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The Canadian AI equity story is real, but different. In the States it's all about the AI ecosystem, and sitting at the top of the hill are the hyperscalers.

In Canada, it's more of a multi-theme portfolio rather than a single AI stock or ETF. It's more about the infrastructure enablers. We don't really have hyperscalers here, but we have some fantastic enablers. Think of CLS. The poster child for industrial AI software is SHOP. We also have power and data centre beneficiaries, such as ENB, FTS, EMA, and H.

You can drill down further into space and defense AI. The first one that comes to mind is MDA.

Is merging with Eli Lilly. Doesn't see upside. A spec at best.

Yes, if this was a conversation about JPM. No, if we're talking about the Canadian banks. If the Canadian banks were to have massive job cuts, that'll be a problem to navigate politically. You can't have banks firing tens of thousands of people in Canada when employment's really weak. It would be really bad optics.

The sector enjoys a very cosy, highly profitable oligopoly in Canada. You don't want to risk aggressive job cuts. To do so would be penny wise, pound foolish. He acknowledges that our banks are probably not the most efficient, especially compared to those in the US.

The rotation began in mid-June as the momentum stocks took it on the chin, rotating into materials and healthcare and coming out of utilities, especially the last 6 weeks. Seasonally, September sees weaker performance. Then there is the US election this making. The environment is weaker. But we saw strong growth in corporate earnings, and saw a correction in tech. Will there be more rotation? Higher valuations are a concern, but bull markets don't end on valuation--there needs to be another catalyst to end a bull market. Some tech names now have lower valuations and look attractive. He's looking at materials (Canada) and healthcare (US).