What to Watch for in the TSX Today

Canadian investors may be able to score with TSX stocks like Lithium Americas Corp. (TSX:LAC)(NYSE:LAC) while avoiding housing stocks.

TSX Today

The S&P/TSX Composite Index climbed 176 points on Monday, September 19. Investors had reason for celebration after the Toronto Stock Exchange (TSX) suffered three days of triple-digit losses in the previous week. United States indexes were also throttled over the same period.

Today, I want to discuss some of the developments you should watch for on the TSX on Tuesday, September 20.

The Battery Metals TSX Index is still on fire

The S&P/TSX Battery Metals Index put together the best performance among its peers during yesterday’s trading session. Investors may be turning to alternative stores of value as we are entering dangerous economic waters.

Teck Resources (TSX:TECK.B)(NYSE:TECK) is a Vancouver-based company that is engaged in the exploration, acquisition, development, and production of natural resources in North America and around the world. Shares of this TSX stock rose 3.71% on Monday, September 19. The stock is up 19% in the year-to-date period.

In the second quarter of 2022, the company saw its adjusted profit more than quadruple to $1.8 billion, or $3.30 per share. This stock currently possesses a very favourable price-to-earnings ratio of 4.3. Teck Resources offers a quarterly dividend of $0.125 per share, which represents a modest 1.1% yield.

Lithium Americas (TSX:LAC)(NYSE:LAC) is another Vancouver-based company. It is focused on lithium extraction in the United States and Argentina. Shares of Lithium Americas jumped 3% on September 19. However, the stock is down 9% so far in 2022.

The lithium space has been reinvigorated by electric vehicle sales and the promise of surging demand in the years and decades ahead. Lithium Americas has made solid progress towards production, but it is still early days. Investors looking for a high-reward play should consider this TSX stock right now.

Telecom takes a hit

The S&P/TSX Capped Communication Services Index dipped marginally on Monday, September 19. Like its peers on the broader index, this subsector has declined steadily since the middle of April.

BCE (TSX:BCE)(NYSE:BCE) is the largest telecom on the TSX by market cap. This stock still rose marginally at yesterday’s close. However, its shares are down 5% in 2022.

This telecom unveiled its second-quarter fiscal 2022 earnings on August 4. It posted revenue growth of 2.9% to $5.86 billion. Meanwhile, adjusted net earnings jumped 5.3% to $791 million. Shares of this telecom stock possess a favourable price-to-earnings ratio of 19. It offers a quarterly dividend of $0.92 per share. That represents a strong 5.8% yield.

Rogers Communications has struggled in 2022. It gained the ire of consumers after its long and widespread outage on July 8. This stock fell 1.4% on September 19. Shares of Rogers are down 8.5% in the year-to-date period.

Storm clouds for Canada housing: How will the TSX react?

Royal Bank recently predicted that home prices in Canada would bottom out by the spring of 2023. The Canadian Real Estate Association (CREA) has projected that home prices will decline 20% by the end of 2022 compared to the peak in 2021. Royal Bank chief economist Robert Hogue is projecting a 23% drop in 2022 and a further 14% dip in 2023. That could push many recent home buyers into dangerous territory, especially with interest rates already applying major pressure.

Home Capital is a top alternative lender and a TSX stock worth monitoring during this turbulent period for Canada housing. Its shares have plunged 27% so far in 2022. That has pushed the stock into negative territory in the year-over-year period.

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.

Fool contributor Ambrose O'Callaghan has no position in any of the stocks mentioned. The Motley Fool recommends ROGERS COMMUNICATIONS INC. CL B NV. The Motley Fool has a disclosure policy.

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