This is the midday brief for Tue, May 12, 2026. View latest

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Midday Edition. Tuesday, May 12, 2026

Market context for passive investors.

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$43.06
-0.85%

Headline

Hot inflation and fading peace hopes pull XEQT down broadly.

XEQT is trading at $43.06, down 0.85% through midday, with all four sleeves in the red. The heaviest single drag is the U.S. sleeve, off 0.69% and contributing roughly 0.31 percentage points of the decline, as a hotter-than-expected April inflation report and dimming hopes for a Middle East resolution have weighed on Wall Street. Emerging markets are adding nearly equal damage despite their smaller weight, with South Korean and Taiwanese equities sharply lower. The net result is a session running about 1.3 times the fund's recent average daily move.

How large is this afternoon's move?

Larger-than-usual day · This afternoon's -0.85% move is 1.3× the 20-day average move.

This scale measures size, not what to do. Larger moves are a normal part of holding a global all-equity fund.

The Regions

  • Canada

    25.34% of XEQT

    • XIC.TO
    -0.35% -0.09 pts from XEQT

    Canada is the session's most contained sleeve, down 0.35% and contributing roughly 0.09 percentage points of the loss. Materials and information technology are the main drags, falling 1.90% and 2.35% respectively among the sectors tracked, while energy is providing a meaningful offset, rising 1.76% in line with WTI crude's 3.84% advance above $101.

    Canada market region icon

  • United States

    44.92% of XEQT

    • XTOT.TO
    • ITOT
    -0.69% -0.31 pts from XEQT

    The U.S. sleeve is down 0.69%, with technology falling 3.71% among tracked sectors and accounting for the bulk of the pressure. Health care is the notable counterweight, rising 2.38%, and financials and consumer staples are also positive, limiting the damage. The inflation data is consistent with the technology-led weakness and the rotation toward more defensive sectors visible in the breakdown.

    United States market region icon

  • Intl Developed

    24.53% of XEQT

    • XEF.TO
    -0.87% -0.21 pts from XEQT

    International developed markets are off 0.87%, contributing 0.21 percentage points to the decline. Losses are broad across Europe, with the Netherlands down 3.35% and Germany and Australia each off more than 1.6% among tracked markets. Japan is a relative steadier at minus 0.76%.

    Intl Developed market region icon

  • Emerging Mrkts

    5.04% of XEQT

    • XEC.TO
    -3.99% -0.20 pts from XEQT

    Emerging markets are the session's most dramatic story despite comprising just 5% of the fund. The sleeve is down 3.99%, contributing 0.20 percentage points, as South Korean equities fall 9.62% and Taiwanese equities drop 4.84% among the markets tracked here. Bloomberg reporting links the broad EM selloff to concern that the U.S.-Iran ceasefire is nearing collapse, compounding existing pressure on the region's technology-heavy benchmarks.

    Emerging Markets market region icon

Colored bars represent biggest contributors to XEQT's move this afternoon (threshold = ±0.1 percentage points). Returns are daily ETF price moves for tracked regional or sector categories and may differ slightly from raw index movements.

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The Hold Line

Despite the breadth of today's decline, XEQT's year-to-date return stands at 7.22% and the fund sits only 1.0% below its 52-week high. The sharp drop in South Korean and Taiwanese equities is the kind of acute, concentrated move that a small emerging-markets sleeve is sized to absorb rather than amplify. A session like this one illustrates how portfolio weight does the work that willpower often cannot: the EM sleeve's 3.99% loss translates to just 0.20 percentage points at the fund level.

Signals

  • 01

    U.S. tech vs. health care rotation

    U.S. technology is down 3.71% among tracked sectors while health care is up 2.38%, a swing of more than six percentage points between the two largest sector exposures in the sleeve, consistent with markets repricing rate-sensitive growth assets after a hotter-than-expected inflation print. For XEQT holders, this intra-sleeve rotation is worth watching: it shows the U.S. sleeve's outcome depends heavily on which sectors absorb the inflation signal, and the net sleeve return of minus 0.69% reflects that contest in progress.

  • 02

    South Korea's outsized single-day drop

    South Korean equities are down 9.62% among the markets tracked within the emerging-markets sleeve, a move that alone accounts for roughly 1.92 percentage points of within-sleeve pressure and explains most of the sleeve's 3.99% decline. Because the EM sleeve is only 5.04% of XEQT, even a loss of this magnitude translates to about 0.20 percentage points at the fund level, demonstrating how weight constraints bound the impact of sharp single-country moves.

  • 03

    WTI crude above $101 splits Canada

    WTI crude oil, which tracks the price of North American benchmark oil and directly affects the revenues of energy producers, is up 3.84% and crossing $101 per barrel. Canadian energy is responding with a 1.76% gain among tracked sectors, nearly offsetting the drag from materials and technology and keeping the Canadian sleeve's overall loss to just 0.35%. The divergence between energy and the rest of the Canadian market is one of the cleaner sector splits visible in today's data.

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