Bristol Gate Canadian Equity Q3 2026 Investor Letter (TSX:BGC:CA)
The Bristol Gate Canadian Equity Strategy faced a challenging third quarter in 2026, trailing the S&P/TSX Composite Total Return Index. While the broader market was buoyed by a small group of high-cap equities, the strategy struggled to keep pace with the benchmark. The S&P/TSX Composite Total Return Index managed a 1.6 percent increase over the three-month period, hitting several all-time highs throughout August before the upward trend lost its steam. By September, the index experienced its first monthly contraction since March.
S&p/tsx Composite Performance
Geopolitical friction dominated the quarter, starting on July 1 when the United States government opted not to renew the CUSMA trade agreement in its existing form. Although the pact remained active during an ongoing review, Washington escalated tensions on July 20 by announcing 50 percent tariffs under Section 338. These levies targeted approximately 20 billion dollars worth of Canadian exports. Following a brief three-day delay, the American tariffs were implemented on August 22. The Canadian government retaliated with its own counter-tariffs on September 8.
Tariffs and Trade Uncertainty
The trade dispute intensified further as September progressed. American officials ordered the removal of Canadian-made goods from federal procurement lists. By September 29, new prohibitions were enforced against specific Canadian imports, including motor vehicles, dairy, and alcohol. In response to the growing economic instability, the Canadian federal government introduced Bill C-39. This legislation is designed to accelerate the regulatory process, aiming to conclude federal reviews for significant infrastructure projects within a single year.
Bill C-39 and LNG Canada
Amidst these trade hurdles, the energy sector saw a major milestone on September 28. Partners in the LNG Canada project reached a final investment decision regarding a second phase. This expansion is expected to double the capacity of the Kitimat terminal, bringing its total output to 28 million tonnes annually. Meanwhile, the commodity markets were defined by significant price swings. West Texas Intermediate crude climbed from roughly 70 dollars per barrel at the end of June to over 90 dollars by July 23. This surge followed a breakdown in hopes for a diplomatic resolution to the conflict between the United States and Iran, which saw attacks on vessels in the Strait of Hormuz and the Red Sea.
Commodity Markets and Geopolitical Conflict
Brent crude prices also surpassed 100 dollars in late September. Gold markets were equally volatile, starting the quarter at 4,058 dollars per ounce before peaking near 4,565 dollars on August 20. However, by September 29, gold futures dropped to a seven-week low of approximately 4,180 dollars. On the macroeconomic front, the Bank of Canada maintained its policy rate at 2.25 percent. Despite this, headline inflation rose from 2.8 percent in June to 3.0 percent during July and August. A primary driver was gasoline, which saw a 25.7 percent year-over-year price jump in July.
Inflation And
Source: seekingalpha.com · 2026-11-05