Good afternoon,

After a very volatile weekend, markets opened today reacting to a sharp escalation in the Middle East.

Over the weekend, the U.S. launched a major strike against Iran’s leadership and military infrastructure. In response, Iran carried out missile and drone activity across parts of the Gulf region, including near major economic hubs such as Dubai and Doha.

At this stage, the situation remains tense but regionally contained. Importantly, major global powers — including China and Russia — have not directly entered the conflict. Regional players such as Saudi Arabia and Turkey have also not escalated involvement. That containment has been a key relief factor for markets.

Over the weekend, futures markets sold off sharply as investors priced in worst-case scenarios. However, as trading began and it became clearer that this conflict remains limited to the Middle East, sentiment improved. Most North American markets opened deep in the red but recovered throughout the day. By the close, Canadian and U.S. markets had turned positive, apart from the Dow, which finished slightly negative. That is a far cry from the tone of weekend trading and is a constructive sign.

In speaking with several analysts, the general view is that this is unlikely to become a drawn-out, multi-year conflict. The expectation — and hope — is that we are talking about a matter of weeks, possibly a month at most. This is not being viewed as an Afghanistan-style engagement or a prolonged Ukraine-Russia type of war. If that assessment proves correct, markets should gradually normalize as uncertainty fades and as the leadership transition inside Iran becomes clearer.

From a portfolio standpoint, I did not make any major changes today. I try not to trade on emotion, and at times like these markets are largely driven by headlines and uncertainty. Reacting impulsively can do more harm than good.

Over the past few weeks, we had already made several proactive adjustments:

• We significantly increased our energy exposure. That positioning is benefiting from higher oil prices.

• We allowed our precious metals positions to run, and they are also performing well in the current environment.

• We reduced exposure to the NASDAQ and shifted toward an equal-weight S&P 500 approach, increasing exposure to smaller and mid-sized companies. I believe this provides broader diversification and may act as a buffer if volatility continues.

In short, we acted proactively rather than reactively.

Uncertainty has not disappeared, and escalation risks remain. However, some of the worst-case scenarios feared over the weekend have not materialized. What we often see in moments like this is a sharp initial sell-off followed by a steady recovery as markets reassess the actual scope of the risk. That pattern played out again today.

Whether the coming weeks validate this view fully or not, I believe we are adequately and thoughtfully positioned for the current environment.

We will continue to monitor developments closely and update you as needed.

Mark