BMO chief strategist Brian Belski provided detail on recent Canadian market weakness and offered advice to investors (my emphasis) ,
" The S&P/TSX declined 5% on total return basis in April, this first monthly decline of 2022. In fact, only eight of the 57 individual factors we track posted positive returns in April, and this was made up of only momentum and trailing growth factors. Interestingly, forward growth was easily the worst performing category with all six of the individual forward growth factors underperforming. Indeed, the market appears to have lost some confidence in growth expectations as it struggles with slowing earnings momentum. Meanwhile, despite falling confidence in expectations, our trailing growth, valuation and capital usage factors continued to outperform and remain positive year to date. Overall, we continue to believe the transition to more normalized earnings growth environment will likely remain bumpy and favour a more selective approach to investing. As such, we believe investors should remain focused on capital deployment strategies, including dividend growth, cash flow, and even GARP style strategies.”
Mr. Belski helpfully provided a list of domestic stocks with the highest one year increase in dividend yield to make his recommendation actionable. The outperform rated companies on the list are Barrick Gold Corp., ARC Resources Ltd., Artis REIT , Birchcliff Energy Ltd., Cascades Inc., Canadian Natural Resources Ltd., Crescent Point Energy Corp., ECN Capital Corp., goeasy Ltd., H&R REIT, Methanex Corp., Pan American Silver Corp., PrairieSky Royalty Ltd., Quebecor Inc., Sun Life Financial Inc., Suncor Energy Inc., Teck Resources Ltd., and Whitecap Resources Inc.