FOCUS: Oil and gas stocks and small-cap Canadian equities
MARKET OUTLOOK:
The Canadian energy market has now entered its normal summer malaise while being generally unattractively valued, given the likelihood of a $65 per barrel ceiling price for the next several years. Patience (and cash) will likely be rewarded with a better entry point later this summer heading into the fall. Sometimes the best way to make money is to not lose it in the first place.
Non-resource small caps are generally fully valued as money continues to migrate/stay out of resource stocks. Boring low growth companies are being punted by private equity funds at extremely high valuations and new non-resource IPOs are 10 times oversubscribed. Both of these examples show how crowded the anti-resource trade has become and why valuations are currently unattractive. (click here)
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