Monthly Message

The Wutherich & Co. Composite was flat at 0.0% in February. This compares with the S&P/TSX up 0.2%, the BMO Small Cap Index up 0.1%, S&P 500 (US$) up 4.0%, the DJIA (US$) up 5.2%, while the NASDAQ (US$) was up 3.8%.

The Trump Bump continues, at least in the US. While it is entertaining to watch big market moves, we think investors should temper their enthusiasm for Trump’s economic pronouncements. Some of them may confer significant benefits over time but their short-term effects are probably limited. In our portfolio, Stantec has moved from $29 to $36 after Trump’s election. The company is one of North America’s largest providers of engineering consulting services. Much of the work that they do is related to infrastructure. As such, they would be “yuge” beneficiaries of Trump’s intention to vastly increase spending on infrastructure projects. There is no question that the country needs the work done, but it will likely take much longer for the money to flow than investors may be anticipating. The company itself doesn’t see much increase in spending for 2 or 3 years. The Bump may dissipate as investors lose patience in waiting for concrete results to show up in companies’ financials.

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