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(July 21, 2006) Investor Group has added two new Canadian equity funds to its product lineup: Investors Canadian Growth and IG Mackenzie Maxxum Canadian Equity Growth.

The funds, also available in corporate class versions, will invest primarily in growth-oriented Canadian companies and will be guided by portfolio managers who have experience and expertise in overseeing similar funds, the Winnipeg-based company said in a release.

The new offerings have been approved by regulators and are now available for sale.

The unit trust funds have also been added to a select number of Investors Group’s Alto and Allegro portfolio funds.

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Pension funds underperformed in second quarter

(July 21, 2006) A recent RBC Dexia survey of institutional investors has found that pensions funds reined in exposure to the speculative, but better performing, energy and materials sectors while remaining overweight in the financial sector during the second quarter of the year. This coupled with interest rate jitters, global stock market corrections and the strengthening loonie, erased 3.1% from the value of Canadian pension funds in the quarter ending June 2006.

During the quarter, global stocks slipped 3% in local currency terms. Translated into Canadian dollars, the losses grew to 5%. Canadian equity markets also stumbled, dropping 3.5%. Information technology plunged 21.5%, but it was the 7.1% decline in widely-held financial stocks that had the greatest overall impact. In domestic bonds meanwhile, speculation about further interest rate hikes triggered another sell off, resulting in a 1.1% loss on the quarter.

Overall, pension funds underperformed the S&P/TSX Composite Index by 0.4%. Within the $340 billion worth of funds measured by Dexia, year-to-date investment returns are barely positive at 0.9%, “But to put these results into perspective, this is the first negative quarter in over three years and the median Canadian pension fund is still up a healthy 11.4% for the period,” says director of advisory services, Don McDougall. “Fortunately, most Canadian pension funds remained under exposed to the U.S. market and that helped mitigate the damage.”

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Gas prices slow inflation

(July 21, 2006) Statistics Canada economists say Canadians paid 2.5% more for goods and services listed in the Consumer Price Index basket in June 2006 than they did at the same time last year. This was slower than the 12-month change of 2.8% reported in May.

Gasoline and natural gas prices were the main contributors to the drop in inflation. The rate of increase in gas prices slowed from 18.6% in May to 15.4% in June, affecting year over year change in the index.

Even though prices slowed somewhat, higher gasoline prices were again the main factor behind the 12-month CPI increase in June. In the wake of a 14.1% rise from May 2005 to May 2006, the energy index reported a relatively smaller increase of 11.5% between June 2005 and June 2006. Saskatchewan reported the largest increase of 19.5% while Quebec reported the lowest rate of increase, just above 12%.

Excluding the eight most volatile components of the index, the CPI rose 1.7% between June 2005 and June 2006, following a 2% increase reported in May. Excluding energy, the 12 month change in the CPI dropped form 1.8% in May to 1.5% in June, thanks to a 1.1% drop in the cost of purchase and leasing of automotive vehicles, cheaper traveler accommodations and a drop in the price of clothing. The downward pressure was offset by a 4% rise in the prices of fresh fruit and a 0.7% jump in homeowners replacement cost — the worn-out structural portion of housing that is estimated using new housing prices.

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