Weak loonie? These TSX stocks could gain strength, says RBC
Written by Emily J. Thompson, Senior Investment Analyst
Updated: May 03 2024
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Source: Yahoo Finance
- Canadian Dollar Performance: The loonie experienced its largest monthly decline against the U.S. dollar since October, potentially drifting further apart due to policy rate gaps between Canada and the Federal Reserve.
- RBC Capital Markets Report: RBC issued a list of Canadian stocks that could benefit from a strong greenback and weak loonie, as well as those that might be negatively impacted.
- Economic Growth in Canada: Canada's economy grew by 0.2% in April, below expectations, increasing pressure on the Bank of Canada to consider easing borrowing costs.
- Banking Policies: The Bank of Canada is expected to cut rates before the Federal Reserve and possibly at a more aggressive pace afterward, reflecting the underperformance of the Canadian economy relative to the U.S.
- Stock Sectors Affected: Canadian stocks in technology, media, financial, healthcare, industrial, and forest products sectors are likely to benefit from a stronger USD versus CAD, while oil and gas producers could benefit from selling commodities benchmarked in U.S. dollars.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
