Interest Rates, Commodities & a Stronger Fall | The Market this Month (August 2026)

🎉 The August edition of The Market this Month is live - and markets certainly haven’t taken the summer off.

Powered by the Canadian Securities Exchange in partnership with Stockhouse, host Anna Serin is joined by Bruce Campbell of StoneCastle Investment Management to explore the shifting market landscape and the increasingly constructive outlook for the fall.

💡 Spotlight topic: Broadening market leadership and renewed commodity momentum

With investors reassessing the direction of interest rates, market leadership is expanding beyond large-cap technology. Precious metals are beginning to reaccelerate, copper remains strong, and sectors such as software, industrials, and financials are gaining momentum.

📊 Also in this episode:

• Interest rates: How changing expectations are influencing investor sentiment
• Commodities: Why gold, copper, and uranium could be positioned for a stronger fall
• Sector rotation: Market leadership continues to broaden across industries and market capitalizations
• Capital formation: Strong summer financings demonstrate continued demand for compelling growth stories

The CSE also welcomed nine new issuers during the month, while Canadian Copper, Evolve Royalties, Replenish Nutrients, and several other listed companies announced notable financings.

With corporate earnings remaining strong and capital continuing to move into risk-on asset classes, could markets be setting up for an active finish to 2026?

Watch the latest episode of The Market this Month to learn more.

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#CSE #CanadianSecuritiesExchange #Stockhouse #SmallCap #CapitalMarkets #Commodities #Mining #Gold #Copper #InterestRates #MarketOutlook

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Transcript

SPEAKER_01 0:02

The Canadian Securities Exchange presents your go-to source for trends in junior and small cap markets. Each month, join host Anna Saren, the financial expert Bruce Campbell, in partnership with Stocker.

SPEAKER_00 0:16

Hello everyone, and welcome to the August edition of the Market This Month. I'm Anna Saren, Director of Listings Development with the Canadian Securities Exchange, and we've got a lot to unpack this month because markets certainly didn't take the summer off. While August is often thought of as a quieter month, this year has delivered anything but. Investors are weighing a Federal Reserve that continues to hold interest rates steady, ongoing geopolitical tensions that have kept energy markets on edge, and an economic backdrop that's leaving many asking the same question: are we finally setting up for a stronger second half of the year? One of the biggest themes we're watching is another shift in the market leadership. The sector rotation we discussed last month is already evolving. As expectations for inflation and economic growth continue to change, we're seeing renewed interest in commodities. While energy markets remain volatile as global events continue to influence oil prices almost daily. If interest rates begin to stabilize as many expect, it could provide the catalyst that resource investors have been waiting for. Here at the Canadian Securities Exchange, it's also been another exceptionally active month. We were pleased to welcome nine new issuers to the exchange: Lynx Resources, Northern Discovery Metals, Centenario Gold Corp. Abitibi Greenstone Gold Corp, Generation Uranium, Axiom Minerals Corp., New Auras Metals Corp, and Secure 3D Holdings Inc. It's encouraging to see this continued momentum across the mining sector, alongside innovative technology companies choosing the CSE as their public market. Capital raising activity also remains strong. Canadian Copper announced a $44 million project financing with OR royalties. Evolve Royalties secured a $50 million credit facility with the Bank of Montreal, and Replenish Nutrients completed a $7.5 million strategic equity investment with SRC Agri Minerals. We also saw significant financings completed by Nuran Wireless, Allied Critical Minerals, Critical One Energy, Green Bridge Industries, Leaf Brands, Redwood AI, and the Precision Peptide Company, amongst many others highlighting continued investor appetite for quality companies across a range of sectors. The message continues to be consistent. While headlines remain focused on macroeconomic uncertainty, capital is still finding companies with strong assets, compelling growth stories, and experienced management teams. Today, Bruce and I will discuss what the Fed's latest decision means for markets, whether commodities are ready to take the lead, how sector rotation is evolving, and where investors may find the best opportunities as we head into what traditionally one of the busiest periods of the year for capital markets. Joining me once again is my co-host, Bruce Campbell, Portfolio Manager at Stonecastle Investment Management. And joining me once again is Bruce Campbell with Stone Castle Investment Management. Thank you for joining me, Bruce. We're talking here in August of 2026, a smoky time of year for us in BC. I hope uh the air quality where you are is okay. Are you okay, Klona?

SPEAKER_02 3:27

We are certainly smoky. I mean, the entire province seems like it's smoky. I think there's over a hundred fires right now. So it's uh quite the battle that's happening out there.

SPEAKER_00 3:36

Absolutely. Absolutely. Well, I hope everyone around you is safe and um and hopefully we get these fires under control. Um, we're gonna jump right into it. We're gonna talk about something we haven't talked about in a long time is the Fed and interest rates. I feel like there was a period of time, Bruce, where all we talked about was interest rate, um, them going up and down and inflation and all of those things. What are we seeing this summer?

SPEAKER_02 3:59

Yeah, we've had a bit of a reprieve from the Fed talk, haven't we? But what we're seeing is that uh the new Fed chair came in in June and uh really the the market changed its view on what was gonna happen with interest rates as he came in and basically had his first meeting. Prior to that, we thought that interest rates were gonna be be lowered at some point in time this year. And now investors' expectation is that we could see a hike or maybe even two before the end of the year. And there's really a couple of factors there that I think are driving that. One is that that um we've seen the inflation really be sticky and not come down to the degree that the Fed wants to see. They'd like to see below 2%. We're in the threes right now. And then the second is strong economic growth. And they, of course, they want to have interest rates to a level where when we do see an economic slowdown, they can lower rates to stimulate the economy. So I think they're trying to put, you know, what the reference is is put a bullet in their gun effectively so that then they can use it down the road when they need to. But it has been a fairly significant change in um in investor belief or investor expectation on what would happen with rates this year.

SPEAKER_00 5:10

And is this, in your view, a good thing that interest rates might be going up? Does this show some some strength and and uh maybe potentially rallying in the market?

SPEAKER_02 5:19

Well, I think all investors want to see interest rates go down. When we had you know 0% interest rates, it was quite the time for markets, probably a little bit exuberant. If it uh makes sense from an economic standpoint, and the market so far has digested this fairly well. We saw after the the Fed meeting in June, we saw that was the start of the market volatility that lasted through July. And now it seems that the market is kind of shrugging that off. They're um coming to terms with the fact that rates might go up. So that is a good thing given that it will allow uh potentially inflation to be curved. And then the second thing is that it allows them to have more tools available to them when the economy does slow down, because inevitably it will at some point in time, and then they can start to lower interest rates to stimulate growth.

SPEAKER_00 6:07

Gotcha. And when do we find out um if there's a potential hike?

SPEAKER_02 6:11

Well, there's a few meetings left in the year. Um, the next one is uh, I believe in September, if I remember correctly. The concern is that now we're starting to get into politics because there's the midterm election in the US and whether or not they would raise interest rates just before that uh election in November. So we'll have to wait and see. You know, the uh the new Fed chair is seems like he's pretty hard fast on not being political in any way or not being having any political influence in any way. And so perhaps he he does hike it. It'll probably a little bit depend on data as well. That's one of the things the Fed always says is it's data dependent. And, you know, whether or not we start to see some inflation uh moderation between now and then would would also be an impact.

SPEAKER_00 6:53

All right. Well, we'll wait and see. I guess it's something we'll be talking about in September. Um, we did talk about sector rotation last month, but um, it seems like it's shifting again. Tell us what you're seeing there.

SPEAKER_02 7:05

We continue to see you know a fair bit of rotation. So if we go back to to July, prior to July, even if you look into June, this year was really dominated by technology semiconductors in the US. We had that you know move up in in uh commodities in Canada and well globally, but in a lot of the Canadian commodity stocks had moved up really strong into the first quarter and then sold off. And now we're starting to see a rotation. So technology, I'm not saying that the semiconductors are dead, but they certainly had a fairly significant drawdown in July and they've started to rebound here in the beginning part of August. But we're also starting to see other areas of technology. So the software sector that had been really beaten up is now starting to move. But what's interesting is that it looks like a lot of the commodities, uh, especially precious metal commodities, had dropped down, have based, and now they're starting to re-accelerate again. And if we had um an environment where inflation was more moderate, and we also saw an environment where uh you saw interest rates more moderate, then that could be another time for um for the gold stocks and the precious metals companies to start to accelerate. At the same time, we see copper at a fairly high level, and that's really to do with economics, and we're starting to see some of those copper companies really accelerate. And then the third big trend that we continue to see is there seems to be a real follow-through with um with industrials and financials as well. Those are two sectors that they've been doing well, but they've really started to accelerate lately.

SPEAKER_00 8:39

That's amazing. I mean, it sounds like this is all a good priming for a good fall. Um, I mean, to me anyway. What do you think?

SPEAKER_02 8:47

Well, it really broadens things out, which is if you go back 12 months and 18 months ago, now that was one of the things that the bears were constantly throwing up against the wall, was that you know, we had this Mag 7 in the US. It was very narrow leadership, and that the market couldn't survive. It wouldn't, it wouldn't last. And one by one, we've kind of seen things diversify and broaden out. We saw that starting about a year ago now, where the earnings numbers started to really increase across the board, not just in the Mag 7. And so now we're actually seeing new highs in in the first part of August here in the S P and in the equal weight SP, and then also in the TSX as well.

SPEAKER_00 9:28

I love it. It's all good. It's all good. Um, okay, you had touched on commodity, the commodity sector, um, commodities and energy. Um, so let's dive into that a little bit. Uh, could stable interest rates and higher energy prices be the catalyst um that finally does get commodities higher?

SPEAKER_02 9:46

Certainly it seems that that's the case. Like I said, you know, there was such a run-up in the commodity, especially the precious metals commodity prices, and then you know, complete collapse. We've seen that into some of the other areas. So uranium, for instance, has had you know a fairly down move in the last few months. And now you're starting to see basing, but also you've seen gold where it's kind of bounced around that 4,000, bounced off that 4,000 level. And now it's starting to perk up into the mid, you know, kind of 4,200, 4,300 range, which again, given the damage that's been done to the to the gold stocks, that sector is really primed. And at the same time, we should expect to see drilling results from all the explorer uh co's here that come out from all their drilling programs. So it could provide for a fairly exciting uh fall if everything transpires the way it looks like it's going to.

SPEAKER_00 10:39

I mean, I don't know the numbers for for the duration of the summer, but I mean, just this past month, as I mentioned, we had nine new issuers. I believe eight of them are in the resource sector. Um, we talked about this last month and the month before as well. So we've had a very healthy summer at the Canadian Securities Exchange in the mining sector of new companies coming to market, on top of which we've also seen, as we've talked about the past few months, um, really healthy, robust financings uh for issuers, which typically we don't see these types of financings for our resource-focused issuers in the middle of summer. I mean, to me, that seems like um that that seems a bit different. Normally, our our resource-focused issuers are raising capital in the spring so that they can get up or down to the properties um during the summer and and and do their drill programs and and quite heavily focused on that. But does that seem a bit of a new um uh a new environment for you uh to see this kind of financing mid summer?

SPEAKER_02 11:36

Well, it's certainly a healthy environment. Any time that you can bring money and raise money, especially in the summer, it's a really positive sign. And there's, you know, there's been some clearly big issues and there's been lots of issues that were small that got upsized, which is great to see. That's again a result of and a byproduct of a healthy market when you can see that new money coming into the market, into those sectors, and it can come in even at a time when there's not as many people in the office.

SPEAKER_00 12:09

Yeah, and I mean, you know, I I wanted to ask you your question. We talk about, you know, the geopolitical landscape that keeps evolving. Um, you know, how much of this uh story with the US and Iran do you think is affecting potential uh commodity prices?

SPEAKER_02 12:25

Yeah, it's it's had a big impact on certain spot commodity prices. Things have moved up and down, but also just the volatility. Anytime that you have that volatility and it it tends to be almost binary, investors tend tend to get a little bit complacent and just sit back in cash and watch while they wait for stability. But once you see trends emerging, there's so much money sitting on the sidelines that investors then jump on those trends and they can move really quickly and create return in a very short period of time. And I think that's what's happening. And I, you know, I think there's there's that rotation that we just talked about is happening in multiple different areas that can drive returns.

SPEAKER_00 13:10

Yeah, absolutely. Um, okay, let's talk about looking ahead. I mean, you kind of touched on what we might see in the fall, but um, you know, the next time you and I sit down and chat will be the beginning of September, which is traditionally a very busy time in the markets in general. I think in most sectors, um, you know, September, October, November, we see a lot of the movement. So what are your thoughts as we go into the fall? I hate saying that, by the way, because I'm hoping that it takes us a very long time to talk. It's September. But what are your thoughts going into the fall for the markets?

SPEAKER_02 13:41

Yeah, we're quite constructive on the period from September right through year end and into January. And there's a number of reasons for that. One is if you look at earnings and the underlying earnings trends of the market, they that that broadening started a year ago when we started to see the Q2 numbers reported. And that's when the market really broadened out and we started to see movement across market capitalizations and sectors. We think that that's going to continue based on the forecasts that companies see right now, that they have a couple of quarters of visibility, and they're saying that those numbers still look very strong. So we should see strong economic or strong earnings numbers going into the next two quarters. At the same time, we look at a number of different growth of economic growth numbers and inflation numbers. And while inflation hasn't calmed the way we would like, it's it has certainly moderated. And we think that that's gonna be the case unless we were to see some spike in oil that really pushed it to the next level. That seems to be under control. And then economic growth, it looks like that economic growth is going to continue. So we're setting ourselves up for a very nice environment where a lot of asset classes that are more risk-on, so commodities, technology, financials, a lot of those should have strong performance going into the fall.

SPEAKER_00 15:04

Well, that's pretty exciting stuff to hear. I mean, it it seems like there is a lot going on, but the markets are still um trucking along this summer. Um, and hopefully we have a great fall ahead of us. Um, Bruce, thank you so much. It's always a pleasure to chat with you, and I look forward to seeing you in September. Um, I hope that you have a very long and slow August.

SPEAKER_02 15:25

Yeah, thank you. Yeah, exactly.

SPEAKER_00 15:27

We'll talk soon.