July 18, 2022 Newsletter

Dear Friends,

Tangents: Happy Monday.
Ocean Day in Japan – markets closed.

Pilot deploys parachute, plane crashes into sidewalk outside Bruges.  Luckily the pilot’s life was saved, and the incident caused minimal damage… but it was a close call. Watch footage of the crash-landing here. 

10 scenic and remote museums and galleries that are worth the trip.  Wow, this museum nestled on a mountain in Italy is absolutely breathtaking. View this list if you appreciate stunning natural beauty.

San Francisco opens a park atop a busy highway tunnel.  Developers repurposed this unusual space to create a 14-acre urban oasis.
 
Iceland’s forest cover has grown sixfold in the past 30 years.

Hidden Van Gogh self-portrait discovered under ‘peasant woman’ painting: Conservators at the National Galleries of Scotland recently experienced quite a surprise after they X-rayed a painting by Vincent van Gogh. Hidden on the reverse side of the painting “Head of a Peasant Woman,” which Van Gogh completed in 1885, was a previously unknown self-portrait of the Dutch painter staring back at them.  The hidden self-portrait had been obscured by layers of glue and cardboard that had been attached to the back of the canvas; museum officials suspect the materials were applied sometime during the early 20th century to help protect the artwork for an upcoming exhibition, National Galleries representatives said in a statement.  Full Story: Live Science (7/16)

Cave explorers discover a 19th-century mining scene preserved like a time capsule:  Leather shoes, clay pipes, a mysterious inscription written in candle soot — these are just a few of the artifacts a group of cavers recently discovered in a centuries-old cobalt mine in Cheshire, England.  The mine, located near Manchester in a village called Alderley Edge, was once a source of cobalt, an element mined for the brilliant blue pigment imbued on pottery and glass. Cobalt mining was a lucrative trade for England in the 19th century. But imports from other countries became cheaper than English cobalt, so this particular mine, owned by Sir John Thomas Stanley in the early 1800s, was abandoned around 1810.  Full Story: Live Science (7/18) 

What human-made structures can be seen from space?
You’ve undoubtedly heard people say the Great Wall of China can be seen from space. But is that really true? In fact, is it possible to see any human-made structure from beyond Earth’s atmosphere?   To answer that question, first we need to define where Earth’s atmosphere ends and outer space begins. The Kármán line, named after physicist Theodore von Kármán, is widely considered the boundary between Earth and space. Typically, it’s defined as 100 kilometers (62 miles) above our planet’s surface.   So, what can be seen from that far up? On a clear day, would someone at the Kármán line be able to see the Great Wall of China or the Great Pyramid of Giza, for example?
Full Story: Live Science (7/16) 

PHOTOS OF THE DAY

A member of the Queen’s Guard receives some water outside Buckingham Palace in extreme hot weather
CREDIT: John Sibley/Reuters

A woman goes for a run on the outskirts of the city in the cooler early morning. High temperatures are expected all over Germany on Monday and Tuesday
CREDIT: Michael Probst/AP

Swans on the River Thames
CREDIT: Maureen McLean/Rex/Shutterstock

Market Closes for July 18^th, 2022

International Markets

Bonds

Currencies

Commodities

Market Commentary:
On this day in 1968, Robert Noyce and Gordon Moore, engineering refugees from Fairchild Semiconductor, established N.M. Electronics Corp. to miniaturize electronic circuitry onto silicon chips. The firm, based in a small leased building in Mountain View, Calif., generated $2,672 in revenues its first year. It soon changed its name to Intel Corp.
Canada
By Ana Paula Barreto Pereira
(Bloomberg) — Canadian equities gained for the second day, led by oil and gas stocks as crude oil prices rallied above $102 per barrel.
The S&P/TSX Composite climbed 1.1%, or 201.17 to 18,595.62 in Toronto. The advance was the biggest since rising 1.8% on July 7.
Royal Bank of Canada contributed the most to the index gain, increasing 1.8%.
Canopy Growth Corp. had the largest percentage increase, rising 15.5%.
Today, 193 of 238 shares rose, while 43 fell; 9 of 11 sectors were higher. 
Insights
* The index declined 7% in the past 52 weeks. The MSCI AC Americas Index lost 13% in the same period
* The S&P/TSX Composite is 16.3% below its 52-week high on April 5, 2022 and 2.3% above its low on July 14, 2022
* The S&P/TSX Composite is down 1.2% in the past 5 days and fell 1.8% in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 14.5 on a trailing basis and 11.3 times estimated earnings of its members for the coming year
* The index’s dividend yield is 3.2% on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$2.95t
* 30-day price volatility rose to 19.48% compared with 19.02% in the previous session and the average of 19.67% over the past month
================================================================
|Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
* Energy | 90.7700| 2.8| 38/0
* Financials | 60.9725| 1.1| 25/4
* Materials | 23.3339| 1.1| 41/9
* Information Technology | 15.7751| 1.5| 10/4
* Real Estate | 7.2686| 1.5| 21/1
* Industrials | 5.3660| 0.2| 25/4
* Consumer Discretionary | 5.3453| 0.8| 12/1
* Health Care | 1.4328| 1.9| 6/1
* Communication Services | 0.9531| 0.1| 4/3
* Utilities | -2.4316| -0.2| 8/8
* Consumer Staples | -7.6234| -1.0| 3/8
================================================================
| | |Volume VS |
| Index | | 20D AVG |YTD Change
Top Contributors |Points Move| % Change | (%) | (%)
================================================================
* Royal Bank of Canada | 21.1900| 1.8| 53.4| -10.0
* Canadian Natural Resources | 13.9200| 2.8| -33.0| 18.5
* Enbridge | 13.8300| 1.8| 96.0| 11.6
* Thomson Reuters | -2.8300| -1.8| 0.5| -10.0
* Waste Connections | -4.7320| -1.7| -13.4| -7.6
* Couche-Tard | -5.5630| -1.9| -45.1| -2.9
US
By Stephen Kirkland and Vildana Hajric
(Bloomberg) — US stocks turned sharply lower after Apple Inc.’s plans to slow hiring added to investor worries that the Federal Reserve’s campaign against inflation will drop the economy into a recession.
The S&P 500 extended losses in the last hour of trading, after coughing up a gain that had surpassed 1%.
Tech and health-care shares led the drop, with Apple sliding more than 2% in its worst day in almost three weeks.
The iPhone maker plans to slow hiring and spending growth next year in some divisions to cope with a potential economic downturn, people with knowledge of the matter said.
The news follows a similar move by Alphabet Inc. last week.
Netflix Inc. will kick off second-quarter earnings for major tech and communication companies when it reports Tuesday evening.
Profit growth for the sector is expected to slow sharply.
Earlier, Goldman Sachs Group Inc. reported better-than-expected results, sending its shares higher.
Stocks had been rebounding from their June low on expectations that the Fed is starting to gain ground in its efforts to slow price gains.
Treasuries slumped Monday, with 10-year yields below 3% — still lower than the 2-year rate, leaving the curve inverted in what is generally a recession warning.
“What’s been holding us up of course is jobs, so now as we start to get these announcements jobs aren’t maybe as stable, now you’re seeing the impetus toward recession,” said Dana D’Auria, co-CIO at Envestnet Solutions, on Bloomberg Television.
After the bell, International Business Machines Corp. reported sales that beat estimates, a sign that demand for mainframe computers, consulting and cloud services remained strong.
The shares were little changed in extended trading.
Another pressure point for markets remains gas supply to Europe amid a standoff with Russia over its invasion of Ukraine, with the Nord Stream 1 pipeline scheduled to reopen Thursday following maintenance.
Gazprom PJSC declared force majeure on several European natural-gas buyers, a move that may signal it intends to keep supplies capped.
The S&P 500 is up more than 5% from June’s closing low following Friday’s strong rally on renewed hopes that inflation — and Fed rate hikes — may be close to peaking.
Data last week showing a greater decline in US consumers’ long-term inflation expectations helped squash talk of a 100 basis-point hike in July, while strong retail sales underscored a resilient economy.

“You have to be very careful in how you’re allocating assets and allocating dollars in this market — but you had a couple of really good numbers this morning from Goldman and Bank of America, on the back of good retail sales,”
said Chuck Cumello, president and chief executive officer of Essex Financial Services. “And the key thing in the US economy is the consumer” and, he said, “people are out spending.”
Elsewhere in markets Monday, West Texas Intermediate crude climbed above $100 a barrel after the Saudis declined to make any promises regarding future output increases, and copper extended its recovery from last week’s slump. Bitcoin rallied, trading above $22,000 for the first time since early June.
More market commentary:
* “The key for the markets continues to be the overall direction of the economy,” wrote Paul Nolte, portfolio manager at Kingsview Investment Management. “If the recession that is heading our way is mild, then much of the decline has already occurred, and this is a good time to accumulate shares. If the recession is deeper/longer, then there is a risk of another 15% decline in stocks from here.”
* “Our call remains that the economy will slow aggressively over the next 6-12 months and bond yields are headed lower, but a recession is not imminent,” wrote Dennis DeBusschere, the founder of 22V Research. “That backdrop has implications for factors and markets near term, especially as disinflationary forces continue to strengthen.”
* “The possibility that Russia stops, or severely reduces, their gas exports to Europe should keep markets on edge in the near-term,” Mizuho International Plc strategists Peter McCallum and Evelyne Gomez-Liechti wrote in a note to clients.

Key events to watch this week:
* Earnings this week include Tesla
* US Treasury Secretary Janet Yellen visits South Korea. Tuesday
* Reserve Bank of Australia releases July minutes. Tuesday
* UK Chancellor Nadhim Zahawi and Bank of England Governor Andrew Bailey speak at event. Tuesday
* Bloomberg Crypto Summit in New York. Tuesday
* Bank of Japan, European Central Bank rate decisions. Thursday
* Nord Stream 1 pipeline scheduled to reopen following maintenance. Thursday

Some of the main moves in markets:
Stocks
* The S&P 500 fell 0.8% as of 4 p.m. New York time
* The Nasdaq 100 fell 0.9%
* The Dow Jones Industrial Average fell 0.7%
* The MSCI World index was little changed
Currencies
* The Bloomberg Dollar Spot Index fell 0.4%
* The euro rose 0.6% to $1.0145
* The British pound rose 0.8% to $1.1955
* The Japanese yen rose 0.4% to 138.07 per dollar
Bonds
* The yield on 10-year Treasuries advanced five basis points to 2.97%
* Germany’s 10-year yield advanced eight basis points to 1.22%
* Britain’s 10-year yield advanced seven basis points to 2.16%
Commodities
* West Texas Intermediate crude rose 4.8% to $102.29 a barrel
* Gold futures were little changed
–With assistance from Lynn Thomasson, Andreea Papuc, Sunil Jagtiani, Verity Ratcliffe, Denitsa Tsekova and Emily Graffeo.
Have a lovely evening.

Be magnificent!
As ever,

Carolann

Before you can inspire with emotion, you must be swamped with it yourself.
Before you can move their tears, your own must flow.   To convince them,
you must yourself believe. -Winston Churchill, 1874-1965.

Carolann Steinhoff, B.Sc., CFP®, CIM, CIWM
Senior Investment Advisor

Queensbury Securities Inc.,
St. Andrew’s Square,
Suite 340A, 730 View St.,
Victoria, B.C. V8W 3Y7

Tel: 778.430.5808
(C): 250.881.0801
Toll Free: 1.877.430.5895
Fax: 778.430.5828
www.carolannsteinhoff.com