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Brian Wagner

Investment Advisor

Tel: 403-260-9365
Fax: 403-260-9347
Toll Free: 800-465-9404

Brian Wagner

Address
888 - 3rd Street SW
Suite 4100
Calgary, AB
T2P 5C5
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Commentary

January 16, 2012

Stephane Rochon, BMO Nesbitt Burns Investment Strategist, sees better prospects for North American equities in 2012, with high quality, large-cap stocks offering double digit return potential. However, he believes that substantial risks remain on the horizon – a potential global growth slowdown, the European debt crisis and the U.S. deficit in particular. Still, he believes economic momentum will remain the dominant driver of stock returns and the news is increasingly positive from this perspective. At this time there remains a disconnect between stock market performance and improving economic momentum because of the European debt crisis. He believes that North American stock markets are currently priced 15 to 20 % below fair value.

On the other hand, our Fixed Income Strategist, Richard Belley, believes that Canadian and U.S. Government bonds are fundamentally overvalued currently. He recommends a laddered portfolio with a maximum maturity of 10 years including a mix of government, Canadian municipalities and a selection of high-quality corporate bonds, where he sees pockets of better value.