Market highs, CFIB’s stand, & IPO buzz.

About this edition

Illuminating possibilities.

Equity markets surged while commodities cooled under a strengthening U.S dollar. Canadian businesses are speaking up, calling for tax breaks and more. Meanwhile, a four-year Canadian IPO hiatus is finally showing signs of life.

In this edition of the SMB Pulse, we uncover this past week’s news in capital markets, the CFIB taking a stand against government-business misalignment, and a renewed appetite for Canadian IPOs.

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Capital markets and forecast

NA market sets record highs; remain cautious.

North American equity markets have hit record highs, with some pullback from blue-chip tech earnings and Iran tensions. Despite the drop, consensus forecasts remain strong in 2026 with technology and materials leading the charge.

Tech earnings: Big tech earnings this week have highlighted a cautionary outlook for investors: they’re willing to overlook the aggressive spending on AI if it provides results. Even with Microsoft and Meta beating projected earnings, Microsoft shares dropped by 11% from slowing cloud growth and concerns on the return on investment from AI spending. 

Meta, on the other hand, surged amidst visible returns from AI-related spending, linked to higher-margin ad performance. Consensus estimates are strong for 2026: 14% S&P 500 earnings growth led by tech and materials sectors.

Commodities & crypto: Precious metals are an anchor for investors amid heightened geopolitical uncertainty. But with Trump’s recent announcement of Kevin Warsh as the next U.S. Federal Reserve chair, Canadian gold, resource-heavy equities, and Bitcoin plummeted.

Warsh’s nomination is widely seen as a move that will push the U.S. dollar and real yields higher than previously expected — a clear downside for those purchasing U.S. commodities.

Fixed income: Both the Fed and the Bank of Canada (2.25%) held rates steady. Additionally, Canadian yields and market expectations remain stable, aligning with the BoC’s projected Canadian growth of 1.25% over the next few years as the economy adjusts to U.S. tariffs and weakened export numbers.

For the average business, loan rates shouldn’t see any unexpected upticks in the near term. Given the stability, now is an opportune time to review capital plans, debt refinancing, or new credit acquisitions with your finance team, as rates may change throughout the year.

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CFIB critiques federal budget

Government providing little relief for Canadian SMBs.

The Canadian Federation of Independent Business (CFIB), an organization that defends the interests of SMBs and advocates for a better business environment, recently rebutted the lack of small business support from the federal government’s November budget.

The $1B Regional Tariff Response Initiative (RTRI), a federal budget program aimed at providing relief to SMEs suffering from the ongoing trade disputes with the U.S., has been a mixed bag of results. For many, it has provided the necessary capital to SMEs that would have been unable to survive U.S. tariffs; however, businesses must undergo a time-consuming application process to qualify for the program.

CFIB data pointed out that less than 1% of small businesses have applied to the federal RTRI, with 27% of respondents stating the program doesn’t apply to them.

The general sentiment among SMBs is that government programs aren’t hitting the mark. A large share of small businesses feel excluded; they are calling on the government to prioritize removing interprovincial trade barriers, meaningful tax relief, and a more stable trade relationship with our biggest trade partner, the U.S.

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Canada’s IPO market

Is 2026 the year of Canadian IPOs?

Canada’s IPO market, which has been subdued for four years, is set to reopen with expectations of stable, national growth in the near future. 

The news: During this period of weak IPO activity, the Toronto Stock Exchange saw more companies delisting than listing. Companies were choosing private equity or bank debt over listing due to numerous factors, including:

• A High-inflation, high-rate period
• Regulatory hurdles
• Market volatility
• U.S. tariffs and geopolitical uncertainties
• High listing costs

Now that policy rates are stabilizing and equity markets are forecasted to grow, the wait is over for businesses that previously put their IPO on hold. Bankers report active IPO discussions with firms in technology, fintech, natural resources, and consumer products.

This projected surge of IPOs in 2026 is a testament to market sentiment about Canada’s economic outlook, as companies list only when they believe investors will pay reasonable valuations, and investors buy when economic and policy risks are manageable.

Takeaways: For start-ups and scale-ups that have outgrown bank financing or early-stage VC, 2026 may be a suitable year to IPO rather than selling early or listing abroad. Businesses not planning to IPO still benefit from a thriving IPO market, as an active market lifts valuations for private companies in the same industry.