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Stocks rallied and then stumbled a bit in May as investors shifted between buying into the exceptionally strong first quarter earnings reports and then selling on worries about rising inflation rates and the risk that the current economic recovery will lose speed after the re-opening is complete and stimulus support starts to run out. In Canada, the continued recovery in cyclical sectors such as banks, energy, industrials and basic materials powered the SP/TSX Index to a monthly gain of over 3%. U.S. gains were more muted, though, with the S&P500 gaining 0.6%, its fourth straight monthly gain, but the technology-heavy Nasdaq suffering a 1.5% decline, its first negative month in seven. The small-cap Russell 2000 index, which is more leveraged to the economic reopening, eked out a slight gain in May, posting its eighth straight positive month for the first time since 1995. (more…)