Monthly Portfolio Update July 2026

A lightbulb with a $ filament and dollars at the bottom of the bulb goes on for bulls and bears.

Monthly Market and Portfolio Review

Indexes	Monthly Streak
TSX:	4 – month winning streak
S&P:	2 – month losing streak
DJIA:	4 – month winning streak
Nasdaq:	2 – month losing streak

July was a month of shifting investor preferences, with the major indexes moving in noticeably different directions. The Toronto Stock Exchange Composite Index (TSX) and Dow Jones Industrial Average (DJIA), with their greater exposure to traditional companies, extended their monthly winning streaks. Meanwhile, the more growth-oriented S&P 500 Index (S&P) and Nasdaq Composite Index (Nasdaq) extended their monthly losing streaks. Beneath those headline numbers, investors weren’t necessarily moving out of stocks. They were changing what they wanted to own.

Artificial intelligence (AI) remained the biggest story of the month. After a strong first half, investors hit the pause button on the AI-driven rally. The central question shifted from “How fast is AI growing?” to “When will these massive capital expenditures turn into profits?” Investors shifted some money toward dividend-paying financials, industrial companies, and other areas less dependent on AI spending, giving the DJIA a relative boost.

As second-quarter earnings season got underway, strong revenue and profit growth from several technology companies reassured investors that demand for AI is still strong. At the same time, the enormous costs of building AI infrastructure remained a concern. This tug-of-war between AI’s potential and its price tag contributed to sharp swings in technology stocks.

Despite those concerns, corporate earnings told a surprisingly strong story. More than 85% of S&P companies reporting during July beat consensus earnings estimates, with strength extending well beyond technology into energy, insurance, consumer discretionary and financials. The broad-based results helped support the market.

Economic data painted a generally resilient picture. Inflation showed signs of easing, while employment and consumer spending suggested the American economy remained healthy. Investors also watched the Federal Reserve for clues about interest rates. A resilient economy, moderating inflation and relatively stable rate expectations supported stocks, although investors remained alert to signs that inflation could return or growth could weaken.

Geopolitical tensions in the Middle East added another source of uncertainty. Oil prices surged in the middle of the month, raising concerns that higher energy costs could push inflation higher again. While this benefited energy producers, it created a headwind for growth stocks. New US tariffs and uncertainty surrounding global trade added to the caution and contributed to several volatile trading sessions.

In Canada, the TSX benefited from its different sector mix. Rising oil prices provided a major boost to energy producers, potentially increasing revenues and profits in one of the index’s largest sectors. Basic materials, home to many of Canada’s mining companies, also provided support as gold remained at historically elevated levels early in the month, helping push the TSX to a record high before mining stocks became more volatile. Financials added further support, with Canada’s major banks and insurers benefiting from a stable interest-rate environment. The Bank of Canada held its policy rate at 2.25% in July while noting signs of improvement in the economy.

July showed why looking beyond headline index numbers matters. American investors became more selective about technology stocks and questioned whether massive AI investments would deliver enough profits to justify their cost. In Canada, energy, basic materials, and financials provided a stronger tailwind. Investors weren’t necessarily moving out of stocks. They were shifting toward companies and sectors where they could see stronger earnings and a clearer path to profits. This sector rotation, where investors move money from one part of the market to another, can produce quite different results for different indexes even when they are responding to the same economic and global events.

Portfolio	Monthly Streak
Portfolio 1:	1 – month losing streak
Portfolio 2:	4 – month winning streak
Portfolio 3:	1 – month losing streak

[bear/ Just as the markets had a mixed month, so did my three portfolios. And like the major indexes, the portfolios showed how different sector exposure can produce very different results, particularly when technology stocks fall out of favour.

Portfolio 1 started July strongly before a mid-month pullback erased those gains and then some, leaving it down 0.9% for the month. It ended July with a positive week, but that wasn’t enough to extend its monthly winning streak. Semiconductor weakness, including a decline in Nvidia (NASDAQ: NVDA), weighed heavily on the portfolio, while Apple (NASDAQ: AAPL) added to the volatility. Strong performances from companies such as Amazon (NASDAQ: AMZN), CrowdStrike (NASDAQ: CRWD) and Constellation Software (TSE: CSU), along with the portfolio’s diversification, helped limit the damage.

Portfolio 2 had a more unusual month, bookending a three-week losing streak with strong winning weeks to start and end July. Those gains were enough to produce a 1.7% monthly increase and extend its winning streak. Its lower exposure to technology helped cushion the impact of the sector selloff, while financial and energy holdings provided support. Bank of Nova Scotia (TSE: BNS) and iA Financial (TSE: IAG) both reached new record highs. Microsoft (NASDAQ: MSFT) and MongoDB (NASDAQ: MDB) remained major influences, delivering strong gains at times but also adding to the portfolio’s volatility.

Portfolio 3 followed a similar path to Portfolio 1, with two winning weeks followed by two down weeks before ending the month on a positive note. That wasn’t enough to prevent the portfolio from losing 0.8% in July. Strong early gains from space and technology stocks were followed by a pullback, with Rocket Lab (NASDAQ: RKLB) and MDA Space (TSE: MDA) providing some eye-catching gains before giving back some of their progress. Microsoft and Nvidia also provided support at various points, while declines in several growth and technology holdings, including Vertiv (NYSE: VRT), weighed on the portfolio. Energy stocks and Royal Bank of Canada (TSE: RY) helped cushion the weakness.

Perhaps the most interesting result was Portfolio 2, which outperformed the other two portfolios despite suffering three weekly losses. It is a good reminder that limiting losses can be just as important as capturing gains. A portfolio doesn’t have to win every week to deliver strong long-term results. Avoiding the big losses can make a significant difference when the market eventually turns higher again.

Monthly Portfolio & Index performance — Chart 1: **July 2026 Portfolio Performance Compared to Major Market Indexes**
A comparison of the monthly returns of my three portfolios and the major market indexes.

Year To Date

Seven Months YTD Portfolio & Index performance — Chart 2: **2026 Year-to-Date Portfolio Performance Compared to Major Market Indexes**
A comparison of the year-to-date returns of my three portfolios and the major market indexes

July reshuffled the year-to-date leaderboard, with the TSX taking over the top spot after rising oil prices gave Canadian stocks a boost. The TSX ended July up 11.1% for the year, ahead of the S&P 500 at 9.4%. The DJIA and Nasdaq were tied at 9.2%, although the DJIA takes third place when the numbers are extended to another decimal. The DJIA had a particularly strong July, increasing its year-to-date gain from 8.9% at the end of June. The Nasdaq, on the other hand, gave back some of its earlier gains, falling from 12.8% at the end of June to 9.2%.

The July pullback also trimmed the gains in all three portfolios. Portfolio 1 is still my top performer despite falling from 13.7% to 12.7%. Portfolio 2 slipped from 13.4% to 12.5% but narrowed the gap with Portfolio 1 to just 0.2 percentage points. Portfolio 3 fell from 6.0% to 5.2% and remains well behind the other two.

Despite the July setbacks, there is still a positive takeaway. Portfolios 1 and 2 remain ahead of all four major indexes for the year, while Portfolio 3 continues to trail the pack.

What My Three Portfolios Did in July 2026

Portfolio 1 for July 2026: DOWN

Activity

Sold: The Trade Desk (NASDAQ: TTD) Please see July 31 Weekly Update

Dividends Received this month:

Companies followed by DRIP (Dividend Re-Investment Plan) indicate additional shares were purchased with the dividend. Any cash leftover was added to the cash balance.

Canadian $

Telus (TSE: T) DRIP

iShares S&P/TSX Global Gold Index ETF (TSE: XGD)

Dream Industrial Real Estate Investment Trust (TSE: DIR.UN)

BSR Real Estate Investment Trust (TSE: HOM.U)

Decisive Dividend (TSE: DE) DRIP

BCE Inc. (TSE: BCE) DRIP

US $

No US$ dividends this month.