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

MARKET OUTLOOK

The OECD has shaved 40 basis points from its global economic growth forecasts for 2019 to 2.9 per cent and 3 per cent for 2020. Rising U.S.-China trade tensions and uncertain economic policy is the reason behind the trimming.

Mark Deriet, technical analyst and strategist at Cormark Securities, said last week U.S. labour market strength should prop up the U.S. 2-year yield and that U.S. leading economic indicators are still rising, which means there’s no sign of a recession yet.

Jonathan Golub of Credit-Suisse highlighted last week the high correlation between U.S. 10-year bond yields and the ISM Manufacturing Index. He also showed in a chart that when the ISM is below 50 (49.5 in August) and rising, the S&P 500 typically rises 17.5 per cent in the coming year.

We expect equity markets to continue to rise over the next year.

TOP PICKS

CARGOJET (CJT:CT)

Cargojet provides overnight air cargo between 14 Canadian cities. It recently signed an agreement allowing Amazon to invest in the company at fixed prices based on the volume of Amazon’s future business with Cargojet.

RESTAURANT BRANDS INTERNATIONAL (QSR:CT)

Restaurant Brands operates the third-largest global quick service restaurant chain. Brands include Burger King, Tim Hortons, and Popeyes Louisiana Kitchen.

WSP GLOBAL (WSP:CT)

WSP provides engineering and consulting services to the transportation, infrastructure, property and buildings, environmental and energy sectors.

PAST PICKS: OCT. 11, 2018

AECON GROUP (ARE:CT)

• Then: $16.17
• Now: $18.21
• Return: 13%
• Total return: 16%

CP RAIL (CP:CT)

• Then: $264.97
• Now: $295.35
• Return: 11%
• Total return: 13%

XEBEC ADSORPTION (XBC:CV)

• Then: $0.80
• Now: $1.64
• Return: 105%
• Total return: 105%

Total return average: 45%