Scotiabank strategist Jean-Michel Gauthier provided some valuable insight while updating the firm’s quantitatively driven top 30 stock list,
“The quant junk rally petered out in February, giving the edge to Quality. Still, deteriorating prospects for Energy (heavy in Growth/Momentum lists) hurt those styles. Momentum has been lagging since October due to several reversals. Slower Pace of Macro Deterioration Makes Fundamentals Relevant Again as “Growth” Advantage Shifting Away from Resources Towards Cyclicals Ex-Tech. Lower volatility in macro data leads our SQoRE model to put less emphasis on high frequency/high volatility Momentum metrics. Cyclicals ex-Tech have taken EPS revisions leadership away from Energy.”
BRP Inc. replaced Empire Co. Ltd. this month. The other stocks on the list are Enerplus, Advantage Energy, Tourmaline Oil, MEG Energy, Birchcliff Energy, Crescent Point Energy, Whitecap Resources, Stelco Holdings, Teck Resources, Torex Gold Resources, IAMGOLD, Stella-Jones, Winpak, Mullen Group, TFI, Russell Metals, Exchange Income, Finning, Boyd Group Services, Uni-Select, Dollarama, Alimentation Couche-Tard, Loblaw Co., George Weston, Element Fleet Management, Fairfax Financial, Intact Financial, Celestica and Capital Power.