The Week of October 21 – October 25, 2019

William Chin, MBA

Portfolio Manager & Chief Technical Analyst

William Chin, Chief Technical Analyst for Caldwell Investment Management Ltd. (“Caldwell”), is the lead Portfolio Manager on the Tactical Sovereign Bond Fund and Portfolio Manager for the fixed income portion of the Caldwell Balanced Fund. He also advises fixed income portfolios for affiliate Caldwell Securities Ltd.’s separately managed account platform and contributes to the Caldwell Investment Management Ltd. team’s research, specializing in macro-economics, currency risk management and technical analysis. William is a member of Caldwell’s Investment Risk Committee.
William has over 35 years of international investment experience in the areas of portfolio, currency risk and treasury management. He began his career in the currency market, progressing to the role of treasury manager for a large international bank. He was first registered as a Portfolio Manager with the Ontario Securities Commission in 1999 and managed high net worth client portfolios on a discretionary basis prior to joining Caldwell.
William has an MBA in economics and international finance. He has been a volunteer and a board member for the Canadian Society of Technical Analysts since 2001 and is their former President (2012-2014).
William is a frequent speaker on macro analysis, monetary policy and technical analysis.

Macro Update

• The Federal Election produced a Liberal minority government, which was widely-expected.
• The Bank of Canada’s ‘Business Outlook Survey’ Fall edition’s ‘overall outlook index’ came in at +0.4. The survey was conducted from late August to early September so it is obsolete. Just to be even more obsolete, the Summer ‘overall outlook index’ was revised down from +0.2 to -0.1. The Summer release, originally at +0.2, was touted as ‘returning to historical average’ after the Spring slump but now it is revised significantly lower. The Bank of Canada relies heavily on this survey to formulate monetary policy, another reason why the Bank is often, if not always, behind the curve.
• Canada August retail sales fell 0.1%; excluding autos and gas stations, sales also fell 0.1%.
• Canada August wholesale sales fell 1.2%. July was revised down from a 1.7% gain to 1.4%. Volatile series but this is the second largest decline in 4 months. Sales fell in 5 of 7 sectors.
• U.S. September ‘durable goods orders’ fell 1.1%. The important ‘nondefense capital goods excluding aircraft’ (best proxy for business investment spending) fell 0.5%; August was revised down from a 0.4% drop to a 0.6% decline.
• U.S. August house price index rose 0.2% in August, growing at 4.6% y/y.
• U.S. September ‘existing home sales’ fell 2.2%.
• Germany manufacturing purchasing managers’ index fell again. France made it up by posting a small improvement. The overall Eurozone index is unchanged at 45.7, still quite deep in contraction territory.
• South Korea, the canary in the coal mine, saw its GDP grew by 0.4% in Q3, after a 1.0% increase in Q2. Its imports and exports have been plunging due to global trade turmoil.