Resources Out, Defensives In

The market speaks as to which Canadian large-caps are considered “defensive”.

| More on:
The Motley Fool

If you’ve ever wondered whether or not a stock that you own is “defensive”, there is perhaps no better litmus test than a 2% market pull-back.  In a sea of red, a handful of Canadian large-caps are actually up today – so far.

The telecom sector is holding up very well in the face of this resource related meltdown.  Shares in BCE Inc. (TSX:BCE,NYSE:BCE), Telus (TSX:T), and Rogers (TSX:RCI.B,NYSE:RCI) are all benefitting from the river of money currently rushing from the resources.  These 3 stocks are currently up 1.0%, 1.2%, and 0.7% respectively.

Also showing green are the likes of Valeant Pharmaceuticals (TSX:VRX,NYSE:VRX) and Thomson Reuters (TSX:TRI,NYSE:TRI) up 1.0% and 0.3% respectively.  Valeant is probably benefitting from its status as the go-to name in Canada’s healthcare sector.  Healthcare is typically viewed as a defensive sector in most markets, however, given Valeant’s extensive record of acquisitions and highly leveraged balance sheet, this is not your garden variety, steady-eddy healthcare stock.

The Canadian market’s exposure to risky, resource oriented stocks is on full display today.  Because of a reliance on such uncontrollable variables as Chinese GDP growth, the business model of many resource oriented companies is relatively weak.  Canadian investors however deserve to own great businesses and the U.S. market is home to some of the best in the world.  We have created a special report that identifies 3 U.S. businesses that are worthy of your hard earned investment dollars.  Simply click here to receive “3 U.S. Stocks Every Canadian Should Own” – FREE!

Follow us on Twitter and Facebook for the latest in Foolish investing.

Fool contributor Iain Butler does not own shares in any of the companies mentioned at this time.  The Motley Fool has no positions in the stocks mentioned above.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

More on Investing

Illustration of bull and bear
Dividend Stocks

TFSA Investors: 2 TSX Stocks Set to Thrive in the Next Bull Market

Canadian Tire and another dividend growth play that's getting way too cheap to ignore amid the market's turbulence.

Read more »

Bank sign on traditional europe building facade
Bank Stocks

Passive Income: 3 Bank Stocks With Yields Over 5%

High yield bank stocks like the Canadian Imperial Bank of Commerce (TSX:CM) can provide a lot of passive income.

Read more »

edit Businessman using calculator next to laptop
Dividend Stocks

How I’d Invest $20,000 to Earn Reliable Passive Income Today

If you want to turn up your passive income and total-return strategy, check out these top Canadian stocks for a…

Read more »

edit Close-up Of A Piggybank With Eyeglasses And Calculator On Desk
Stocks for Beginners

Investors: How Do Canadian Bank Stocks Stack Up to U.S. Banks?

Here's why Canadian bank stocks could outperform their US peers.

Read more »

Canadian Dollars
Investing

If You Invested $10,000 in Dollarama Stock 10 Years Ago, This Is How Much You Would Have Today

Dollarama stock has been one of the top investments in Canada over the last decade and continues to have impressive…

Read more »

Electric car being charged
Dividend Stocks

2 Growth Stocks to Buy Before a Big Rally

Despite market volatility persistently plaguing the market, these two TSX stocks might be worth considering right now to prepare for…

Read more »

Increasing yield
Energy Stocks

Buy the Dip: 1 Blue-Chip Energy Stock With a Rising Dividend Yield

Suncor Energy (TSX:SU) stock is approaching deep-value territory, making it a top pick for Canadian value and income investors.

Read more »

clock time
Bank Stocks

Is Now the Right Time to Buy CIBC Stock?

CIBC stock offers a big dividend yield. Is CM stock a buy?

Read more »