Robert McWhirter, president of Selective Asset Management
Focus: Canadian dividend and small-cap stocks

MARKET OUTLOOK

Technical analyst Leon Tuey identified the start of the current North American equity bull market many years ago. He continues to believe that there is much more upside left. He noted on Dec. 5 noted that in May, gold broke out of a six-year base and that it appears headed significantly higher. U.S. WTI oil has traded above US$60 and from a technical analysis perspective looks to be headed 55 per cent higher to US$93. The price of lumber bottomed in May 2019 and also appears to be headed higher. The forecast rise in all of these commodities would be very positive for the TSX in 2020.

Mark Deriet, quantitative and technical analyst at Cormark Securities, recently recommended continuing selling defense stocks in favour of cyclicals. His breadth measures bottomed in December 2018 and the last time it happened before that on February 2016, cyclicals outperformed defensives by 33 per cent. We expect this rotation will benefit the relative performance of TSX stocks In the coming year. After a potential intermediate correction in the first quarter, we expect North American equities will continue to move higher over the coming year.

TOP PICKS

COLLIERS INTERNATIONAL (CIGI:CT)

LABRADOR IRON ORE (LIF:CT)

QUESTOR TECHNOLOGY (QST:CT)

PAST PICKS: DEC. 28, 2018

KIRKLAND LAKE GOLD (KL:CT)

• Then: $34.45
• Now: $57.09
• Return: 66%
• Total return: 66%

ROGERS COMMUNICATIONS (RCI/B :CT)

• Then: $69.95
• Now: $64.75
• Return: -7%
• Total return: -5%

QUEBECOR (QBR/B:CT)

• Then: $28.59
• Now: $33.18
• Return: 16%
• Total return: 17%

Total return average: 26%

WEBSITE: selectiveasset.com