Market Recap* – Week of August 24, 2026

1. What happened in the markets?

Canadian equities moved lower over the week as investors weighed renewed U.S.-Canada trade tensions and the potential impact of trade tensions on future economic growth. While Canadian economic data remained strong, markets remained cautious about whether that momentum can be sustained amid an uncertain trade backdrop. Sector performance was weighed down by Consumer Discretionary, Energy, and Industrials. These declines were partially offset by strength in Information Technology and Financials, with the latter benefiting from stronger-than-expected earnings reported by major Canadian banks.

U.S. equities moved higher over the week as investors were encouraged by strong corporate earnings results and continued confidence in artificial intelligence-related investment spending. Market sentiment was also supported by expectations that economic growth remains resilient despite ongoing inflation concerns. Sector performance was led by gains in Basic Materials and Utilities. These gains were partially offset by weakness in Communication Services and Consumer Cyclical sectors.

Canadian fixed income markets generated positive returns over the week as investors balanced stronger economic growth data against expectations that the Bank of Canada will maintain its current policy stance. Continued expectations for stable monetary policy and higher inflation supported demand for bonds and contributed to gains across the fixed income market.

Canadian money market investments continued to provide steady positive returns over the week.

The Canadian dollar weakened over the week as renewed trade tensions with the United States and uncertainty around the economic outlook weighed on investor sentiment. Although Canadian economic growth exceeded expectations, markets continued to anticipate that the Bank of Canada will maintain its current policy rate, limiting support for the loonie.

2. What does it mean for Embark Funds?

Asset class	Change	Impact on cohorts
Canadian Equities	↓	Negative for cohorts with higher Canadian equity exposure as weakness across most sectors outweighed gains in Technology and Financials.
U.S. Equities	↑	Positive for growth-oriented cohorts as broad-based sector gains supported market performance.
Bonds	↑	Positive for conservative cohorts as bond prices increased over the week.
Money Market	↑	Continued to deliver modest positive returns, supported by the prevailing interest rate environment.
Canadian Dollar	↓ CAD	Positive for portfolios with foreign currency exposure. A weaker Canadian dollar increased the value of international holdings when translated back into Canadian dollars.