The Globe and Mail attempts to identify seasonally strong Canadian
stocks for the fourth quarter in its Tuesday, Sept. 4, edition. The Globe's Craig McGee writes that the S&P/TSX composite index
has been exceeding expectations
this year, up 15.8 per cent so far. All sectors but health care have
generated positive returns. To
end the year, Mr. McGee says the market may still
have room to run.
Looking back, the period from
October through December has
historically been the strongest
quarter of the year -- the median
return for the fourth quarter dating
back to 1956 has been 3.8 per
cent and it has been positive 80
per cent of the time. The sectors
that have made the biggest contributions
include telecommunications,
information technology,
industrials and financials, with
median fourth quarter returns of
7.5 per cent, 7.3 per cent, 7.1 per
cent and 7 per cent, respectively,
since 1988.
To find the top stocks in these sectors Mr. McGee looked for positive 12-month and five-year return on equity, among other metrics. Stocks in seasonably strong sectors are Canadian Imperial Bank of Commerce, Industrial Alliance Insurance and Financial Services, Toromont Industries and Royal Bank of Canada.
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