Sid Mokhtari, chief market technician at CIBC Capital Markets.Supplied
Historically, December is a solid month for equity markets with gains accelerating into the end of the month with a “Santa Claus” rally.
The U.S. Federal Reserve interest rate announcement scheduled to take place on December 10 may provide the next catalyst for the stock market. Fed funds futures are pricing in an 83 per cent chance of a rate cut.
Over the past 30 years, the S&P/TSX Composite Index has delivered an average return of 1.1 per cent, according to a Nov. 30 research report from Sid Mokhtari, CIBC’s chief market technician.
Surprisingly, the sector with the lowest return in December is technology with an average gain of just 0.2 per cent. Meanwhile, he notes that amongst the leading sectors are financials, utilities, consumer staples, consumer discretionary and precious metals with ‘hit rates’ exceeding 60 per cent. A hit rate is a measure of frequency of observations.
Mr. Mokhtari publishes a monthly report with his top 10 stock ideas and his disciplined process has delivered strong returns. He screens and selects stocks from the largest 100 members by market capitalization within the S&P/TSX Composite Index.
His technically driven stock recommendations have consistently outperformed the broader index across a wide range of market conditions. In the first 11 months of 2025, his portfolio of stock selections rallied 49 per cent, compared to a 27 per cent price return for the broader index. His stock selections also outperformed the S&P/TSX Composite Index in 2024, 2023 and 2022 by 5.8 percentage points, 6.3 percentage points and 2.7 percentage points, respectively.
For December, his diversified basket of stock selections includes nine new stocks and one carryover from the prior month.
In the materials sector, he added three stocks to his basket of top picks that all have spectacular year-to-date gains – Americas Gold and Silver Corp. (USA-T), Equinox Gold Corp. (EQX-T) and Orla Mining Ltd. (OLA-T).
Americas Gold and Silver along with Equinox Gold are both in the leading quad and have year-to-date gains of 345 per cent and 170 per cent, respectively. Orla Mining is in the improving quad and is up 146 per cent so far this year.
In the financial sector, he has IA Financial Corp. Inc. (IAG-T) along with the sole carryover, Manulife Financial Corp. (MFC-T). IA Financial is in the consolidating quadrant and Manulife is in the improving quad.
CIBC’s fundamental research analyst has an “outperformer’ recommendation on IA Financial and target price that implies a potential return of 6 per cent. Manulife has a ”neutral" rating and a 1 per cent potential return, according to Mr. Mokhtari.
He has two industrial stocks in his basket of top picks, Aecon Group Inc. (ARE-T) and Exchange Income Corp. (EIF-T), which are both in the leading quad. CIBC’s fundamental research team has a “neutral’ recommendation on Aecon with a 28-per-cent potential return and an ”outperformer" rating on Exchange Income with a potential return of 17 per cent.
He added two stocks from the energy sector to his stock selections, Suncor Energy Inc. (SU-T), which is in the improving quad, and Whitecap Resources Inc. (WCP-T), which is in the leading quad. Both stocks have “outperformer” ratings from the fundamental research team with an 11-per-cent potential return anticipated for Suncor and 15-per-cent potential gain forecast for Whitecap Resources.
Lastly, he has one technology stock in his basket of top picks – Celestica Inc. (CLS-T). This stock is in the leading quad with a 262 per cent year-to-date price return. It is the fourth-best performing stock in the S&P/TSX Composite Index in 2025. The fundamental analyst has an “outperformer” rating on Celestica with a forecast potential return of 16 per cent.
In the days ahead, Globe Investor will feature an in-depth Q&A featuring Mr. Mokhtari insights on equity markets, stocks, commodities and ETFs.