Market breadth continues to expand as credit spreads remain tight and volatility stays contained, creating a constructive backdrop for a potential year-end chase. Leadership is concentrated in financials, industrials, energy, and materials, while consumer sectors and REITs lag, reinforcing the importance of targeted positioning and disciplined selling.
Key Points:
Breadth & backdrop
- Market breadth is expanding, credit spreads sit near multi-decade lows, and volatility is mid-range (not at lows) per VIX—a constructive setup as under-invested participants may chase into year-end.
Leadership & portfolio posture
- Financials are steady (XLF), industrials—especially aerospace/defense—continue to firm; materials are ~15% (significant overweight). Adds include Finning, Kraken Robotics, and Major Drilling. Gold miners are outperforming gold; flows show investors fading GDX, raising squeeze risk.
Energy tilt up
- Energy weight increased from ~7.8% to ~11–12% firm-wide; Canadian energy (XCG) is turning up on relative strength with leadership from names like Imperial and Tamarack.
Tech (targeted, not broad)
- Large-cap tech remains resilient; semis caught a strong bid (Lam Research up ~40% over ~3 weeks). Communications trimmed (exited Meta, Netflix) while Take-Two, Google, and Sea Limited continue to perform.
Clear laggards
- Consumer staples and consumer discretionary are weak (homebuilders failed to sustain a rally). REITs remain under pressure as higher financing costs bite; U.S. pipelines are tough even as Enbridge holds up in Canada.
Global & EM momentum (plus caution on privates)
- International/EM leadership continues (Japan +23% since highs; EM six-month momentum strong). The global portfolio is differentiated—heavy Asia (~60%) and LatAm (~20%)—and has outpaced the equally weighted S&P and the FTSE All-World ex-US ETF since inception. Staying cautious on private-market asset managers given liquidity/valuation risks.