June 2012

The second quarter of 2012 has been difficult for the Canadian equities segment. A correction to the level of commodity prices and the decline in the price of energy have erased the gains made by the Canadian TSX Index since the beginning of the year to clear a negative return of about 3%. Fears of a slowdown in China directly affect the various commodity prices which make up 46% of the Canadian index. The underweight in these sectors in portfolios allowed us to lessen this decline.

Despite a sharp drop in May, the American indices has shown positive performance since the beginning of the year, the economic recovery being slower than expected.

The uncertainty surrounding the eurozone combined with slow world growth contributed to exert pressure on the various indices. This difficult context leads us to manage your capital in a prudent manner and strong volatility explains the higher level of short-term investments.

We continue to promote stocks of companies with higher dividends and a greater distributed capitalization across more defensive sectors, and, given the context of low interest rates, continues to maintain a reduced level of bond sector duration.

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