Canada one of worst places to invest in 2012: report
OTTAWA — The Canadian stock market has been one of the worst places to invest in 2012 and, despite improving valuations, that weakness could linger on, warns a research report Tuesday from National Bank Financial.
The report blames weakness in the resource sectors and companies' recent inability to meet earnings expectations for the underperformance of Canada's S&P/TSX composite index.
The S&P/TSX 60 index, comprising the 60 highest-capitalization stocks on the broader index, ranked 21st on the list of developed country indexes with its 0.7 per cent year-to-date return. Only Spain's Ibex 35 and Portugal's PSI-20 indexes delivered worse returns.
And when ranked among commodity-producing countries, Canada was the worst performer of all, eighth on a scale of eight.
The heavily weighted energy and materials components of the TSX composite index exerted a considerable drag on the overall index performance, as resource issues have suffered against a background of weak global growth.
Of 10 TSX sub-indexes, energy stocks came in ninth with a loss of 5.42 per cent year-to-date and materials in tenth spot, off 5.58 per cent, the report notes.
But despite softer stock values, "current price weakness may persist until markets experience come catalyst to turn the current trend around," said Marco Letieri of National Bank's economy and strategy group.
"Potential triggers include a significant push of stimulus from Chinese policy-makers and an economic environment leading to a weakening greenback."
Canada one of worst places to invest in 2012: report
OTTAWA — The Canadian stock market has been one of the worst places to invest in 2012 and, despite improving valuations, that weakness could linger on, warns a research report Tuesday from National Bank Financial.
The report blames weakness in the resource sectors and companies' recent inability to meet earnings expectations for the underperformance of Canada's S&P/TSX composite index.
The S&P/TSX 60 index, comprising the 60 highest-capitalization stocks on the broader index, ranked 21st on the list of developed country indexes with its 0.7 per cent year-to-date return. Only Spain's Ibex 35 and Portugal's PSI-20 indexes delivered worse returns.
And when ranked among commodity-producing countries, Canada was the worst performer of all, eighth on a scale of eight.
The heavily weighted energy and materials components of the TSX composite index exerted a considerable drag on the overall index performance, as resource issues have suffered against a background of weak global growth.
Of 10 TSX sub-indexes, energy stocks came in ninth with a loss of 5.42 per cent year-to-date and materials in tenth spot, off 5.58 per cent, the report notes.
But despite softer stock values, "current price weakness may persist until markets experience come catalyst to turn the current trend around," said Marco Letieri of National Bank's economy and strategy group.
"Potential triggers include a significant push of stimulus from Chinese policy-makers and an economic environment leading to a weakening greenback."
Canada one of worst places to invest in 2012: report
