“After a decade of being right owning those companies, 2022 delivered a gut punch,” he says. “But there is a reason those companies did so well. Growth always gets rewarded over time – and now you can buy growth on sale.”According to Kim Shannon, founder and co-chief investment officer at Siona Investment Managers Inc. in Toronto, “Canadian stocks are the cheapest they’ve been versus the U.S. in more than 40 years.
She adds the current defensive pricing of Canadian stocks offers superior expected returns compared with U.S. or global equities. As well, in the five periods since the 1930s when inflation has been at more than 4 per cent, Canada outperforms the U.S. by 8 per cent on average.Colin Cieszynski, chief market strategist at SIA Wealth Management Inc. in Toronto, says monetary tightening and reduced liquidity were primarily responsible for driving the 2022 bear market in stocks and bonds.
“We have been exposed to the energy transition for several years, but the setup for 2023 is particularly attractive,” he says. The second event Mr. Lauzon highlights is the U.S. Inflation Reduction Act. He notes the US$750-billion package includes major investments for combatting climate change.