Global markets delivered mixed results in June as investors weighed slowing economic momentum, evolving trade policy, and ongoing geopolitical uncertainty. While some regional markets proved resilient, global equities broadly declined in U.S. dollar terms, with weakness across developed and emerging markets partially offset for Canadian investors by currency movements. The Bank of Canada held its policy rate steady during the month, while markets continued to weigh the impact of higher energy prices, tariffs and supply-chain disruptions against resilient corporate earnings and longer-term growth expectations.
Equity markets were positive overall, with Canadian equities producing a modest gain while U.S. and international equities benefited from stronger foreign currency returns. The S&P/TSX Composite returned 0.5%, while the S&P 500 returned 2.0% and Russell 2000 returned 6.8% in Canadian dollar terms. International equities also advanced, with the MSCI EAFE returning 3.1% and emerging markets returning 1.4%.
Fixed income markets were positive during the month. The FTSE Canada Universe Bond Index returned 0.5%, while the Bloomberg Global Aggregate Bond Index returned 2.3% in Canadian dollar terms. While inflation and interest rate uncertainty remain important risks, monthly returns were supported by bond income and a favourable currency impact for global bond.
From a currency perspective, the U.S. dollar appreciated approximately 3.0% against the Canadian dollar during the month. This provided a meaningful tailwind to unhedged U.S. dollar exposures for Canadian investors and helped offset weaker underlying U.S. dollar returns in some global markets.
Against this backdrop, the Balanced Fund returned 1.8% for the month. The Equity Fund returned 1.6%, while the Bond Fund returned 1.0%. The Money Market Fund returned 0.2%.
Disclaimer
The information contained in this market summary is provided for general informational purposes only and is intended to help CSS Pension Plan members understand recent market conditions and the performance of CSS funds. It does not constitute investment advice, and should not be relied upon as the basis for any investment decision.
As a defined contribution plan member, the value of your account and the appropriateness of any particular investment option will depend on your individual financial situation, retirement goals, time horizon, and risk tolerance. Past fund performance is not indicative of future results.
Nothing in this summary should be construed as a recommendation to buy, sell, or hold any investment, or to change your current contribution or investment directions.
If you have questions about your personal account or would like to discuss your individual circumstances, we encourage you to contact a CSS Retirement and Pension Advisor. Our advisors are available to provide guidance tailored to your specific situation.