Greg Newman, senior wealth adviser, director and portfolio manager at Newman Group, Scotia Wealth Management

Focus: Canadian dividend stocks and protection strategies
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MARKET OUTLOOK
Higher valuations, record highs in the U.S., seriously overbought technical indicators, nearing Federal Reserve balance sheet normalization and a derailing Trump agenda have many skilled investors calling for caution. But I believe improving economic data in all key regions, improving top-line and bottom-line earnings, still-accommodative interest rates, the promise of eventual tax reform/infrastructure spending/capital appreciation and a moderating U.S. dollar should keep the bulls running for a while yet. Stay long while this plays out. Stocks are not cheap, but they are still far more attractive than bonds and many other assets.

TOP PICKS

ISHARES MSCI EUROPE IMI INDEX ETF (XEH.TO) is an efficient way for investors to play the economic recovery taking hold in Europe after several years of stagnation. Benefit from this growth while earning a current 3.4 per cent dividend yield.

WSP GLOBAL (WSP.TO) is a leading global professional services firm levered to global infrastructure and construction spending. Earn a well-covered three per cent dividend while they continue to grow their earnings at a healthy clip.

AGRIUM (AGU.TO) is the largest retail supplier of agricultural products and services in North America. Benefit from the value accretion associated with a potential Potash merger or as a standalone entity as nitrogen prices reach a floor and they pursue strategies to surface value. Earn a 3.5 per cent dividend while this plays out.
 

PAST PICKS: JULY 28, 2016

MAGNA INTERNATIONAL (MG.TO)

• Then: $49.79
• Now: $59.38
• Return: 19.26%
• TR: 22.25%

ROYAL BANK OF CANADA (RY.TO)

• Then: $79.77
• Now: $92.77
• Return: 16.29%
• TR: 20.69%

ENBRIDGE INCOME FUND (ENF.TO)

• Then: $31.90
• Now: $31.70
• Return: -0.62%
• TR: 5.42%

TOTAL RETURN AVERAGE: 16.12%