Hap Sneddon is portfolio manager and technical analyst at CastleMoore Inc. His focus is on technical analysis.
George Weston Ltd.
The recent quarterly results delivered stable operating earnings in food and a 36-per-cent jump overall to $225-million, or $1.18 per share. The annual dividend was also raised 9 per cent to $1.66. The company is still sitting on a war chest of $1.5-billion from the sale of its U.S. bakery assets in 2009.
iShares MSCI Switzerland Capped ETF
Switzerland is moving up the weekly and monthly country-ranking tables, showing the nation’s businesses provide the right mix of health care and consumer staples. The ETF’s holdings – Nestlé SA at 18.6 per cent; Roche Holding AG, 13.5 per cent; Novartis AG, 13 per cent; and UBS AG, 4.81 per cent – is a well-diversified mix, yet focused on secularly strong industries.
U.S. 10-year Treasuries
Don’t fight the Fed – or the deflationary impulses still at work in global economies. Fixed income is entering its period of seasonal strength and bonds are an under-owned asset class. A yield break below 1.45 per cent would bring in more funds. This trade is suggested for its capital gains potential – the interest payment is a plus.
Past picks: May 14, 2012
Jean Coutu Group (PJC) Inc.
Total return: +17.90 per cent
SPDR Gold Trust
Total return: –5.93 per cent
Total return: +20.85 per cent
Total return average: +10.94 per cent
We are at a juncture where lots of good news has been priced in. Is this the pause that refreshes, or the lull before a equity-market trend change?
Most of the global data has been weakening – not a single European country’s ISM is above 50, and U.S. GDP has been weaker than expected – leading to downward revision of second-quarter numbers.
Yet, a couple of recent data points suggest things are improving – such as the U.S. non-farm payrolls report from last Friday or Wednesday’s positive China export-import figures.
The next month will show whether a true pro-cyclical rally is able to take hold and central bankers will be talking of raising rates to soak up liquidity, or if the material and resource rally is simply a short-term play into late spring.