Looking for investing ideas? Here’s your weekly digest of the Globe’s latest insights and analysis from the pros, stock tips, portfolio strategies plus what investors need to know for the week ahead.
Why Canadian bank investors should shudder with each rate increase
The Bank of Canada announcement on Wednesday of a rate hike, and the growing probability of more before year-end, suggest that the future will be very different than the past for Canadian banking stocks, Ian McGugan writes. The Big Six and other lenders have thrived over the past quarter-century as households have more or less doubled their debt levels in relation to their disposable incomes. But if we’re entering a period in which loan growth will be slower, and default rates will rise, bank stocks look distinctly less shiny.
A rising rate guide to mortgages, HELOCs, GICs, savings and more
The era of fantastically low interest rates ended Wednesday, Rob Carrick writes. Rates are still low, but they’re no longer a gift to borrowers and a saver’s nightmare. Adjust your finances to this new reality by taking these five steps.
Read more: Variable vs. fixed: A direct comparison of both for today’s rising mortgage rate environment
Hydro One shares hit as several analysts downgrade ratings in wake of board, CEO exit
Bay Street analysts downgraded their views for Hydro One and investors drove down the utility’s share price in response to the Ontario government’s extraordinary move to push out the board and CEO Mayo Schmidt. The leadership shakeup at Hydro One fulfills one of Mr. Ford’s campaign promises, David Berman writes, but the market reacted badly. While analysts remain largely upbeat about the long-term prospects of Hydro One, they have raised concerns about political uncertainty and further government moves that could cut the company’s profitability. Four have downgraded the stock.
Related: The Globe’s investing stars and dogs of the week
Read more: Renewable energy stocks slide as Ontario vows to scrap clean-power projects
Top stock picks from seasoned investors for these dangerous market times
A number of observers are warning that the nine-year-old bull market will soon sputter amid higher interest rates, stretched valuations and escalating global trade tensions, David Berman writes. But if hiding in cash seems like an extreme response to an uncertain threat, what are the best Canadian stocks for awaiting a downturn that, well, might take a while? The best bet, according to the seasoned investors we contacted, is to look at high-yielding stocks that are out of favour and whose underlying businesses will continue to thrive during an economic downturn. The best part: Most of these stocks are cheap.
Read more: John Heinzl’s model dividend growth portfolio as of June 30
How investing in real estate can easily go sideways
For many individuals, investing in real estate – whether commercial or residential – seems like a sure bet, particularly after years of double-digit price increases in hot markets such as Toronto and Vancouver. But sinking money into property can also be a disaster for those lacking experience and expertise. Novice investors can be overwhelmed by market fluctuations, maintenance costs and even tax considerations that can turn can’t-miss investments into money-losing albatrosses. Here are five potential pitfalls facing people who invest in real estate.
Related: How to get the best advice if you’re thinking of buying a rental property
Read more: Real estate on the brain: Why buying a home can be so painful
Look for investment advisers who earn their fees, not cut their fees
The problem with seeking the lowest-cost investment advice is that you may end up with the lowest-quality advice as well, Rob Carrick writes. Savvy investors generally work on the principle that paying less is unquestionably a good thing. But advice may be an area where pursuing the cheapest possible fee produces a worse outcome for your finances.
What investors need to know for the week ahead
The spotlight is on corporate earnings this week as companies reporting their latest results include: Bank of America, Johnson & Johnson, Netflix, Microsoft, Rogers Communications, Encana, Canadian Pacific Railway, West Fraser Timber, BlackRock, Alcoa, American Express, Morgan Stanley, CSX, Goldman Sachs, Charles Schwab, Choice Properties REIT, General Electric and Honeywell. Economic data on tap include Canada’s existing home sales and MLS home price index for June on Monday and inflation figures on Friday. On Wednesday, the Federal Reserve will be releasing its Beige Book minutes, taking the temperature of the U.S. economic climate. The G20 finance ministers and central bank governors meet in Buenos Aires on Saturday and Sunday.
Looking for more investing ideas and opinions?
Rosenberg: Why I’m becoming much more defensive in my investment calls
These five Canadian dividend stocks offer a less-risky play on renewable energy
Short sales on the TSX: What bearish investors are betting against
Dialing for dividends in the beaten-down telecom sector
Investors, got a case of the trade jitters? Here’s how to put the risks in perspective
How Brexit could be a buying opportunity for Canadian investors
Fifteen Canadian stocks with lower sensitivity to market swings
Buffett starts to say goodbye to a pile of equity-index options
A stock with a 3% yield, 30% upside forecast and 16 buy calls