Daily roundup of research and analysis from The Globe and Mail’s market strategist Scott Barlow
RBC analyst Bish Koziol made a whopping 18 changes to his quantitatively-driven top 40 Canadian stock picks,
“Our Canada Overall Top 40 Portfolio gained 3.6 % in March, versus the 1.5% drop in the S&P/TSX Composite. The resource segment of the portfolio led the gain last month with Materials and Energy advancing 14.5% and 6.3% respectively . We increased the weighting of Energy in our Portfolio to 17.5% with the addition of SU, CNQ, and POU. All but one sell this month realized worsening overall QuaDS [quantitative Dominion Securities] scores”
The stocks were added to the portfolio:
- Cascades Inc.
- Paramount Resources Ltd.
- Canadian Natural Resources Ltd.
- Bank of Montreal
- Magna International Inc.
- Saputo Inc.
- National Bank of Canada
- Suncor Energy Inc.
- Enghouse Systems Ltd.
Companies removed are:
- New Gold Inc.
- Extendicare Inc.
- Mullen Group Ltd.
- Gildan Activewear Inc.
- Agnico Eagle Mines Ltd.
- Torex Gold Resources Inc.
- Alamos Gold Inc.
- Intact Financial Corp.
The full list of picks is now: Pason Systems Inc. ,Trican Well Service Ltd, Paramount Resources Ltd., Canadian Natural Resources., Suncor Energy Inc., Imperial Oil Ltd., Keyera Co., Stella Jones Inc., Cascades Inc., Silvercorp Metals Inc., Dundee Precious Metals Inc., Eldorado Gold Corp., CCL Industries Inc., Hudbay Minerals Inc., OceanaGold Corp, Kinross Gold Corporation, Exchange Income Corporation, Finning International Inc., Toromont Industries Ltd., Linamar Corporation, Magna International Inc., Saputo Inc., Metro Inc., Loblaw Com Ltd., AGF Management Limited, CIBC, Canaccord Genuity Group Inc., iA Financial Corporation Inc., Bank of Nove Scotia, Fairfax Financial Holdings Ltd., Great-West Lifeco Inc., Bank of Montreal., National Bank of Canada, Open Text Corp., Enghouse Systems Limited, Celestica Inc., Rogers Communications Inc., Cogeco Communications Inc., Quebecor Inc., TMX Group Ltd.
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BMO senior economist Robert Kavcic writes that it’s “still winter” in Canadian housing,
“Much of the weakness is concentrated in Southern Ontario and parts of B.C., whereas many other regions of Canada (Alberta, Quebec and Atlantic Canada) look significantly firmer. The plunge in consumer confidence in March, to the lowest level in at least 65 years, is not conducive to strengthening home sales activity. Indeed, sales had the weakest March since the pit of the 2009 recession, down 9.3% from already-low year-ago levels. Contrary to recent years, market psychology has shifted to the point where the urgency is gone and, in some areas, the weakness itself is probably prompting further caution (the whole falling knife thing). According to Nanos/Bloomberg, just 33% of Canadians expect higher home prices over the next six months, while nearly 18% expect prices to fall. The net +15 ppt balance is down from +42 ppts a year ago as the Bank of Canada’s easing cycle was starting; and around +60 ppts during the height of the market in early 2022. Even though the Bank has cut rates by a hefty 225 bps, the easing has long been priced into the bond market and reflected in lower 3- and 5-year fixed mortgage rates. With the lowest available mortgage rate therefore still hovering around 4%, affordability relief has been slow at still-tough levels—a key reason we haven’t been expecting a sharp rebound”
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Morgan Stanley chief executive strategist Michael Wilson details the reasons behind the rangebound S&P 500,
“Competing factors are at work, keeping the S&P 500 in the middle of our 5000-5500 near-term trading range. The recent reciprocal tariff pause and exemptions show that the administration is willing to show some flexibility on tariff policy—a positive as this was unknown 2 weeks ago. However, on the negative side, earnings revisions remain in a downtrend, the Fed remains on hold, back-end rates remain somewhat sticky and uncertainty around trade policy persists despite recent developments. Upside risks that could potentially drive a break above 5500 in our view include a more dovish Fed, a broader trade deal with China, back-end rates below ~4.0% (without recessionary data) or an upward inflection in earnings revisions. Downside risks that we believe could lead to a possible break below 5000 are a further drop in business confidence that causes an unemployment cycle, back-end rates above ~5.0%, or a further breakdown in EPS revisions that’s pervasive across industries”
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Bluesky post of the day:
GOLDMAN’s Scott Feiler: “.. I have covered consumer for 18 years now. The feedback I have received from my conversations the last 3 trading days is probably the most bearish I can remember. There is tremendous conviction from consumer investors that the ‘E’ is too high almost across the board ..”
— Carl Quintanilla (@carlquintanilla.bsky.social) April 18, 2025 at 9:55 AM
Diversion: “Scientists find ‘strongest evidence yet’ of life on distant planet” – BBC