Canada has been the best-performing stock market in the world this year, defying the knock-on effects of Brexit carnage to give investors double-digit returns.
The MSCI Canada index has risen 15.5 per cent year to date in US dollar terms compared to just 1.6 per cent from the MSCI All Countries World index.
Many global stock markets have suffered fall-out from the UK’s decision to leave the EU, with the MSCI United Kingdom index having made a loss of 3 per cent year to date, MSCI France at -3.3 and MSCI Germany the world’s worst performing, at -7 per cent.
Canada’s stock markets are dominated by commodity-dependent companies including energy and materials, alongside financials.
Just a year ago analysts believed Toronto’s TSX market was beginning a lost decade as commodity price falls had taken their toll on the resource-reliant economy. But a rebound in prices, notably oil, gold and copper, has meant a reversal of fortunes.
“If you look at those three sectors, financials, energy and materials, they have done extremely well. Looking at materials, there are a lot of gold companies in Canada which have had a phenomenal run this year,” says Raman Subramanian of MSCI.