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The most telling thing about the pummelling that the stock market has taken recently, and especially this week, is that there’s no simple single cause to point to.

That reflects the fundamental economic risk for 2019 and beyond. There isn’t a lone caution on the horizon that can be identified and monitored and that policy-makers can respond to.

Rather, markets reflect a widening sense of unease that several different types of risks are rising at once — and that although any one of them might be manageable, together they could lead the economy into serious trouble in 2019 or 2020.

This emerging conventional wisdom is far ahead of the facts on the ground: Most economic data lately have pointed to continued healthy growth.

And while stocks are down 9.5 per cent since early October, the yield on longer-term Treasury bonds is at about the same level. The bond market tends to be more closely tethered to the direction of the overall economy than stocks, so that suggests investors in recent weeks have not radically reshaped their view on future growth.

But when you tick through the list of fears causing the sell-off, it’s easy to see why stock investors in particular are getting jittery, driving steep market declines earlier this week.

Read the rest of the article here.

-- Neil Irwin, The New York Times News Service

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Stocks to ponder

Superior Plus Corp. (SPB-T). The stock has been trading in a relatively narrow range between $10.50 and $13.50 for the past two years, but the company’s high dividend yield – currently 6.9 per cent – should be taken in to account whenever looking at the low price volatility. RSI buy signals have had a mixed record in uncovering profitable entry points for Superior Plus. The stock was frequently oversold by RSI during the May to July 2017 period before finally rallying 19 per cent from early August 2017 to October 27, 2017. A November 2017 buy signal was ineffective as the price continued lower until another buy signal in February of this year. After that, the price climbed another 19 per cent to mid-May. More recently, a buy signal near the end of October was also ineffective. RSI buy signals have not provided enough reliable entry points for Superior Plus in the past two years to trust the current one. This is also a case where fundamental research is even more important than usual – any investor considering buying Superior Plus for the dividend and riding out the current downdraft needs to be absolutely certain that the income payments stay at current levels. Scott Barlow explains in this week’s most overbought and oversold stocks on the TSX. (For subscribers).

Tervita Corp. (TEV-T). This stock that appears on the positive breakouts list. In recent weeks, the share price has been rallying while the S&P/TSX Composite Index has been faltering. The share price has increased 38 per cent in the past two weeks. The stock has seven unanimous buy recommendations with a 33-per-cent gain expected over the next 12 months. Alberta-based Tervita is an environmental services provider. After the market closed on Nov. 14, the company reported better-than-expected third quarter financial results that sent the share price soaring 8 per cent the next trading day. Jennifer Dowty reports (for subscribers).

Savaria Corp. (SIS-T). This stock appeared on the negative breakouts list earlier this week with the share price closing at its lowest level since mid-2017. Earlier this month, the company reported quarterly earnings results that came in well below the Street’s expectations, sending the share price down nearly 19 per cent the following trading day. The stock is now trading at a valuation below its historical average and is technically in oversold territory. The CEO of the company has stepped into the market, buying nearly $1-million worth of shares on the price weakness. The Street is anticipating the share price will rebound over the next year with a 42 per cent gain anticipated. Laval, Que.-based Savaria is a manufacturer and provider of accessibility equipment such as stairlifts, wheelchair lifts, ceiling lifts and elevators. Jennifer Dowty reports (for subscribers).

The Rundown

Betting on themselves: U.S. share buybacks hit record high in 3Q

Corporations’ appetite for buying back their own stock has hit a record high. Stock buybacks by companies in the benchmark S&P 500 index climbed to $194.07-billion in the third quarter, according to data from S&P Dow Jones Indices. The buying spree, which has steadily increased since the second quarter of 2017, has been led by companies in the technology sector. Apple spent more than $80-billion on share buybacks through the first three quarters of this year. Chipmaker Qualcomm also bet big on its own stock, shelling out $21.2-billion in the third quarter. Associated Press reports.

A slippery trade: oil slump proves bears right

The latest collapse in oil prices has proved some investors right in their lack of confidence in energy stocks this year. Crude prices surged to a four-year high early in 2018 as tensions with Iran and OPEC supply cuts raised concerns that global oil supply was dwindling. But the narrative has flipped since October as worries over a global trade war and rising U.S. shale oil production mounted, driving oil to a one-year low on Friday. Brent crude is down to $60 a barrel from a peak of $85 in early October. While oil majors have gone some way to cleaning up their balance sheets since the 2014 oil price collapse, their shares are still sensitive to moves in the underlying commodity - higher crude spells stronger revenues. When prices were climbing earlier this year, big banks were recommending investors buy back into the sector. Many, especially in Europe, followed that advice. But given the latest falls, some of those who sat on the sidelines believe their caution has been rewarded. Reuters reports.

Rob Carrick’s 2018 robo-adviser guide: Find the right firm for you

Rob Carrick takes a close look at all the robo-advisers in Canada and examines what they have to offer and which one might be right for you as an investor.

Others (for subscribers)

Even with a ‘$9-trillion debt bomb,’ markets aren’t as bad as they seem

Friday’s analyst upgrades and downgrades

Friday’s Insider Report: CEO and COO each trade over $3-million worth of this dividend stock

Oil plunges more than 6 per cent despite potential OPEC cut

Still loonie after all these years: Canadian dollar will still be impaired two years from now, CIBC says

Others (for everyone)

5 reasons cryptocurrency prices are plunging again

Ask Globe Investor

Question: I’ve never contributed to my TFSA as I was a small-business owner for 26 years and we owned five homes over those years and paid the the maximum we could afford all the time. What amount can I put into a TFSA now? I’m in my 50s.

Answer: The TFSA was launched in 2009 with an annual contribution limit of $5,000. The limit remained at $5,000 for 2010, 2011 and 2012, rose to $5,500 for 2013 and 2014, jumped to $10,000 for 2015, then fell back to $5,500 for 2016, 2017 and 2018. An individual who was at least 18 when the TFSA was launched but has not deposited a dime into his or her TFSA would therefore have accumulated $57,500 of contribution room.

--John Heinzl

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Compiled by Gillian Livingston

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