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Summary

• Geopolitical risks mean investors need to be prepared for market volatility.
• That said, a stronger consumer may continue to buoy the economy.
• The future path of rates may also dictate the direction of the markets.

Investors today are weighing rising geopolitical risk against what is expected to be resilient corporate earnings. Justin Flowerday, Head of Public Equities for TD Asset Management, joins MoneyTalk to discuss how to position portfolios when headlines clash with balance sheet strength.

Transcript

Antony Okolie: Well, market volatility has picked up as investors weigh geopolitical risks along with a potential path of interest rates and corporate earnings season. Joining us now to discuss what investors need to keep in mind is Justin Flowerday, Managing Director and Head of Public Equities with TD Asset Management. And Justin, welcome to the show. I think this is the first time you and I have been on together.

Justin Flowerday: Great to be here, Tony. Thank you.

Antony Okolie: Alright, so let’s start with what’s happening in the markets. We’re seeing some selling pressure today as markets are focused on geopolitical risk. How should investors be thinking about the current environment?

Justin Flowerday: Yeah. So as you mentioned, investors are reacting to Trump’s escalated tariff threats over Greenland and the possibility what that means for higher tariffs for Europe. I’m not going to hash out all the details. They’ve been all over the news. But we have another headline which is producing a higher level of volatility. We’ve seen the VIX, which is a measure of volatility, back through 20.

But I do want to be very, very clear here. This is the new normal, and investors need to be aware of that. Whether it’s Greenland, whether it’s Venezuela, whether it’s Middle East tension, whether it’s China-US tensions, we’re no longer in the post Cold War era where governments are being passive and letting private market forces dictate all things about the economy and the markets. They’re getting much more active.

And for investors, this is

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