Toronto (TSX) Trade Outlook: Sideways to Down

Focus: Strategies

Ziad Jasani Image Ziad Jasani Managing Director and Partner, Independent Investor Institute

The most vulnerable spaces in our TSX market are Gold Producers, Technology, Utilities, REITs, Telecom, Staples, Industrials, asserts Ziad Jasani, Co-founder of The Independent Investor Institute, Toronto, in his weekly Trader video.

Our mid-to-longer-term trading strategy and sector position from a few weeks to three months:

The Toronto Stock Exchange (TSX) is dislocated and expensive on long-term routines with the S&P 500, but has neutralized vs. the world iShares MSCI ACWI Index ETF (ACWI).

This implies under-performance is more likely over the next month vs. the S&P 500 (sideways to down-trending action).

The most vulnerable spaces in our market are Gold Producers, Technology, Utilities, REITs, Telecom, Staples, Industrials:-

iShares S&P/TSX Global Gold Index ETF (XGD),
iShares S&P/TSX Capped Information Technology Index ETF (XIT),
BMO Equal Weight Utilities Index ETF (ZUT),
iShares S&P/TSX Capped REIT Index ETF (XRE),
iShares S&P /TSX Capped Consumer Staples Index ETF (XST),
BMO S&P/TSX Equal Weight Industrials Index ETF (ZIN).

These and Telecom are now all dislocated and expensive on annual routines and underperformance is expected.

Our Energy sector is relatively cheaper on annual routines and suitable for short-term bounce plays but not longer-term investing.

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