By Angela Harmantas
Why does this one statistic lead us to believe that Americans are once again confident about the US economy? Today on Before the Bell we analyze recent labour market data and what it could mean for November’s US Federal Reserve meeting. Also, it may be time to go long on Canadian stocks, and a new expert tells us why this mining company is one of the most profitable she’s seen – here’s what you need to know today:
It’s difficult to quantify the general sentiment about a country’s economic health. We can point to indexes and currency fluctuations but when it comes to our feelings about the state of the economy, there’s no great indicator that tells us what the average person is sensing. Expect this one: the number of people quitting their jobs. Naturally when the economy is doing poorly people hang onto their existing jobs because they don’t know if they can find a new one. And you know what’s risen to its highest level in six years in the United States? That’s right, the number of people quitting their jobs. It’s a significant indicator that the Feds certainly take notice of when deciding whether to raise interest rates. Janet Yellen pointed out in September that one of the main reasons behind the Fed’s decision not to raise interest rates was due to weakness in the labour markets. I’ll pose the question to you: would you feel comfortable quitting your job in this economy?
Is it time to go long on Canadian stocks? Some analysts are starting to think so. While this may seem premature after one of the worst quarters the TSX has seen in recent memory, two experts quoted in yesterday’s Financial Post believe that Canada’s economic fortunes are turning, as we put the damage caused by the low loonie and decimated oil prices behind us. There were two positive bits of information this week: first, the country’s GDP figures beat expectations, and second, the World Economic Forum ranked the strength of Canadian banks as the highest in the world. So what could lead the turnaround in Canada? According to Brian Belski, chief investment strategist at BMO Capital Markets, real estate trusts may help to boost Canadian stocks, while Greg Taylor, vice-president and portfolio manager of equities at Aurion Capital believes it’ll be financial stocks. Let us know what you think of both sectors, and whether you agree if Canadian stocks are poised for a turnaround.
Finally, I’m happy to introduce our latest expert on SmallCapPower, Gwen Preston. You may know her as the Resource Maven, which is also the name of the weekly newsletter she distributes containing her thoughts on the mining industry. I’m a subscriber and I love reading her well-informed, witty insights. (I say well informed because she knows how to pick mining stocks as well as any portfolio manager – one of her early 2015 picks gained 60% in two weeks.) She’s telling us today why she thinks one miner is the “most profitable on the planet” and why another company has a Mining Dream Team at its helm. Enjoy the interview and have a great weekend!
Do you have a burning question you’d like answered by an investment expert or analyst? Let me know and I can post the answer here in the blog. Contact me by email at angela@smallcappower.com or on Twitter: @aharmantas.
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