TORONTO, July 31,
2024 /CNW/ - RBC Investor Services (RBCIS) reports a
positive return of 1.1% for its clients' defined (DB) pension plans
during the second quarter of 2024, and a 4.4% return for the first
half of 2024. This analysis, which RBCIS reports on following each
quarter, encompasses various client plans across private and public
sectors.
Global equities for client plans generated gains of 3.1%,
slightly underperforming the MSCI World Index, which returned 3.8%
and was led by the Information Technology (12.6%) and Communication
Services (9.3%) sectors. Similar to Q1, growth style stocks
outpaced their value counterparts with the MSCI World Growth up
7.5% compared to MSCI World Value - 0.1%. From a regional
perspective, U.S. equities outperformed their international
counterparts, as evidenced by the S&P 500's gain of 5.4%,
primarily driven by the robust performance of the Information
Technology sector versus the MSCI EAFE's 0.7% return.
Canadian equities for RBCIS DB pension plans lagged their global
counterparts and experienced a negative return of 0.6%, aligning
with the TSX Composite Index's - 0.5% return. Weakness in the
Financials (-1.2%) and Industrials (-3.4%) sectors overshadowed
gains in the Materials (+7.4%) sector.
Turning to the Canadian fixed income asset class, RBCIS DB
pension plans returned 0.8% aligning with the FTSE Canada Universe
Bond Index, which experienced a return of 0.9%, rebounding from its
negative return in Q1, primarily due to the Bank of Canada's interest rates adjustment in June.
Short-term FTSE Canada Universe bonds (1.2%) outperformed long-term
bonds that remained nearly flat with a 0.2% return.
"This analysis emphasizes the complexities of the Canadian
pension landscape, and the importance of diversifying, and
proactive risk management," said Isabelle
Tremblay, director, Client Solutions, Asset Owner Segment
Lead at RBCIS. "The market continues to experience volatility due
to ongoing geopolitical tensions. Inflation trended favourably in
Q2 following the June Bank of Canada rate cut. With the consecutive rate
adjustment announced in July, plan managers are continuing to adapt
their strategies and navigate the evolving environment."
About RBC
Royal Bank of Canada is a global
financial institution with a purpose-driven, principles-led
approach to delivering leading performance. Our success comes from
the 98,000+ employees who leverage their imaginations and insights
to bring our vision, values and strategy to life so we can help our
clients thrive and communities prosper.
As Canada's biggest bank and one of the largest in the
world, based on market capitalization, we have a diversified
business model with a focus on innovation and providing exceptional
experiences to our more than 18 million clients in Canada, the
U.S. and 27 other countries. Learn more at rbc.com.
We are proud to support a broad range of community initiatives
through donations, community investments and employee volunteer
activities. See how at rbc.com/community-social-impact.
About RBC Investor Services
RBC Investor Services
delivers asset servicing solutions to Canadian asset managers and
asset owners, investment counsellors and other financial
institutions. Part of Royal Bank of Canada, Canada's largest bank and one of the top 10
banks globally, our focus is on safeguarding the assets of our
clients and supporting their growth. RBC Investor Services has over
C$2.4 trillion of assets under
administration. Learn more at rbcis.com.
SOURCE RBC Investor Services