Market Recap* – Week of August 17, 2026

1. What happened in the markets?

Canadian equities moved lower over the week as rising global bond yields and concerns about inflation weighed on investor sentiment. Despite stronger-than-expected Canadian retail sales, ongoing Canada-U.S. trade negotiations ahead of the tariff deadline, and strength in materials stocks supported by higher gold prices, the TSX finished the week modestly lower.

U.S. equities moved lower over the week, posting their first weekly decline since July. Rising Treasury yields, higher oil prices, and persistent inflation concerns weighed on investor sentiment, while geopolitical tensions involving Iran added to market uncertainty. Sector performance was mixed, with materials and healthcare leading the gains, while technology and industrials were the weakest sectors as higher bond yields weighed on growth-oriented and economically sensitive stocks.

Canadian fixed income markets moved lower over the week, with bond prices declining modestly. Rising bond yields and continued concerns around inflation and government borrowing levels weighed on fixed income markets, contributing to negative returns during the period.

Money market investments recorded modest gains over the week. Supported by prevailing short term interest rates, the asset class continued to provide stable and predictable returns with limited volatility.

The Canadian dollar strengthened over the week as expectations for additional U.S. interest rate increases eased, and Canada-U.S. yield spreads narrowed. Continued progress in trade negotiations between Canada and the United States also supported the currency.

2. What does it mean for Embark Funds?

Asset class	Change	Impact on cohorts
Canadian Equities	↓	Negative for cohorts with higher Canadian equity exposure. Strength in materials was offset by weakness across other sectors, resulting in a modest decline for the TSX.
U.S. Equities	↓	Negative for growth-oriented cohorts. Higher Treasury yields and concerns about inflation weighed on market sentiment, particularly in technology and industrial sectors.
Bonds	↓	Negative for conservative cohorts. Rising bond yields and ongoing volatility in global fixed income markets weighed on bond prices and contributed to modest losses during the week.
Money Market	↑	Continued to deliver modest positive returns, supported by the prevailing interest rate environment.
Canadian Dollar	↑ CAD	Slightly negative for portfolios with foreign exposure. A stronger Canadian dollar reduced the value of international holdings when translated back into Canadian dollars.