Market Recap* – Week of January 5, 2026

1. What happened in the markets?

Canadian equities ended the week higher as investors looked past weaker domestic data and focused on the broader economic outlook. The December jobs report showed slower hiring and a higher unemployment rate, reinforcing signs that economic momentum in Canada is easing. Markets appeared to absorb the data calmly, with expectations shifting toward a more supportive policy environment rather than a sharp slowdown.

U.S. equities rose over the week and reached new highs. Slower job growth in December was viewed as a sign that the economy is cooling gradually without stalling, which supported investor confidence. In addition, energy and geopolitical developments were in focus after U.S. policy discussions related to Venezuela highlighted potential changes to global oil supply dynamics. These developments added to broader market interest in the energy sector and contributed to active trading during the week.

Canadian fixed income prices increased during the week. Softer labour market data led investors to reassess the growth outlook, which supported demand for bonds. Price gains reflected a more cautious tone as markets responded to signs of slowing economic activity.

Money market instruments recorded small price gains over the week. Short-term conditions remained stable, and investors continued to favor low-risk assets amid uncertainty around economic growth and future policy direction.

The Canadian dollar weakened against the U.S. dollar from early January through the end of the week. Currency movements reflected shifting expectations around relative economic conditions and policy paths in Canada and the United States following the release of employment data.

2. What does it mean for Embark Funds?

Asset class	Change	Impact on cohorts
Canadian Equities	↑	Positive for younger cohorts with higher equity exposure. Markets looked past weaker labour data, with sentiment supported by expectations of more accommodative condition.
U.S. Equities	↑	Beneficial for younger, growth-oriented cohorts. U.S. equities rose as investors interpreted slower job growth as consistent with a gradual economic slowdown rather than a sharp downturn.
Bonds	↑	Price gains benefited older cohorts focused on stability and capital preservation, as softer economic data increased demand for defensive assets.
Money Market	↑	Modest price gains supported older cohorts seeking low-risk, stable returns amid uncertainty around growth and policy direction.
Canadian Dollar	↓ CAD	A weaker Canadian dollar slightly boosted foreign return tailwinds for growth-oriented portfolios.