose 1.5% for its first increase in six quarters. We read this as an economy that is moderating rather than stalling, which is often the most constructive backdrop for a balanced portfolio.
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Source: U.S. Bureau of Economic Analysis (August 21, 2026)
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- Canadian Gross Domestic Product ( Friday, August 28): Friday closes the week with Canada's growth figures, an important gauge for the domestic holdings in our portfolios. The most recent quarter was flat, matching the prior period's 0.2% contraction, with household consumption up 0.4% and a 2.9% rise in imports weighing on the headline number. Much of that import activity, largely gold and manufactured goods, went into business inventories rather than being consumed, and that inventory build was enough to keep the economy from posting a second straight decline.
Source: Statistics Canada (August 21, 2026)
Source of All Economic Data: Bloomberg
Disclaimer: This report is for informational purposes only and does not constitute investment advice. Please consult with your financial advisor before making any investment decisions.