Staying focused through changing markets
At Orca Wealth, we believe successful investing is not about reacting to every headline. It is about understanding what has changed, determining what matters, and keeping your long-term financial plan on course.
This week brought encouraging signs for the Canadian economy, although slower growth, geopolitical tensions and uncertainty surrounding Canada–U.S. trade remain important risks.
Bank of Canada Holds Interest Rates Steady
The Bank of Canada maintained its overnight interest rate at 2.25%, marking its sixth consecutive decision without a change.
The Bank expects economic growth to improve during the second half of the year as inflationary pressures gradually ease. However, it reduced its forecast for Canadian economic growth in 2026 to 0.7%, reflecting the economy’s weaker start to the year.
What This Means for Investors:
Stable interest rates provide greater predictability for borrowers, homeowners and businesses. They may also continue to support:
Dividend-paying companies
Utilities and infrastructure investments
Real estate investment trusts
High-quality bonds and guaranteed income investments
Investors should not assume that rate increases or cuts are imminent. The Bank of Canada continues to balance slower economic growth against inflation risks created by oil prices, trade uncertainty and geopolitical events.
Canada’s Employment Market Remains Resilient
Canadian employment increased by approximately 18,000 jobs in June, while the unemployment rate declined slightly to 6.5%.
Employment gains were concentrated among younger and core working-age Canadians, although employment declined among workers aged 55 and older.
What This Means for Investors:
The employment numbers suggest that the Canadian economy is stabilizing rather than entering a severe downturn.
A reasonably healthy employment market can support:
Consumer spending
Mortgage and loan payments
Bank earnings
Business confidence
Corporate profitability
The labour market is not exceptionally strong, but it remains more resilient than many investors had feared earlier in the year.
Canadian Markets Remain Near Record Levels
The S&P/TSX Composite continued trading near record territory, supported this week by gains in technology, materials, financial and mining companies.
On July 15, the index opened above 35,400, while an earlier rally was led by financial and gold-mining shares.
What This Means for Investors:
The TSX continues to benefit from its exposure to banks, energy producers, mining companies and dividend-paying businesses.
However, strong recent market performance does not mean every company represents good value. Investors should remain selective and avoid taking excessive risk simply because markets are rising.
At Orca Wealth, our approach remains:
Core, Then Explore
Build the core of the portfolio around quality, diversification and dependable long-term investments. More specialized or higher-risk opportunities should complement the core—not replace it.
Oil and Geopolitical Risk Remain Important
Oil prices continue to be influenced by developments in the Middle East. Higher energy prices can benefit Canadian oil and gas producers, support the Canadian dollar and strengthen government revenues in energy-producing provinces.
However, persistently higher oil prices can also increase transportation, food and manufacturing costs. The Bank of Canada has identified elevated oil prices and Canada’s evolving trade relationship with the United States as two of the most important risks to its economic and inflation outlook.
What This Means for Investors:
Energy remains an important component of the Canadian market, but oil prices can change quickly.
Rather than attempting to predict each geopolitical development, investors should maintain appropriate energy exposure within a diversified portfolio.
Canada–U.S. Trade Remains a Key Risk
Canada’s economy continues to face uncertainty surrounding its trading relationship with the United States.
Manufacturers, exporters and businesses with complex cross-border supply chains may be particularly sensitive to changes in tariffs, trade rules and consumer demand.
What This Means for Investors:
Companies with strong balance sheets, dependable cash flow and pricing power should be better positioned to manage an uncertain trade environment.
Investors should also avoid concentrating their entire portfolio in one country. Canadian investments remain important, but exposure to the United States and international markets can provide access to industries that are less represented in Canada.
Western Canadian Real Estate Update
Canadian home sales increased by 0.5% in June, following stronger increases in April and May. National sales activity was approximately 7% higher than it had been in March.
In British Columbia, 7,225 residential properties were sold in June, an increase of 0.9% compared with June 2025. B.C. inventory remains relatively high, giving buyers more choice and limiting broad price pressure.
Calgary sales improved from May but remained nearly 4% below the previous year. Conditions differed considerably by property type, with apartment-style properties experiencing more pressure than other segments.
What This Means for Property Owners:
Western Canadian real estate is not one uniform market. Conditions vary significantly by city, neighbourhood and property type.
For retirees and pre-retirees, real estate decisions should be considered as part of the complete financial plan, including:
Mortgage and carrying costs
Tax consequences
Retirement cash-flow requirements
Estate planning
Liquidity and diversification
The financial impact of downsizing or relocating
A home can be an important asset, but it should not be the only source of retirement security.
Warren Buffett’s Reminder
“Price is what you pay. Value is what you get.”
Periods of uncertainty often encourage investors to focus on short-term price movements. Long-term wealth is more commonly built by owning quality investments, paying reasonable prices and allowing time and compounding to work.
Our Perspective
This week’s financial news is cautiously encouraging.
Interest rates are stable; employment remains resilient and Canadian markets continue to perform well. At the same time, economic growth is modest and risks involving inflation, oil prices and international trade have not disappeared.
This is not a time for complacency, but it is also not a time for fear.
For most investors, the appropriate response is to:
Remain invested
Maintain adequate diversification
Review portfolio risk
Rebalance when necessary
Keep sufficient short-term liquidity
Focus on long-term financial objectives
A properly constructed portfolio should be designed to participate in rising markets while remaining resilient when conditions become more difficult.
A Question Worth Considering:
Does your current portfolio still reflect your retirement timeline, income needs and tolerance for market fluctuations?
Markets change—and personal circumstances change as well. A regular portfolio review can help ensure that your investments remain aligned with the life you are planning.
To arrange a confidential review, please contact Orca Wealth and Insurance Services.
Orca Wealth and Insurance Services
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This newsletter is provided for general information only and does not constitute personalized investment, insurance, tax or legal advice. Investment values can fluctuate, and past performance does not guarantee future results. Please consult the appropriate professional regarding your individual circumstances.
