Market Call:

Top Picks from Brendan Caldwell, president and CEO, Caldwell Investment Management

FOCUS: Canadian Value Stocks

Market outlook:

The Canadian market is at a crossroads. Our resource base has depended so heavily on expansion in Asia that now that growth in that region is slowing and commodity prices have weakened. Going in the other direction is the United States. It has taken over half-a-decade for our neighbours to the south to shed the economic and social debris created by the 2008 financial crisis, but the U.S. is now reemerging as the economic growth engine for the world. As for Europe, it is nowhere at present and will remain there for some time. As America continues to pick up steam, demand for commodities will increase, taking up much of the slack left slowing Asian growth.

The Canadian Value Momentum Fund has performed by focusing on non-commodity Canadian industries, examples of which are our past and present top picks. The moves by the Bank of Canada to cut rates have had the inevitable effect of weakening the Canadian dollar. This should be somewhat helpful to Canadian industrial companies, but do not expect a resurgence in new auto plants soon. At least the movie business in Toronto and Vancouver should get a boost. Look for Tom Cruise at a Starbucks near you.

Top Picks

IMAX (IMAX.N)
JP Morgan (JPM.N)
Cineplex (CGX.TO)