Mid January 2025 and Cautious Markets Ahead

 

With all the focus on the US and tariffs currently, Canada has it's own issues to work out as the government sort of sits in limbo until Parliament resumes in March after the ruling party, the Liberals vote on their new leader and Prime Minister. It looks like a Federal election could be coming later in 2025.

That's all rolling the stock markets plus inflation and interest rates could react to tariffs which Trump wants to add to Canada's exports looking for better trade deals to favour the US.

Meanwhile, in Canada and with the banks, TD continues to be one of the most active stocks these days as it's price is above $80 CAD currently rallying about $10 from a recent low. With energy, CNQ, Canadian Natural Resources is on that most active list off and on in the energy sector. Two of my most watched sectors as I accumulate shares in companies in both sectors moving forward.

It's been interesting reads from different Bloggers since the New Year rang in and how 2024 moved their portfolios. Different approaches, patience and sticking to their plans. I prefer large cap stocks such as in the top twenty by yield in the TSX 60 and others with low volatility. There's no management fees holding individual stocks and lately, I've been looking over some higher yield ETFs which have no management fees these days but always wise to dig into the fine print and prospectus, etc.

I'll use these added distributions from ETFs to buy more stocks, such as ENB, Enbridge and Fortis, FTS in February before the ex-dividend dates along with other stocks in that busy month for stocks in my portfolio.

Personally, I like the challenge of getting my portfolio up over 6% for a yearly gain, which is not difficult some years when the Markets are favourable. When Markets are down, I look forward to the dividend increases from my stocks plus gains which adds to my total return.  

I recently read the latest post from the Millennial Revolution Blog about their 2024 portfolio where they are into index tracking ETFs with 25% each in the US stocks, TSX, international and preferred shares. Re-balancing when needed with impressive numbers. I read their book when it came out called ... Quit Like a Millionaire.

Interesting about the preferred share ETF; ZPR, BMO Laddered Preferred Share Index with a current 5.8% yield in that article and a brief summary of how it works.

I look forward to looking over my stocks and any changes with the corporation and banks heading into the last half of January, 2025 and ahead to February where Utilities and the Insurance/Financial sectors are on my mind.

I'm overweight with the utility/energy stock, EMA in my portfolio but with it's natural gas assets in the US and AI Data Centre builds and expansion going ahead ... that could add up to additional revenue for the company. EMA, Emera Inc. has an ex-dividend date of January 31st, 2025 with a 5.59% current yield.

 

Happy New Year 2025 and the Big Banks

 

2025 will be a year of government and leader change in North America with Trump taking office in the US on January 20th. Possibly in Canada. Justin Trudeau and the Liberal party will face headwinds where a non-confidence vote could be coming in January.

Otherwise, there's always a lot going on besides the US tariff threats that will probably push up inflation and effect interest rates plus the daily economic news which the stock market reacts to. 

Meanwhile, where sectors and stock prices move with the news and social media, I check on corporation financials and statistics I hold when making further buys. Ideal, is a growing dividend going forward which has that compounding effect with a stock that's undervalued. With undervalued stocks, there's that potential for stock price gains plus the cash dividend.

Blackrock's ... XIU, iShares S&P/TSX 60 Index ETF with an inception date of Sept. 28th, 1999 is widely used in comparisons and I check on it compared to my portfolio where I'm more focused in stocks among the top twenty by dividend yield ranking in the TSX 60 with a growing dividend for income while XIU's distributions bounce around from year to year.

However, looking at XIU's impressive performance returns with 24.96% for the Year to Date (up to Nov 30th, 2024) ... It's a benchmark I would like to match but in most cases, I'll have to sacrifice some performance for the dividend yield.

                               

In the new year, I'll be adding to BNS, Bank of Nova Scotia with an ex-dividend date of January, 7th, 2025 with a current 5.47% yield. The drawback with BNS where I'm looking for dividend growth is that there hasn't been any since 2023. Perhaps in 2025 where the Bank has been making positive moves of late and expanding into the US.

Of the top banks in Canada, TD is the underdog bank going through a CEO transition and beefing up their compliance department. TD's stock will probably have slow growth for awhile but I'll take the 5.34% yield and a recent dividend increase while I wait for better times. The ex-dividend date for TD is on the 10th of January, 2025.

Reading up on the JP Morgan ETFs I got into. Both JEPI and JEPQ with US exposure, will have a varying distribution and yield from month to month going forward. JP Morgan Canada plans to add more ETFs with US and international holdings. TMX Money calculates the yearly yield for JEPI at 6.32% currently and for JEPQ, 14.66% being listed in their Top Dividend 50 list while I'm taking the risk factor into account.

Happy holidays and I look forward to the 2025 events that will rock the stock market world from time to time and I'll see how it all looks mid month January when Canadian Banks have ex-dividend dates plus interesting ETFs.