Daily roundup of research and analysis from The Globe and Mail’s market strategist Scott Barlow
Top 30 changes
Scotiabank strategist Jean-Michel Gauthier’s quantitatively driven top 30 Canadian stock list saw 14 changes amid a rout in momentum stocks,
“July saw a large-scale Momentum crash in both the U.S. and World ex-U.S.. Rising Momentum factor volatility in the U.S. last month had already triggered short-term reversal indicators on select Tech names. This holds for August. Momentum Factor Typically Continues Underperforming After Extreme Swings. Still, the worst is likely over. Several US Tech Names Remain at Risk of Momentum Exhaustion in August… (Sell hardware /Semiconductors) … But Software is the Best Tech Subsector to Bet On for an August Rebound (several Canadian names that suffered from AI Disruption concerns as well) Value’s Strong Gains in July Argue for Steady GARP (US) and QARP (Canada) Leadership. Revisiting our recommended lists ... SQoRE [a name derived from Scotia and quant] Canada Top 30: We see a PXT for OVV swap in Energy. Elsewhere, BMO, POW, BBD/B, PMZ-U, MTL, and BHC replace SAP, WDO, VNP, ARE, AAUC, and OGC. Gold miners are almost wiped out, while Energy, Banks, and Industrials solidify their dominance”
The top 30 list now is CES Energy Solutions, Enerflex, Tamarack Valley Energy, Ovintiv , Athabasca Oil, Cenovus Energy, Peyto Exploration & Development, Baytex Energy, Methanex, Discovery Mining, SSR Mining, Centerra Gold, Bombardier, Russel Metals, Bird Construction, Mullen Group, NFI Group, Exchange, Linamar, Magna, Aritzia, Bausch Health Cos, Curaleaf Holdings, Bank Of Nova Scotia, TD Bank, Bank of Montreal, CIBC, Power, Atco and Primaris REIT.
New highs
BMO chief economist Doug Porter put recent market volatility in context,
“Both the S&P 500 and TSX hit record highs on Tuesday, after a tech-led wobble in the past two months. Just as they had weighed on sentiment through the early summer, the IT sector has also keyed the comeback. For instance, the Nasdaq 100 corrected by more than 11 per cent from early June to late July, but has promptly ricocheted more than 9 per cent in less than a week. Meantime, the TSX, which had not really stumbled in recent weeks, renewed its ascent and is up more than 30 per cent year-over-year. A very different sector than tech was the leader here, as mining shares jumped alongside firmer precious metals prices. The new record highs on both major markets puts an exclamation point on the near-four-year rally from the 2022 lows. Casting even further back to pre-Covid days, the S&P 500 is now up 172 per cent from the summer of 2019 (7 years ago), or 15-per-cent annual gains. Even after adjusting for the higher-than-normal inflation of that period, that’s still 11 per cent per year, even before dividends. For the TSX, it’s been 12 per cent and 8.7 per cent since then”.
Copper bull
RBC Capital Markets analyst Sam Crittenden remains bullish on copper,
“Our view: Last week, spot copper held relatively steady while copper equities gained 1.5 per cent, with the market grinding higher on a few tightening physical signals before spiking to start this week. LME nearby contracts flipped into backwardation, signalling near-term scarcity, for the first time this year, while LME inventories fell by more than 20,000 tonnes to 249,850 tonnes and China’s import premiums briefly hit their highest levels since 2022 and remain elevated. On the tariff front, approximately 44,000 metric tons of copper arrived at Comex in July alone as traders continued positioning ahead of a potential US copper tariff decision (where there still hasn’t been any news). The Chile storm continued as Antofagasta halted mining and processing at Los Pelambres for several days, Barrick evacuated workers from its Barriales camp by helicopter, and Codelco temporarily halted operations at several mines including El Teniente. Bernardo Fontaine (new Codelco chairman) said there is ‘no possibility’ of reaching the longstanding target of 1.7 million tonnes within five years, abandoning the volume-first mandate and warning of another difficult year ahead. We remain constructive on the copper market given the physical and longer-dated tightening, the supply disappointments, and the uncertainty around tariffs … Both Hudbay and Capstone are trading at a discount to their peers on current average EV/ EBITDA, while key growth assets including Santo Domingo for CS and Copper World for HBM are likely being risked by the market due to the execution risk. Though we note Hudbay is close to its 3-year max on an in-line print last week. Meanwhile, all the other names are currently trading below their 3 year maxes. Given the current discounts, we could see HBM and CS re-rate higher relative to peers on upcoming catalysts and production growth” .
Bluesky post of the day
Record daily call volumes in $SPY yesterday This is how you get spot up vol up!
— Luke Kawa (@ljkawa.bsky.social) August 5, 2026 at 5:34 AM
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Diversion
“SpaceX rocket stage believed to have slammed into Moon” - Yahoo!