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 Horizons Marijuana Life Sciences Index ETF (HMMJ.TO) & Franklin FTSE Mexico ETF (FLMX)

Coming out of Martin Luther King Day and moving through Inauguration Day, US markets have resumed their upward course. Initial earnings reports have generally been meeting and beating expectations and yesterday’s rally in Netflix shows that investors are still prepared to respond to positive news.

With the change in power in the US completed and the Democrats pushing ahead with their agenda, investors may be anticipating an easier path to more fiscal stimulus in the coming months. This week, we are also scheduled to hear from the Fed on Wednesday who may hint on their monetary support plans for the coming year. The first half of the week is very light for economic news, but the back half brings US GDP on Thursday and Canada GDP plus Chicago PMI on Friday as the end of January approaches.

The Bank of Canada this week raised concern that increased lockdowns could make economic conditions worse in Q1 than previously thought but it was also optimistic that easing restrictions and vaccine rollouts could help the economy to recover more quickly later in the year. The Bank of Canada maintained current levels of emergency support (low rates plus asset purchases) and suggested that the conditions for an increase (inflation returning toward 2%) have been pushed out to 2023. We could see similar commentary from the Fed next week.

The coming week sees earnings season start in Canada with the two big railroads set to report, and accelerate plus broaden out in the US to include senior companies from several sectors including: credit cards, aerospace, consumer products, Big Oil, Big Tech, restaurants, industrials and others. Headliners include: General Electric, Microsoft and CN Rail on Tuesday, CP Rail, Apple, Boeing, Facebook and Tesla on Wednesday, Rogers, Visa, Mastercard and McDonalds on Thursday, wrapping up with Caterpillar and Chevron on Friday the 29th.

In this week’s issue of Equity Leaders Weekly, we look at how the change in power in the US has influenced sentiment toward marijuana stocks and Mexican stocks.

Horizons Marijuana Life Sciences Index ETF (HMMJ.TO)

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