When it comes to economic growth, the loonie and bonds, Canada’s clearly been on a tear. But the upward trend doesn’t extend to the TSX.

Read: Why the TSX took a dive in early trading

Though the exchange gained 1% last week after three weeks of losses, it merely kept pace with U.S. averages, and it’s down almost 1% so far this year, notes BMO’s chief economist Douglas Porter in a weekly economics report.

“That leaves it lagging behind the S&P 500 by a honking 10 percentage points in 2017,” says Porter, adding that sector weightings are largely responsible, with the TSX being long on energy and materials, and short on tech and health care. (See this BMO report for more comparisons between the TSX and the S&P 500.)

The Canadian equity market, as measured by the S&P/TSX Composite Index, was down 1.6% in Q2. In contrast, the S&P 500 was up 0.5%.

Read: Hits and misses in the energy sector

Investment strategy

Given equities’ performance, HSBC Global Asset Management says in a Canadian outlook report that its equity position is neutral relative to developed-market bonds and cash. The bank says it favours rebalancing equities into shorter-term fixed income and cash. The move comes after realizing several years of robust equity returns.

The Canadian consumer sector continues to look strong, something investors should keep in mind when making sector allocations, says Nick Exarhos, director at CIBC World Markets, in a weekly economics report.

He notes that the 12-month trend in job gains is at its highest level in about five years, with the Canadian payrolls report suggesting wage growth in the 2% to 2.5% range. Further, companies expect to increase their hiring rate, according to the Bank of Canada business outlook survey.

He also says the outlook for exports is good, so long as the loonie doesn’t keep soaring. Canadian factories are seeing greater outbound shipments, “perhaps a first sign of the turn in the Canadian industial sector,” he says. That, along with infrastructure dollars into 2018, should be supportive of related TSX sectors, he says.

Read: Late cyclicals and the loonie: what’s next?

HSBC’s longer-term outlook aligns with that view.

“Our decision to continue to harvest gains in equities […] does not in any way undermine our long-term view favouring them,” says the HSBC report. “We remain cautiously optimistic but also feel Canadian equity investors should temper their expectations if they are basing their growth projections on the impressive performance of previous quarters.”

The bank says it will continue to monitor U.S. policies, Brexit, Chinese reforms and a potentially overly aggressive Fed, which would stifle economic growth.

Read the full reports from BMO, HSBC and CIBC.