Stan Wong, Portfolio Manager, Scotia Wealth Management
Focus: North American Large Caps & ETFs
Top Picks: Loblaw, Rio Tinto, Vertiv Holdings
MARKET OUTLOOK:
Equity markets continue to navigate a complex backdrop of geopolitical tensions, resilient economic growth, and structural shifts in global supply chains.
Recent U.S. economic data reflects resilience, with consumer spending firm, labour markets stable, and corporate balance sheets healthy.
Market leadership is also beginning to broaden beyond mega-cap technology companies, with stronger participation across industrials, financials, energy, and select cyclical sectors.
Corporate fundamentals remain constructive, with consensus estimates suggesting S&P 500 earnings-per-share growth will exceed 13 per cent in 2026 and 15 per cent in 2027, buoyed by continued investment in artificial intelligence, digital infrastructure, electrification, and productivity-enhancing technologies.
Geopolitical developments are reshaping global investment priorities. Supply-chain security concerns and shifting trade dynamics are accelerating near-shoring and onshoring, particularly across North America, as governments and corporations expand domestic manufacturing capacity, energy infrastructure, and logistics networks.
These trends are driving a broader global capital spending cycle tied to AI infrastructure, electrification, and supply-chain realignment, supporting demand for industrial goods, energy, and critical commodities. Improving earnings revisions and relative valuations are also increasing the appeal of international and emerging market equities as currency pressures that previously favored U.S. assets begin to ease.
While volatility may persist amid geopolitical developments, evolving monetary policy expectations, and the approaching U.S. midterm election cycle, energy markets remain an important variable. Oil prices approaching US$100 per barrel could pressure inflation expectations and weigh on global growth. Even so, inflation is trending toward central bank targets, labour markets remain stable, and roughly US$7.8 trillion in money-market assets represents a meaningful pool of capital that could gradually rotate back into risk assets.
At The Stan Wong Group, we focus on high-quality large-cap equities, emphasizing durable cash flow, competitive advantages, and sustainable earnings growth within portfolios aligned with each client’s broader total wealth plan.
TOP PICKS:
Loblaw (L TSX)
Loblaw Companies is Canada’s largest food and pharmacy retailer, operating a nationwide network of grocery stores, pharmacies, and discount retail banners. The company’s portfolio includes well-known brands such as Loblaws, Real Canadian Superstore, No Frills, and Shoppers Drug Mart, giving it a strong presence across multiple retail formats and price points. This scale provides Loblaw with significant purchasing power, supply chain advantages, and a broad national footprint in essential consumer categories.
We view Loblaw as well positioned to benefit from the defensive nature of food retail and pharmacy services. Grocery spending tends to remain stable even during periods of economic uncertainty, as food is a non-discretionary purchase.
The Canadian grocery market is also relatively concentrated, with a small number of large national operators controlling much of the market.
This structure supports pricing discipline and helps maintain strong market share positions for leading companies like Loblaw.
Loblaw also benefits from strong private-label brands such as President’s Choice and No Name, which have gained popularity as consumers seek value-oriented products. The Shoppers Drug Mart segment adds another important growth driver through pharmacy services, health products, and beauty retailing. Loblaw is expected to generate approximately $65.7 billion in fiscal 2026 revenue, reflecting its dominant position in Canadian food and pharmacy retailing. With its national scale, resilient demand profile, and diversified retail platform, we believe Loblaw represents a high-quality defensive consumer company capable of delivering steady earnings growth across varying economic environments.
Rio Tinto PLC (RIO NYSE)
Rio Tinto is one of the world’s largest diversified mining companies and a leading producer of iron ore, copper, and aluminum – materials that form the backbone of global infrastructure and industrial development. Headquartered in the United Kingdom, the company operates large-scale mining assets across multiple continents and maintains some of the highest-quality resource deposits in the industry. Its scale, long-life assets, and low-cost production profile have historically allowed Rio Tinto to generate strong cash flow across commodity cycles.
We view Rio Tinto as well positioned to benefit from several powerful long-term trends, including electrification, global infrastructure investment, and the energy transition. Copper and aluminum are essential for power grids, renewable energy projects, and electric vehicles, while iron ore remains critical for steel used in construction and transportation. At the same time, the rapid expansion of artificial intelligence infrastructure and data centers is expected to drive increased electricity demand, which in turn requires significant investment in power generation and grid expansion – both of which depend heavily on industrial metals.
Rio Tinto’s portfolio of large, long-life mining assets provides strong leverage to these trends while maintaining a disciplined approach to capital allocation and cost control. The company is expected to generate nearly US$60 billion in fiscal 2026 revenue and currently offers a dividend yield of 4.4 per cent, providing investors with both income and exposure to global commodity demand. With metals playing a critical role in electrification, infrastructure development, and industrial expansion, we believe Rio Tinto remains well positioned to benefit from the long-term growth in demand for essential industrial materials.
Vertiv Holdings (VRT NYSE)
Vertiv is a global provider of critical infrastructure supporting data centers, communications networks, and high-performance computing facilities. The company operates in more than 130 countries and specializes in power management systems, thermal cooling technologies, and integrated infrastructure solutions that help keep digital systems running reliably. These technologies are essential for modern data centers, where maintaining uptime, managing heat, and delivering stable power are mission critical.
We view Vertiv as one of the clearest infrastructure beneficiaries of the artificial intelligence boom. AI computing requires far greater power density and generates significantly more heat than traditional data processing. As companies deploy powerful graphics processors and build large AI clusters, data centers must invest heavily in advanced cooling systems and power distribution equipment to maintain performance and reliability. Vertiv’s solutions are designed specifically for these high-performance environments, positioning the company at the center of this infrastructure spending cycle.
Importantly, data centers operate 24 hours a day, 365 days a year, which means reliable power delivery and cooling are absolutely essential. Vertiv’s products help ensure these facilities remain operational and efficient, making the company an important supplier to hyperscale cloud providers and technology companies expanding their digital infrastructure. Vertiv is expected to generate over US$13.5 billion in fiscal 2026 revenue, supported by strong demand and growing order momentum. As artificial intelligence adoption and cloud computing continue to expand globally, we believe Vertiv remains well positioned to benefit from the multi-year buildout of data center infrastructure powering the digital economy.
| DISCLOSURE | PERSONAL | FAMILY | PORTFOLIO/FUND |
|---|---|---|---|
| L TSX | Y | Y | Y |
| RIO NYSE | Y | Y | Y |
| VRT NYSE | Y | Y | Y |
PAST PICKS: MARCH 13, 2025
Expedia Group (EXPE NASD)
Then: US$157.11
Now: US$230.35
Return: 47%
Total Return: 48%
Mastercard (MA NYSE)
Then: US$519.83
Now: US$504.00
Return: -3%
Total Return: -2%
Netflix (NFLX NASD)
10-For-1 Stock Split Nov. 17, 2025
Then: US$890.17
Now: US$94.89
Return: 7%
Total Return: 7%
Total Return Average: 18%
| DISCLOSURE | PERSONAL | FAMILY | PORTFOLIO/FUND |
|---|---|---|---|
| EXPE NASD | Y | Y | Y |
| MA NYSE | N | N | N |
| NFLX NASD | Y | Y | Y |