Month: November 2011

 

Dear Friends,

Tangents: Sorry, no newsletter last night because our office building was hit with the power outage that affected much of downtown intermittently yesterday as a result of B.C. Hydro’s problems.  

Today: 1989, Czechoslovakia ends Communist rule.           

            1878, writer C.S. Lewis was born.

            1832, writer Louisa May Alcott was born.

I was reading an article in the most recent edition of The New Yorker last night that reminded me of the debate going on in Canada right now over the beaver as our national symbol.   It was a commentary by Adam Gopnik in honor of the U.S. Thanksgiving holiday last Thursday on how the turkey almost became the symbol of America.  Benjamin Franklin disliked the choice of the bald eagle as the national bird, and it was in a letter to his daughter, in 1784, that he proposed putting the turkey in its place.  The eagle, Franklin points out, is “a bird of bad moral character.  He does not get his living honestly….He watches the labor of the fishing hawk; and when that diligent bird has at length taken a fish, and is bearing it to his nest for the support of his mate and young ones, the bald eagle pursues him, and takes it from him.”  Truly, a one-per-cent kind of bird. 

Photos of the day

November 29, 2011

Green Peace activists dressed as trees protest the deforestation of the Brazilian Amazon jungle in Durban, South Africa on the second day of the two-week UN climate conference attended by 192 parties seeking agreement on future action to curb climate change. John Robinson/Green Peace/AP.

Ecuador’s Tungurahua volcano spews volcanic lava accompanied by large clouds of gas and ash near Banos, south of Quito. Authorities are encouraging residents living near the volcano to evacuate. The Tungurahua volcano has been in an active state since October 1999. Carlos Campana/Reuters.

Market Commentary:

Canada

By Matt Walcoff

Nov. 29 (Bloomberg) — Canadian stocks rose for a second day as energy stocks gained with natural gas futures on forecasts for colder temperatures in the northern U.S. and banks and Research In Motion Ltd. rallied.

Canadian Natural Resources Ltd., Canada’s second-largest energy company by market value, advanced 3.3 percent. Royal Bank of Canada, the country’s biggest lender by assets, increased 1.6 percent after the U.S. Conference Board reported higher consumer confidence. RIM, the BlackBerry maker, climbed 5.8 percent after an analyst at Sanford C. Bernstein & Co. raised his rating on the shares.

The Standard & Poor’s/TSX Composite Index rose 92.29 points, or 0.8 percent, to 11,732.50.

“Natural gas seems to have a little bit of life, and oil, no matter what the economy seems to be doing, stays around $100” a barrel, Marcus Xu, director of equity investments at Genus Capital Management in Vancouver, said in a telephone interview. The firm oversees about C$1.7 billion ($1.7 billion). “That’s good for Canadian companies.”

The S&P/TSX surged 1.6 percent yesterday after falling each of the previous four weeks, the longest streak of weekly drops since July 2008. The index has fluctuated with developments in the European debt crisis this quarter as concern that problems in Greece, Italy and Spain will hurt the global economy has overshadowed growth in Canadian companies’ profits.

Energy stocks advanced after AccuWeather Inc. forecast below-normal temperatures for New York and Chicago. Crude oil increased for a third day on the U.S. consumer confidence report.

Canadian Natural climbed 3.3 percent to C$36.35. Suncor Energy Inc., the country’s largest oil and gas producer, rose 1.5 percent to C$29.35. Athabasca Oil Sands Corp., PetroChina Co.’s partner in oil-sands development, jumped 5.1 percent to C$11.63.

Nexen Inc., an oil and gas producer with operations on five continents, advanced 4.5 percent to C$15.95 after agreeing to sell a 40 percent stake in British Columbia shale-gas fields to Tokyo-based Inpex Corp. and JGC Corp.

Canada’s seven largest banks each climbed after the New York-based Conference Board said its index of consumer confidence rose more than all 70 economist forecasts in a Bloomberg survey.

Royal Bank gained 1.6 percent to C$45.01. Toronto-Dominion Bank, its biggest domestic rival, increased 1.1 percent to C$69.63. Bank of Montreal, Canada’s fourth-largest lender by assets, advanced 1.2 percent to C$57.41.                        

RIM climbed 5.8 percent to C$18 after Pierre Ferragu, an analyst at Bernstein, raised his rating on the stock to “market perform” from “underperform.” The shares had plunged 71 percent this year through yesterday.

“As the failure of RIM’s current strategy becomes more obvious, we see shareholder activism leading to a change in management and a takeover — or at least the anticipation of it,” Ferragu wrote in a note to clients.

Shares also rallied after Alan Panezic, vice president of platform product management said in an interview that RIM will offer companies software to support competing smartphones. Laszlo Birinyi, founder of Westport, Connecticut-based Birinyi Associates Inc., recommended RIM shares in an interview on CNBC.

Raw-materials producers in the S&P/TSX rose as the U.S. dollar fell against all other major currencies and gold and copper gained.

Goldcorp Inc., the world’s second-biggest gold producer, advanced 1 percent to C$51.24. San Gold Corp., which operates in Manitoba, rallied 10 percent to C$1.80 after closing at the lowest since April 2009 yesterday. SouthGobi Resources Ltd., which mines coal in Mongolia, rose 7.6 percent to C$7.21.

Mercator Minerals Ltd., a copper and molybdenum producer, surged 9.8 percent to C$1.68. Jeffrey Woolley, an analyst at Paradigm Capital Inc., began coverage of the company with a “buy” rating in a note dated yesterday.

US

By Michael P. Regan and Rita Nazareth

Nov. 29 (Bloomberg) — Stocks and commodities rose for a second day as U.S. consumer confidence increased by the most since 2003 and European finance ministers discussed efforts to tame the region’s debt crisis. Treasuries pared losses.

The Standard & Poor’s 500 Index added 0.2 percent to 1,195.19 at 4 p.m. in New York, trimming its rally from 0.9 percent. The Stoxx Europe 600 Index rose 0.8 percent. The euro climbed 0.1 percent $1.3329 after earlier erasing a gain of as much as 0.9 percent. The S&P GSCI gauge of 24 commodities advanced 1.3 percent as oil approached $100 a barrel. Ten-year U.S. Treasury yields rose two basis points to 2 percent after dropping 1 point.

U.S. equities added to yesterday’s rally after the Conference Board’s sentiment gauge climbed to 56 from a revised 40.9 in October as consumers grew more optimistic about jobs and income prospects. Europe’s effort to expand its bailout fund to 1 trillion euros ($1.3 trillion) is falling short and finance ministers tonight will discuss channeling European Central Bank loans to struggling nations through the International Monetary Fund.

“The economic reports have shown that the U.S. has been insulated from all the noise coming out of Europe,” Paul Zemsky, the New York-based head of asset allocation for ING Investment Management, said in a telephone interview. His firm oversees $550 billion. “Consumers are not really bothered by that, at least not yet.”

The S&P 500 snapped a seven-day slump yesterday, rallying 2.9 percent for its largest gain in a month, after Thanksgiving- weekend retail sales rose to a record and speculation grew that European leaders would increase efforts to fight the region’s debt crisis.

Today’s gains were led by energy, utility and consumer staples companies. Hewlett-Packard Co., Home Depot Inc. and Exxon Mobil Corp. climbed at least 1.3 percent to pace gains in the Dow Jones Industrial Average.

AMR Corp., the parent of American Airlines, tumbled 79 percent after filing for bankruptcy as it failed to secure cost- cutting labor agreements. Corning Inc., the world’s largest maker of glass for flat-panel televisions, plunged 11 percent to lead a drop in technology shares after cutting its fourth- quarter earnings forecast because of the loss of a contract and lower glass prices.

The reading of 56 in the Conference Board’s confidence gauge topped the most optimistic economist forecast in a Bloomberg survey and compared with the median estimate of 44.

The report was the third-strongest relative to expectations since at least 1999, Bespoke Investment Group LLC said in a note to clients today, and the S&P 500 has rallied on average 1.3 percent on days when the number beat the consensus forecast by 10 or more.

“What it may indicate is that the U.S. equity market has made its low for 2011 since major lows in the equity market do often coincide with lows in consumer confidence,” Michael Shaoul, chairman of Marketfield Asset Management in New York, said in a note to clients.

The Dollar Index, which tracks the U.S. currency against those of six trading partners, declined 0.3 percent. The S&P GSCI index extended yesterday’s 1.4 percent rally as wheat and natural gas climbed more than 2.9 percent to lead gains in 18 of 24 commodities.                     

Federal Reserve Vice Chairman Janet Yellen said the central bank has leeway to spur the U.S. recovery and reduce unemployment by purchasing more assets and clarifying its plan to sustain record-low borrowing costs. Fed Bank of Atlanta President Dennis Lockhart said expanding securities purchases is unlikely to give a sufficient boost to U.S. growth, without ruling out the strategy or other easing options.

Oil climbed 1.6 percent to $99.79 a barrel and earlier topped $100 a barrel in New York as Iranian protesters broke into and vandalized the British Embassy’s compound in Tehran.

Among European stocks, Remy Cointreau jumped 2.9 percent after France’s second-biggest distiller predicted “a substantial increase” in full-year earnings. BASF SE and K+S AG pulled a gauge of chemical makers higher, rising more than 2 percent. IG Group Holdings Plc rallied 9.3 percent, the most since 2010. Italy was again forced to sell bonds at rates exceeding 7 percent today, a level that led Greece, Portugal and Ireland to seek bailouts.               

 Italy sold 3.5 billion euros in three-year debt, 2.5 billion euros of 2022 bonds and 1.5 billion euros in 2020 bonds.

The 2014 note yielded 7.89 percent, the highest since 1996 for a three-year bond and up from 4.93 percent when similar-maturity debt was sold last month. Demand for the 2014 bond was 1.5 times the amount sold and the bid-to-cover for the 2022 bond was 1.34 times, both higher than Oct. 28 auctions.

“High yields are not a real surprise, given the recent developments in Italian yields,” Annalisa Piazza, a strategist at Newedge Group in London, wrote in a report. “Bid-cover was higher than at the previous auction at the end of October as very cheap valuations might have attracted some interest.”

The yield on Italian 10-year bonds increased less than one basis point to 7.24 percent after rising as high as 7.38 percent, while two-year yields slipped one basis point to 7.10 percent after increasing to as high as 7.37 percent earlier.

German 10-year bund yields increased three basis points to 2.33 percent, while yields on U.K. and French 10-year debt decreased. U.S. 30-year bond yields rose three points to 2.96 percent after earlier dropping below German counterparts for the first time since 2009.

Finance ministers tonight are holding an initial discussion on channeling ECB loans to cash-strapped euro nations through the International Monetary Fund, aiming to bring the central bank onto the front lines without violating its ban on direct lending to governments, said people familiar with the situation, who declined to be identified because the talks are at an early stage.

Luxembourg Finance Minister Luc Frieden said the European Financial Stability Facility alone won’t be able to solve the euro region’s debt crisis. The EFSF will need help from the IMF and the European Central bank, Frieden told reporters in Brussels today before a meeting of euro area finance chiefs.

The cost for European banks to fund in dollars rose to the highest level since October 2008 for a fifth day. The three- month cross-currency basis swap, the rate banks pay to convert euro payments into dollars, was 158 basis points below the euro interbank offered rate, from minus 149 basis points yesterday.

The gap has widened from as little as minus 8 basis points on May 4. The MSCI Emerging Markets Index climbed 1 percent.

Benchmark gauges for China, South Korea, Taiwan and Indonesia gained more than 1 percent, while indexes in Russia and India dropped. Egypt’s EGX-30 Index jumped 5.5 percent, the most since 2009 on a closing basis, after a peaceful first day of parliamentary elections.

Have a wonderful evening everyone.

Be magnificent!

 

We think as our ancestors did, away back in pre-historic ages.

Where even tradition cannot pierce the gloom of that past,

there our glorious ancestors have taken up their side of the problem

and have thrown the challenge to the world.

Our solution is renunciation, giving up, fearlessness, and love;

these are the fittest to survive.  Giving up the senses makes a nation survive.

 

      -Swami Vivekananda, 1863-1902

As ever,

Carolann

Under capitalism , man exploits man.  Under communism,

it’s just the opposite.

                 -John Kenneth Galbraith, 1908-2006

 

Dear Friends,

  “There are but two levers which move men – Fear and Interest…”

 -Napoleon Bonaparte

Photo of the Day:

Ed Manders makes final adjustments to lighting artist Bruce Munro’s latest installation Field of Light in the grounds of the Holbourne Museum in Bath, England. (Getty Images)

 

Market Commentary:

Canada 

By Kaitlyn Kiernan

 Nov. 25 (Bloomberg) — Canadian stocks fell for a third day, heading for a fourth straight weekly decline, as the country’s Finance Minister said contagion from the European debt crisis is spreading.

 Suncor Energy Inc., Canada’s biggest oil and gas producer, fell 1.7 percent. Royal Bank of Canada, the nation’s biggest lender, fell 1.2 percent, leading a decline in financial shares. The Standard & Poor’s/TSX Composite Index fell 49.91 points, or 0.4 percent, to 11,441.30 at 2:08 p.m. in Toronto. The index has dropped 3.8 percent in five days, heading for the longest streak of weekly losses since July 2008. “The Canadian economy is a very open economy with exports making up a large part of GDP, so there are a lot of worries about the global situation,” Stephen Gauthier, a portfolio manager at Fin-XO Securities in Montreal, said in a telephone interview. The firm oversees about C$600 million ($573.5 million). “We’ve been losing a lot of ground the last few days because we are waiting to see what is going to happen on a worldwide basis.”

The S&P/TSX fell 15 percent this year though yesterday as it heads toward its first yearly decrease since 2008 and second in nine years. S&P/TSX Materials and Energy indexes lost 19 percent and 18 percent, respectively, this year as the European debt crisis threatened to curb global growth. Energy and raw- materials companies make up 47 percent of Canadian stocks by market value, the most among major developed markets, according to Bloomberg data.

 Stocks erased earlier gains after Reuters reported that Greece is demanding that new bonds issued to investors as part of a debt swap have a net present value of 25 percent, lower than the “high 40s the banks have in mind.” Jim Flaherty, the Canadian Minister of Finance, said in the text of a speech in Toronto that Europe’s debt crisis is creating “contagion” outside the region and policy makers must act while the situation can still be stabilized.

Energy shares fell 0.7 percent as a group after climbing as much as 0.5 percent earlier. Suncor fell 1.7 percent to C$28.27. Canadian Natural Resources Ltd., the country’s second-largest energy company by market value, fell for a seventh day, slipping 1.8 percent to C$34.13. TransCanada Corp., the owner of the country’s largest pipeline system, lost 0.7 percent to C$40.69. Royal Bank of Canada slid 0.8 percent to C$43.57. Bank of Nova Scotia, the third-biggest lender, fell 0.6 percent to C$48.05. Toronto-Dominion Bank, the country’s second-largest lender by assets, lost 0.6 percent to C$68.30.

Guyana Goldfields Inc. gained 5.1 percent to C$8.53. The gold explorer signed confidentiality agreements with six parties interested in buying the company and its Aurora gold project in the South American country, Chief Operating Officer Claude Lemasson said. Harry Winston Diamond Corp., the co-owner of the Diavik mine, climbed 1.8 percent to C$10.36 as diamond prices rose 0.2 percent this week.

  US

 By Michael P. Regan and Rita Nazareth Nov. 25 (Bloomberg) — U.S. stocks slipped, capping the worst Thanksgiving-week loss since 1932, and commodities fell as a reduction in Belgium’s credit rating and reports that Greece is demanding bondholders accept larger losses fueled concern Europe’s debt crisis is worsening. Treasuries fell.

 The S&P 500 declined for a seventh straight day, losing 0.3 percent to close at 1,158.67 at 1 p.m. in New York and extending its weekly retreat to 4.7 percent. The S&P GSCI Index of commodities slipped 0.3 percent. The euro lost 0.9 percent to $1.3229. The Markit iTraxx SovX Western Europe Index of credit- default swaps on 15 governments lingered near a record, up 6 basis points at 386. The dollar rallied against most peers. U.S. equities erased earlier gains as Reuters reported Greece is demanding that new bonds issued to investors as part of a debt swap have a net present value of 25 percent, lower than the “high 40s the banks have in mind.” Greece’s 10-year bond traded at about 24.3 percent of face value as of today’s close. Equities rose earlier amid reports European leaders were discussing sparing private investors from sharing the costs of bailing out troubled nations.

 “The demands of Greece now totally change the game,” Mark Grant, a managing director at Southwest Securities Inc. in Fort Lauderdale, Florida, said in an e-mail. “The situation can no longer be called voluntary by any stretch of the imagination.

The equity markets in the United States may test the lows again as there is increasing concern of a major recession in Europe.” Energy producers and retailers had the biggest declines among 24 industries in the S&P 500, with Exxon Mobil Corp. down 0.9 percent and Amazon.com Inc. slumping 3.5 percent. 

Twenty-two of 30 retailers in the S&P 500 retreated as Black Friday, the biggest retail day of the year, arrived with consumer sentiment at levels previously reached during recessions, as a record share of households said this is a bad time to spend, according to the Bloomberg Consumer Comfort Index. The measure has reached minus 50 or less in nine of the past 10 weeks, an unprecedented performance in its 26-year history. Banks advanced following reports that some European officials oppose forcing private investors to share the cost of bailing out countries with the region’s permanent rescue fund.

German Chancellor Angela Merkel and French President Nicolas Sarkozy “confirmed their support for Italy, saying that they are aware that the collapse of Italy would inevitably lead to the end of the euro,” Italian Prime Minister Mario Monti told a Cabinet meeting, according to an e-mailed statement.

 European governments may ease provisions in a planned permanent rescue fund requiring bondholders to share losses in sovereign bailouts, German Finance Minister Wolfgang Schaeuble suggested. Schaeuble signaled that Germany may retreat from demands that private creditors contribute to rescues in exchange for European treaty amendments toughening rules on budget oversight. The S&P 500 Financials Index rose 0.4 percent today and has tumbled 13 percent in November to lead the S&P 500’s 7.6 percent slide.

 U.S. financial shares “had been knocked down dramatically and there’s a better tone today,” Richard Sichel, who oversees $1.6 billion as chief investment officer at Philadelphia Trust Co., said in a telephone interview. “We have to hope they can get their act together in Europe and we go back to concentrating on what we’re doing here.” Treasuries fell on speculation investors seeking refuge from volatility in the European sovereign-debt markets may have pushed U.S. government yields too low. The 10-year note’s yield rose eight basis points to 1.97 percent. The rate is up from a record low of 1.67 percent on Sept. 23.

 The dollar increased against 15 of 16 major peers, surging 1.2 percent against the Swiss franc and at least 1 percent against the Norwegian krone and Swedish krona. The euro weakened against 12 of 16 major peers. Silver and gasoline lost at least 1.9 percent to lead declines in 19 of 24 commodities tracked by the S&P GSCI. Crude oil 1.2 percent to $97.36 a barrel as of 1:44 p.m. in New York.

  Have a Wonderful Weekend Everyone!

As Always,

 Kyle, for Carolann.

 

Dear Friends,

Tangents:

I read an interesting story on The Dead Sea Scrolls today; it was part of a story on the current exhibit of the Scrolls at Discovery Times Square Museum in New York, which opened October 28^th and will run to April 15^th, 2012.  These ancient scraps of animal skin or papyrus are over 2000 years old and are written in Hebrew, Aramaic and Greek , with texts sacred to all three Abrahamic religions – Judaism, Christianity and Islam, and so, of course, they inspire many.   More than 60 years after the first of them were discovered in caves at Qumran, in the West Bank about 13 miles east of Jerusalem, they have recently begun the second phase of their modern existence, thanks to technology.  This is due to the fact that in September, the Israel Museum, with the help of Google, began putting its Dead Sea Scroll collection online, where it can now be examined at leisure and in great detail by everyone. The Israel Antiquities Authority (IAA), with its own large collection of scrolls, is expected to follow suit in December.  Both efforts are intended to open the scrolls to “crowd sourcing,” where new insights might come from anyone who studies them online, thereby aiding the work of scholars.  Isn’t that amazing?  The Israel Museum’s Dead Sea Scrolls are viewable online at : dss.collections.imj.org.il/.  

My mother phoned this morning and she was reminiscing about this day, November 22^nd, in 1963 when J.F. Kennedy was assassinated.  She loved JFK, as so many did.  I am exactly the same age as Caroline Kennedy, so what I remember is being sent home from school in the middle of the day, and taking a short-cut through the woods with my sister, in order to get home quickly.  It was a cold November day in Montreal and there was so much snow; when we arrived home, we found my mother seated, watching, she had moved the television set into the kitchen so she wouldn’t miss anything… 

Photos of the day 

November 22, 2011

 Swans sit in a boat during the annual collection of Hamburg’s famous ‘Alster Swans’ in Hamburg, Germany. Every year the swans are collected from waterways around the northern German city of Hamburg and taken to winter quarters where they are fed and cared for until the spring. Fabian Bimmer/Reuters.

Market Commentary:

Canada

By Kaitlyn Kiernan

Nov. 22 (Bloomberg) — Canadian stocks rose for the first time in five days as gold shares surged after debt concerns in the U.S. and Europe spurred demand for the metal as a protection of wealth.

Barrick Gold Corp., the largest producer of the precious metal, gained 2.2 percent. Royal Bank of Canada, the nation’s biggest lender, rose 1.1 percent after the Federal Reserve said it discussed monetary easing at its last meeting. Suncor Energy Inc., Canada’s biggest oil and gas producer, dropped 1.7 percent on concern slower growth will hurt fuel demand.

The Standard & Poor’s/TSX Composite Index rose 10.47 points, or 0.1 percent, the most since Nov. 11, to 11,795.19.

“I would call this a directionless market,” Todd Johnson, a money manager at BCV Asset Management in Winnipeg, Manitoba, said in a telephone interview. The firm oversees about C$300 million ($289.6 million). “There are just a lot of uncertainties and unknowns. The politicians in Washington have large difficulty ahead of them and the budget problems will be with us for awhile, while Europe continues to relatively do nothing while bond yields rise.”

The S&P/TSX erased 3.6 percent from Nov. 15 through yesterday as the index had its longest streak of losses since June 8. The benchmark index of Canadian stocks has slipped 12 percent this year and is set to underperform the S&P 500 for the first year since 2003. The Standard & Poor’s 500 Index, the U.S. equity benchmark, has dropped 5.5 percent this year.

Spain’s three-month borrowing costs more than doubled at an auction today, sending two-year yields toward the highest level since 2003, while Belgium’s 10-year bond yields rose to more than 5 percent, adding to concern the euro crisis is spreading. Concern that leaders are running out of options to solve the crisis sent French and Italian yields higher.

U.S. gross domestic product climbed at a less-than-forecast 2 percent annual rate from July through September, down from a previous estimate of 2.5 percent, revised Commerce Department figures showed today in Washington.

Gold rebounded from the lowest in almost four weeks after mounting debt woes in the U.S. and Europe increased demand for gold as a safe haven.

Goldcorp Inc., the world’s second-largest producer of the metal by market value, gained 1.9 percent to C$52.41. Barrick climbed 2.2 percent to C$50.98. Kinross Gold Corp., Canada’s third-largest company in the industry by market value, climbed 5.8 percent to C$13.61.                        

An index of banks in the S&P/TSX gained 0.3 percent after the Federal Reserve released minutes from their Nov. 1-2 meeting that showed some policy makers said the central bank should consider further economic stimulus.

Royal Bank of Canada rose 1.1 percent to C$44.93. Bank of Nova Scotia, the third-biggest lender, gained 0.3 percent to C$49.94.

Canadian energy companies fell as slowing U.S. economic growth and the European debt crisis increased concern that demand for fuel would slump, while a strengthening Canadian dollar threatened to crimp profits. The Canadian currency rose after a report showed retail sales in the country grew at the fastest pace in a year in September.                      

Suncor slipped 1.7 percent to C$30.42. Canadian Natural Resources Ltd., the country’s second-largest energy company by market value, dropped 1 percent to C$36.10. Enbridge Inc., Canada’s biggest pipeline company, lost 1.3 percent to C$35.76.

Smartphone maker Research In Motion Ltd., which gets 39 percent of its revenue from the U.S., slid 2.9 percent to C$17.51. The shares had fallen 3.8 percent yesterday after two analysts cut profit estimates and the company reported a glitch that caused some customers to be unable to turn on their BlackBerry Bold devices.

Consumer staples companies also slipped as Saputo Inc. fell 3 percent to C$38.92. Canada’s largest food producer was cut to “market perform” from “outperform” at Bank of Montreal, which cited a 12-month price estimate of C$45 a share.

Shoppers Drug Mart Corp., Canada’s largest drug store chain, slipped 1 percent to C$41.78. Metro Inc., a Montreal- based grocery chain, erased 0.9 percent to C$50.15.

US

By Rita Nazareth

Nov. 22 (Bloomberg) — U.S. stocks fell, driving the Standard & Poor’s 500 Index to its longest slump in almost four months, as slower-than-estimated economic growth overshadowed signs the Federal Reserve may provide more stimulus.

Alcoa Inc. and Bank of America Corp. slid at least 2.1 percent to pace losses in the Dow Jones Industrial Average. The Dow Jones Transportation Average slumped 1.1 percent. Campbell Soup Co. decreased 5.3 percent as the world’s largest soup maker’s sales trailed projections. Netflix Inc., the video- streaming and DVD subscription service, sank 5.4 percent after agreeing to sell $400 million in stock and convertible notes.

The S&P 500 declined 0.4 percent to 1,188.04 at 4 p.m. New York time. The gauge lost 5.6 percent in five days. The Dow retreated 53.59 points, or 0.5 percent, to 11,493.72 today.

“Economic growth remains slow,” John Carey, a Boston- based money manager at Pioneer Investments, said in a telephone interview. The firm oversees about $220 billion. “The evidence is not there that the actions of the Fed and the fiscal stimuli have really helped much. Investors remain concerned about Europe. People are getting concerned as they look into next year and wonder what happens to Europe and what happens here.”

Stocks fell as revised Commerce Department figures showed that gross domestic product climbed at a 2 percent annual rate from July through September, less than projected and down from a 2.5 percent prior estimate. Equities briefly turned higher as some Fed officials said the central bank should consider easing policy further, according to minutes of their Nov. 1-2 meeting.

Benchmark gauges also rose earlier today after the International Monetary Fund revamped its credit-line program to encourage countries facing outside shocks to turn to the fund with few conditions attached, as European leaders fail to end their debt turmoil. Michael Meister, finance spokesman for German Chancellor Angela Merkel’s Christian Democratic party, said “we haven’t any new bazooka to pull out of the bag.”

“The IMF has realized there’s an unresolved issue and they are trying to do what they can to keep this from reaching a liquidity crisis,” Peter Sorrentino, a senior fund manager at Huntington Asset Advisors in Cincinnati, which oversees $14.5 billion of assets, said in a telephone interview.

The Morgan Stanley Cyclical Index dropped 0.8 percent amid concern about economic growth. The KBW Bank Index retreated 1.3 percent. Bank of America lost 2.2 percent to $5.37. Alcoa declined 2.2 percent to $9.26.

Campbell Soup lost 5.3 percent to $31.84. The company reported fiscal first-quarter sales of $2.16 billion, trailing the average analyst estimate by 2.4 percent, according to Bloomberg data.                         

Netflix sank 5.4 percent to $70.45. Technology Crossover Ventures will purchase $200 million in zero-coupon senior convertible notes due 2018, and T. Rowe Price Associates Inc. funds will buy $200 million in stock. The transactions suggest Netflix’s cash squeeze may last longer than it had anticipated, said Michael Pachter, an analyst with Wedbush Securities. The company needs to spend more to make its streaming content stand out against a growing list of competitors, he said.

Hewlett-Packard Co. slipped 0.8 percent to $26.65 after losing as much as 6 percent following profit forecasts that missed analysts’ estimates. Meg Whitman, who took over as chief executive officer two months ago, used her first earnings conference call to tell investors they need to lower their expectations. The first-quarter profit forecast and full-year earnings outlook both missed estimates — a sign the company is still reeling from a technology-spending slump.

 The recent retreat in U.S. stocks, led by banks and brokerages, is signaling more losses through the end of the year, a period in which the S&P 500 usually performs best, according to Bank of America Corp.

Financial shares have posted the worst return this month among the S&P 500’s 10 industries, dropping 9.9 percent through yesterday. The weakness in the group and the benchmark gauge’s decline below 1,200 suggested the index is at risk of sinking to this year’s intraday low of 1,074.77, said Mary Ann Bartels, Bank of America’s head of U.S. technical and market analysis.

“A seasonal year-end rally will likely turn into a Christmas Bah, Humbug,” Bartels wrote in a note to clients yesterday. She sees a 50 percent chance of “a European meltdown” that would send the S&P 500 to as low as 935.

Have a wonderful evening everyone.

Be magnificent!

I often ask myself at what point can a man and a beast that cannot talk recognize each other.

From the early paradise, at the dawn of creation, runs the path where their hearts meet.

Although their connection has long been forgotten,

traces of their continuing association has not been erased.

And, suddenly, in a wordless harmony,

a dim memory awakens and the beast looks on the face of the man with tender trust

and the man casts his eyes upon the beast with an amused tenderness.

It is as if two friends, both wearing masks, meet

and vaguely recognize each other through their disguises.

 

-Rabindranath Tagore, 1861-1901

As ever,

Carolann

The most positive men are

the most credulous.

  -Alexander Pope, 1688-1744

 

 

Dear Friends,

Tangents:

Notable:  November 21^st, 1783 ~ Man’s first flight in a balloon.

Just back from Vancouver and got to see the Occupy Vancouver sight in front of the Art Gallery dismantling with one of my clients who drove me back to Harbor Air after our meeting.  No comment.

Gary came in from Toronto yesterday afternoon from an oncology meeting he attended the past couple of days.  We went to see Gordon Lightfoot last night at the Vancouver Center.…great poet, lyricist, artist, musician….but might be time to forget the live performances we thought.  However, it was the first night of his tour, so he deserves the benefit of the doubt;  maybe he’ll be more into it as the tour progresses. 

Before the show, we checked out the new restaurant l’Abbatoir which has been getting some positive traction in the past year.  Innovative for sure; pretty good food.  Worth a visit. 

Market Commentary:

Canada

By Kaitlyn Kiernan

Nov. 21 (Bloomberg) — Canadian stocks dropped for a fourth day, led by technology and energy companies, as U.S. lawmakers failed to agree on budget cuts and Moody’s Investors Service warned of France’s fiscal challenges.

 Suncor Energy Inc., Canada’s biggest oil and gas producer, lost 1.8 percent as crude oil fell to a one-week low amid European recession concerns. Teck Resources Ltd., Canada’s largest base-metals producer, dropped 1.3 percent as copper and gold fell. Research In Motion Ltd. retreated 3.8 percent after saying some customers couldn’t turn on the company’s BlackBerry Bold devices because of a glitch.

The Standard & Poor’s/TSX Composite Index fell 107.72 points, or 0.9 percent, to 11,784.72.

“It’s ugly,” said Brendan Caldwell, chief executive officer of Caldwell Investment Management Ltd. in Toronto, which manages C$1 billion ($962 million). “The markets are suffering from uncertainty fatigue,” Caldwell said in a telephone interview. “The markets would very much like to move on away from the machinations of politicians. We invest in companies, not politicians. The businesses themselves are doing quite well, but the political backdrop is completely chaotic.”

The S&P/TSX dropped 3.1 percent last week, its third straight weekly loss, as Italian, Spanish and French bond yields increased, adding to concern the European debt crisis will continue to spread. The benchmark index of Canadian stocks extended its decline to 2.9 percent this month through Nov. 18 after advancing 5.4 percent in October to end a 7-month slump.

The index is heading for its first yearly decrease since 2008 and second in the past nine years.                       

 The U.S. deficit-cutting congressional supercommittee will probably announce that it has failed to agree on $1.2 trillion of federal budget savings for today’s deadline, a Democratic aide said in an e-mail. France’s rising financing costs are increasing the nation’s fiscal challenges, according to a report issued by Moody’s Investors Service today.

The S&P/TSX Information Technology Index fell the most of 10 industry groups as Research In Motion slipped. The BlackBerry maker erased 3.8 percent to C$18.04 after reporting the Bold glitch.

JMP Securities LLC cut the Waterloo, Ontario-based company to “underperform” from “market perform,” saying low-priced smartphones are “increasingly threatening.” Mike Abramsky, an analyst at RBC Capital Markets in Toronto, lowered his price estimate on the stock to $23 from $29 because of slower sales and lower earnings projections.

Celestica Inc., which makes electronics for companies including Research In Motion, slipped 2.8 percent to C$8.25.

Raw material companies retreated after gold fell to the lowest level in three weeks as a stronger dollar curbed demand for the metal as an alternative investment.

Goldcorp Inc., the world’s second-largest producer of the metal by market value, slipped 0.8 percent to C$51.46. Barrick Gold Corp., the world’s largest producer, decreased 0.6 percent to C$49.87. Kinross Gold Corp., Canada’s third-largest company in the industry market value, declined 2.3 percent to C$12.87.

Teck Resources erased 1.3 percent to C$34.69 as copper fell to a four-week low. First Quantum Minerals Ltd., Canada’s second-largest publicly traded copper producer, slumped 1.7 percent to C$17.69.

Ivanhoe Mines Ltd., Rio Tinto Group’s partner in the Oyu Tolgoi copper and gold project in Mongolia, decreased 1.5 percent to C$19.31.                     

The S&P/TSX Energy Index lost 1.4 percent as crude oil fell.  Suncor decreased 1.8 percent to C$30.94. Canadian Natural Resources Ltd., the country’s second-largest energy company by market value, dropped 1.6 percent to C$36.48. Financial stocks fell along with U.S. and European banks.

Manulife Financial Corp., North America’s fourth-biggest insurer, lost 1.2 percent to C$11.20. Bank of Montreal, Canada’s fourth-biggest bank, fell 1.5 percent to C$56.18.

SXC Health Solutions Corp. rose 4.5 percent to C$56.90. The pharmacy benefits manager was raised to “outperform” from “neutral” at Cowen & Co., which cited “strong fundamentals and growth opportunities ahead.”

Valeant Pharmaceuticals International Inc., the country’s largest drugmaker, rose 0.6 percent to C$44.02. The Mississauga, Ontario-based company agreed to buy iNova Pharmaceuticals (Australia) Pty. for as much as A$700 million ($698 million), gaining the Duro-Tuss and Difflam cold remedies and broader access to markets in the Southern Hemisphere.

US

By Rita Nazareth

Nov. 21 (Bloomberg) — U.S. stocks slumped, giving the Standard & Poor’s 500 Index its longest decline since September, amid concern the U.S. government will be forced to submit to $1.2 trillion in automatic spending cuts.

All 10 industries in the benchmark measure declined as 468 out of 500 companies retreated. Bank of America Corp. tumbled 5 percent to pace losses in financial shares. Hewlett-Packard Co. and Caterpillar Inc. dropped at least 2.9 percent. The Dow Jones Transportation Average slid 2.3 percent. Gilead Sciences Inc. plunged 9.1 percent after agreeing to buy Pharmasset Inc. for about $11 billion in cash. Pharmasset soared 85 percent.

The S&P 500 fell 1.9 percent to 1,192.98 at 4 p.m. New York time. The benchmark gauge for American equities has lost 5.2 percent in four days. The Dow Jones Industrial Average declined 248.85 points, or 2.1 percent, to 11,547.31 today. The supercommittee created to cut the deficit said after the close of U.S. exchanges that it failed to reach a deal.

“The supercommittee was expected to pave the way to extend the stimulus that is in the system,” Barry Knapp, the New York- based head of U.S. equity strategy at Barclays Plc, said in a telephone interview. If stimulus is not extended, “you get a big hit to the economy in the first quarter right at the point when the economic fallout from the European debt crisis is hitting,” he said.

The decline pushed the S&P 500 below levels representing the top of a price range that prevailed in the two months after the U.S. was stripped of its AAA credit rating by S&P on Aug. 5.

Rallies after the downgrade brought the S&P 500 to closing highs of 1,204.49 on Aug. 15, 1,218.89 on Aug. 31 and 1,216.01 on Sept. 16, according to data compiled by Bloomberg.

The S&P 500 may fall to 1,100 if the supercommittee fails to reach an agreement, according to Goldman Sachs Group Inc.’s David Kostin. The strategist said in a note dated Nov. 18 that lawmakers’ failure to agree on at least the minimum required savings would demonstrate “the inability of elected officials to act in the long-term best interests of all Americans.”

U.S. shares joined European equities in retreating. The Stoxx Europe 600 Index declined 3.2 percent, the most since Nov. 1.  France’s rising financing costs are increasing the nation’s fiscal challenges, according to report issued by Moody’s Investors Service. Germany’s Finance Ministry said the country’s expansion is “noticeably slower” this quarter.

“The selloff in risk assets reflects concerns about the inability of policy makers to catch up with unsettling economic and financial realities, particularly in Europe and America,”

Mohamed A. El-Erian, the chief executive officer at Pacific Investment Management Co. in Newport Beach, California, said in an e-mail. His firm runs the biggest bond fund.

Stocks slumped last week as higher government bond yields in Spain, France and Italy spurred concern the European debt crisis is intensifying outside Greece. Financial stocks in the S&P 500 lost 5.6 percent last week, the biggest drop among 10 industries, after Fitch Ratings said further contagion from Europe’s debt turmoil would be a risk for U.S. banks.

Financial, industrial and technology shares had the biggest losses in the S&P 500 among 10 groups today, slumping at least 1.9 percent. The Morgan Stanley Cyclical Index slid 2.4 percent on concern about economic growth. Bank of America sank 5 percent to $5.49. Caterpillar dropped 3 percent to $91.12. Hewlett- Packard fell 4 percent to $26.86.

Gilead Sciences tumbled 9.1 percent to $36.26, while Pharmasset soared 85 percent to $134.14. Gilead agreed to buy Pharmasset, betting that its experimental hepatitis C treatments will lead the next generation of therapies in a market that may reach $20 billion by 2020.

Jefferies Group Inc. rose 0.4 percent to $10.20, after losing 9.5 percent last week. The investment bank whose stock dropped in the wake of MF Global Holdings Ltd.’s bankruptcy, cut stakes in European debt again to fend off speculation about its financial strength.

Focus Media Holding Ltd. plummeted 39 percent to $15.43 after Muddy Waters LLC, the short-selling firm known for prompting Sino-Forest Corp.’s retreat, recommended betting against the digital advertising company.

Muddy Waters spurred a 74 percent drop in Sino-Forest between June and August after saying the timber owner overstated the value of its assets. Today’s report said Focus Media has fewer television screens in its ad network than it says and may have overpaid for takeovers to mask losses.                       

Barton Biggs, the hedge fund manager who reduced U.S. equity investments in September before the biggest monthly rally since 1991, cut bullish bets again on concern the odds of a U.S. recession have increased.

The Traxis Global Equity Macro Fund’s net long position has been lowered to less than 40 percent, and may be reduced another 15 percentage points, Biggs said during an interview on Bloomberg Television “In the Loop” with Betty Liu today.

“It’s a much more bearish environment than I anticipated,” he said. “We are going to have a decline at least back to the lows of last summer. God forbid, maybe even testing the lows of 2008 and 2009.” testing the lows of 2008 and 2009.’’

The money manager’s optimism on U.S. stocks has gyrated along with the market. He raised the Traxis Global fund’s long equity position to 65 percent after slashing it to 40 percent in September, he said in an Oct. 17 interview. Biggs then boosted the figure to 80 percent, he said two weeks later.

Have a wonderful evening everyone.

Be magnificent!

The autumn comes, a maiden fair

In slenderness and grace,

With nodding rice-stems in her hair

And lilies in her face.

In flowers of grasses she is clad;

And as she moves along,

birds greet her with their cooing glad

Like bracelets’ tinkling song.

 

-Kalidasa, 450-600 AD?

As ever,

Carolann

What loneliness is more lonely

than distrust?

   -George Eliot, 1819-1880

 

Dear Friends,

Tangents:

 

-from The Book of Days,

 

John Donne, November 19^th, 1627:

Angels are creatures that have not so much of a body as flesh is, as froth is, as a vapour is, as a sigh is; and yet with a touch they shall moulder a rock into less atoms than the sand that it stands upon, and a millstone into smaller flour than it grinds.  They are creatures made – yet not a minute older now than when they were first made, if they were made before all measure of time began.  Nor, if they were made in the beginning of time and be now six thousand years old, have they one wrinkle of age in their face or one sob of weariness in their lungs.  They are God’s eldest sons.  They are super-elementary meteors.  They hang between the nature of God and the nature of man and are of middle condition.  And (if we may without offence express it so) they are the riddles of Heaven and the perplexities of speculation.

P.S. I believe in angels.

Photos of the day

November 18, 2011

A woman carries a bag as she harvests chrysanthemum at a field in a flower plantation in Tongxiang, Zhejiang province, China. Reuters.

Market Commentary:

Canada

By Matt Walcoff

Nov. 18 (Bloomberg) — Canadian stocks fell, completing a third straight weekly decline, as gold producers dropped after the U.S. Dollar Index erased most of the day’s loss.

Barrick Gold Corp., the world’s largest gold producer, decreased 1 percent as the metal finished its biggest weekly slump since Sept. 23. TransCanada Corp., the owner of the country’s largest pipeline system, advanced 2.4 percent after Chief Executive Officer Russ Girling said it will fund a rerouted Keystone XL pipeline without issuing more debt.

The Standard & Poor’s/TSX Composite Index slipped 22.99 points, or 0.2 percent, to 11,892.44, extending its weekly decline to 3.1 percent.

“We are caught in this purgatory; the market doesn’t know what it wants to do,” Greg Taylor, a money manager at Aurion Capital Management in Toronto, said in a telephone interview. The firm oversees about C$5 billion ($4.9 billion). “The fears of Europe have compressed valuations on every stock out there.”

The index dropped the most since Sept. 23 this week as bond yields increased in Italy, Spain and France, indicating concern the European debt crisis’s spread will continue. Raw-materials companies led the retreat as the U.S. dollar climbed against 15 of 16 other major currencies.

Gold erased most of its gains today, after advancing as much as 1.1 percent on the Comex in New York, as the U.S. Dollar Index pared its loss to 0.3 percent, after falling as much as 1 percent. Barrick slipped 1 percent to C$50.17. Eldorado Gold Corp., Canada’s fifth-largest gold producer by market value, retreated 2.1 percent to C$17.62.                        

Great Basin Gold Ltd., which mines in Nevada, slumped 6.9 percent to C$1.22, the lowest since March 2009. Leon Esterhuizen, an analyst at Royal Bank of Canada, cut his rating on the shares to “sector perform” from “outperform.”

 Pipeline companies in the S&P/TSX rose for a fourth day. Enbridge Inc., Canada’s biggest pipeline company, rose 0.7 percent to a record C$36.19, advancing for a third day after saying it will buy a stake in the Seaway pipeline system. At least four analysts boosted their 12-month price estimates on the shares yesterday.

TransCanada gained 2.4 percent to C$41.57. The company fell to its lowest market value relative to Enbridge’s since 2000 yesterday after the U.S. State Department delayed approval of the proposed Keystone XL line due to environmental concerns.                         

Neo Material Technologies Inc. surged 10 percent to C$7.83.

The rare earths and zirconium products maker may have jumped because Mark Smith, chief executive officer of Molycorp Inc., said he may buy a company in that industry, Matthew Gowing, an analyst at Mackie Research Capital Corp., said in a telephone interview. Molycorp is considering companies listed on the TSX, Smith said.

Canadian National Railway Co., the country’s largest railroad, advanced for the first time this week, increasing 1.6 percent to C$80.02 as crude oil fell to a seven-day low.

The S&P/TSX Commercial Banks Index climbed after closing at the lowest relative to earnings since March 2009 yesterday.

Royal Bank of Canada, the country’s largest lender by assets, rose 1.1 percent to C$44.42. Bank of Nova Scotia, the third- biggest bank, gained 1.2 percent to C$49.89.

US

By Rita Nazareth

Nov. 18 (Bloomberg) — U.S. stocks fell, with the Standard & Poor’s 500 Index completing its biggest weekly drop in two months, as technology and energy losses overshadowed optimism that the economy is accelerating.

The S&P 500 fell less than 0.1 percent to 1,215.66 at 4 p.m. New York time after rising 0.6 percent earlier, according to preliminary closing data. It retreated 3.8 percent this week. The Dow Jones Industrial Average increased 25.50 points, or 0.2 percent, to 11,796.23.

“The next big catalyst for the stock market will probably be a growing appreciation that not only is the U.S. economy not recessing, but U.S. economic growth is actually accelerating,” James Paulsen, who helps oversee about $333 billion as chief investment strategist at Minneapolis-based Wells Capital Management, said in an e-mail.

The S&P 500 swung between gains and losses as investors watched developments in Europe. The Conference Board’s index of U.S. leading indicators rose more than forecast in October, signaling the largest economy will keep growing in 2012. The U.S. economy may end 2011 expanding at its fastest pace in 18 months as analysts increase their forecasts for the fourth quarter.

Economists at JPMorgan Chase & Co. in New York now see gross domestic product rising 3 percent in the final quarter, up from a previous prediction of 2.5 percent. Macroeconomic Advisers in St. Louis increased its forecast to 3.2 percent from 2.9 percent at the start of November, while Morgan Stanley boosted its outlook to 3.5 percent from 3 percent.

Stocks erased gains earlier today as Deutsche Presse- Agentur reported that Germany’s Foreign Ministry said the nation was considering the possibility of “orderly defaults” beyond Greece. The euro snapped a four-day slump as European Central Bank purchases pushed down Italian and Spanish bond yields and speculation grew that the International Monetary Fund may play a larger role in fighting the debt crisis.

“Until we have some sense of stability in Europe, the volatility will continue,” Mark Bronzo, who helps manage $24 billion at Security Global Investors in Irvington, New York, said in an e-mail. “Better economic growth in the U.S. will provide support for the markets and potentially set the stage for a nice rally if and when Europe does stabilize.”

Have a wonderful weekend everyone.

Be magnificent!

How can you regard yourself as subject and other beings as objects,

when you know that all are one.

 

Brihadaranyaka Upanishad

As ever,

Carolann

Each time someone stands up for an ideal,

or acts to improve the lot of others or

strikes out against injustice, he sends

forth a tiny ripple of hope.

     -Robert F. Kennedy, 1925-1968

 

 

Dear Friends,

Tangents:

 

NATURE POETRY

Concrete, glass, steel –

Meaning limestone, silica, gypsum, sand,

Manganese, sodium, sulfur, ore –

Anything unnatural here?

              -Meg Kearney

 

Photo of the day 

November 17, 2011

Denis Sinyakov/Reuters

Market Commentary:

Canada

By Matt Walcoff

Nov. 17 (Bloomberg) — Canadian stocks fell to a four-week low, led by raw-materials companies, as oil, metals and world equities declined on concern that the European debt crisis will curb growth.

Barrick Gold Corp., the world’s largest gold producer, decreased 3.8 percent after futures dropped the most in seven weeks as investors sold precious metals to cover losses in other assets. Agrium Inc., a farm retailer and fertilizer producer, tumbled 6.5 percent as corn and wheat retreated. Royal Bank of Canada, the country’s biggest lender by assets, dropped 2.6 percent as Spanish bond yields surged to a euro-era high.

 The Standard & Poor’s/TSX Composite Index fell 258.93 points, or 2.1 percent, to 11,915.43, the lowest level since Oct. 20. “Two real countries are in the midst of a massive funding crisis,” Keith McLean, a managing partner at GMP Investment Management in Toronto, said in a telephone interview, referring to Italy and Spain. McLean oversees about C$200 million ($195 million). “Everyone knows the exit price for gold, oil, copper, everything is higher. But if we go into an ‘08 scenario, those prices go a lot lower before they go a lot higher, even gold.’’

The S&P/TSX has dropped 11 percent this year as stocks in the index’s three biggest industries –finance, energy and raw materials — have declined. Equities most-closely tied to the economy had retreated in part on concern the European crisis will lead to sovereign-debt defaults or a recession.                          

Spanish bond yields rose today as the country’s Treasury failed to meet its maximum target of 4 billion euros ($5.4 billion) of notes in a sale. The Madrid-based Treasury sold 3.56 billion euros in bonds at an average yield of 6.975 percent.

The European Financial Stability Facility has no plans for financial assistance for Italy, Reuters quoted an unnamed euro- zone official as saying today. Italian bonds yields also rose this month to highest level since the introduction of the euro.

Precious-metals companies in the S&P/TSX fell today as gold dropped and silver declined the most since Sept. 23 on the Comex in New York.

Barrick lost 3.8 percent to C$50.66. Goldcorp Inc., the world’s second-largest gold producer by market value, slipped 1.9 percent to C$52.51. Silver Wheaton Corp., Canada’s fourth- biggest precious-metals company by market value, decreased 6.5 percent to C$33.19.

Avion Gold Corp., which mines in Africa, slumped 11 percent to C$1.64. The shares have plunged 25 percent since the company cut its 2011 production forecast on Nov. 15.                         

Corn futures retreated the most since Sept. 30 after the U.S. Agriculture Department said exports of the crop fell to the lowest since June 2004 last week. Profercy, a Leamington Spa, England-based firm that provides research on the fertilizer industry, said natural gas prices will fall in Ukraine, which would reduce a cost advantage for North American producers of nitrogen-based fertilizers.

Agrium dropped 6.5 percent, the most since October 2009, to C$72.26. Potash Corp. of Saskatchewan Inc., the world’s largest fertilizer producer by market value, declined 4.3 percent to C$44.11 for a fourth-straight loss.

The S&P/TSX Commercial Banks Index closed at the lowest level since February 2010. Royal Bank decreased 2.6 percent to C$43.95, the lowest price since May 2009. Bank of Nova Scotia, Canada’s third-largest lender by assets, retreated 3.2 percent to C$49.32. Manulife Financial Corp., North America’s fourth- biggest insurer, fell 2.6 percent to C$11.49.                        

Energy stocks declined as crude oil erased yesterday’s 3.2 percent gain, dropping under $99 a barrel. Canadian Natural Resources Ltd., the country’s second-largest energy company by market value, lost 3.9 percent to C$37.19. Suncor Energy Inc., Canada’s biggest oil and gas producer, slipped 2.8 percent to C$31.82. Precision Drilling Corp., Canada’s largest contract driller, slumped 6.8 percent to C$11.45.

Iberian Minerals Corp., a base-metals producer with operations in Spain and Peru, soared 38 percent, the most since July 2003, to C$1.09 after agreeing to be bought by Trafigura Beheer BV. The Amsterdam-based oil and metals trading company said it would pay C$1.10 a share for the 52 percent of Iberian it doesn’t already own.

Pharmacy-benefits manager SXC Health Solutions Corp. climbed 7.6 percent to C$54.40 after saying it will buy Greenwood Village, Colorado-based peer HealthTrans LLC. SXC will pay $250 million for HealthTrans, which has about $270 million in annual revenue, SXC said in a statement.

US

By Rita Nazareth

Nov. 17 (Bloomberg) — U.S. stocks fell, sending the Standard & Poor’s 500 Index to the lowest level in a month, as concern grew that Europe’s debt crisis will worsen and lawmakers will fail to agree on plans to cut the American deficit.

Commodity and technology shares had the biggest declines among 10 groups in the S&P 500, falling at least 2.1 percent.

Sears Holdings Corp. slid 4.6 percent as the retailer reported a steeper loss. Applied Materials Inc., a producer of chipmaking equipment, sank 7.5 percent as forecasts trailed estimates. Jefferies Group Inc. retreated 2 percent and dropped below $10 intraday for the first time since March 2009.

 The S&P 500 lost 1.7 percent to 1,216.13 at 4 p.m. in New York. Losses accelerated after it fell below 1,229.10, its closing level on Nov. 9 after sinking 3.7 percent. The gauge dropped below its 100-day average. The Dow Jones Industrial Average sank 134.86 points, or 1.1 percent, to 11,770.73.

“It’s a risk-off day,” Michael Shaoul, chairman of Marketfield Asset Management in New York, which oversees $1 billion, said in a telephone interview. “There’s a lot of liquidation in the commodity space. You have the obvious story of European yields. The supercommittee may disappoint, but I don’t think this is going to be a main driving force behind this market. There’s too much stuff going on.”

Stocks fell as Reuters reported a euro-area official as saying there are no aid plans for Italy from the European Financial Stability Facility. Spanish bonds sank, driving 10- year yields to the highest since the euro was introduced, as borrowing costs climbed at an auction. Republicans and Democrats on Congress’s supercommittee hardened their positions with less than a week until the deadline to propose deficit cuts.                      

Today’s decline sent the benchmark measure of American equities below its average price of the past 100 days of 1,226, which could be a harbinger of more losses, according to Ryan Detrick, at Schaeffer’s Investment Research.

 “It’s a bad sign for the bulls,” Detrick, the senior technical strategist at Schaeffer’s, said in a telephone interview from Cincinnati. “It’s a sign that the bears are once again trying to take charge and push things lower here. It’s a little discouraging when the market shrugs off good economic news and focus on other things.”

Earlier today, economic reports helped push stocks higher. The fewest Americans in seven months filed for unemployment benefits. Builders broke ground on more homes than forecast in October and construction permits climbed to the highest level since March 2010. Another report showed that manufacturing in the Philadelphia region expanded less than forecast in November as orders and sales cooled.                    

Handheld computers used by traders on the floor of the New York Stock Exchange malfunctioned near the end of session and the closing process was extended past 4 p.m., NYSE Euronext spokesman Rich Adamonis said.

More than seven stocks fell for every two that gained on U.S. exchanges. The Chicago Board Options Exchange Volatility Index, which measures the cost of using options as insurance against declines in the S&P 500, rose 3 percent to 34.51, surging 15 percent in four days.

Concern about global growth drove down commodity shares as China’s central bank said prices haven’t stabilized enough to loosen monetary policy. The Morgan Stanley Cyclical Index slumped 2.4 percent. Alcoa Inc., the largest U.S. aluminum producer, retreated 3.5 percent to $9.62. Intel Corp., the world’s biggest chipmaker, lost 2.4 percent to $24.34.

Sears slumped 4.6 percent to $65.19. Hedge-fund manager Edward Lampert and new Chief Executive Officer Lou D’Ambrosio are emphasizing smaller stores, online commerce and licensing Sears’s brands to turn around the four-year sales slide.

Retailers are having a harder time attracting shoppers, with consumer confidence at the lowest in more than two years.

Applied Materials fell 7.5 percent to $11.53. Profit before certain costs will be 8 cents to 16 cents a share, the company said. Revenue will decline up to 15 percent from the prior quarter, Applied said, indicating sales of as little as $1.85 billion. Analysts on average predicted profit of 18 cents on sales of $2.07 billion, data compiled by Bloomberg show.

Jefferies slumped 2 percent to $10.11. Debt of the New York-based firm tumbled today to levels considered distressed.

Jefferies came under pressure from short sellers after MF Global Holdings Ltd.’s $6.3 billion bet on European debt led to an Oct. 31 bankruptcy and spurred scrutiny of similar stakes at financial firms.

 Chief Executive Officer Richard Handler said turmoil around the investment bank’s shares and publicly traded debt will ease as the fallout dissipates from the collapse of MF.

“It is not surprising that our bonds are under pressure after the assault on our company over the past two weeks,”

Handler said yesterday in an e-mail. “Some bond investors sell first and ask questions later. We expect the market to return to normal pricing once we move beyond the ripple effect of the inaccuracies others have recently disseminated and once investors digest all the information” that Jefferies disclosed.

NetApp Inc. tumbled 12 percent, the most in the S&P 500, to $35.73 The maker of data-storage products forecast third-quarter adjusted earnings of no more than 60 cents a share, 4 cents less than the average analyst estimate.

Angie’s List Inc., the consumer-review website with more than 1 million paying members, surged 25 percent to $16.26 in its trading debut after raising $114 million in an initial public offering.

Have a wonderful evening everyone.

Be magnificent!

Between me and the smallest animal,

the difference is only in manifestation,

but as a principle he is the same as I am,

he is my brother, he has the same soul as I have.

 

-Swami Vivekananda, 1863-1902

As ever,

Carolann

You don’t stop laughing because you grow

old.  You grow old because you stop

laughing.

          -Michael Pritchard, 1967- 

 

Dear Friends,

Tangents:

 

November 16^th, 1885: Louis Riel hanged, led North West Rebellion, Manitoba, Canada.

-from The Book of Days:

Emily Eden to her sister Lady Buckinghamshire, November 16^th, 1817:

 

Indeed, nobody but an excellent sister could be induced to write on such a gloomy, dispiriting afternoon, but I have put the table close by the fire, with one leg (belonging to the table, not to me) in the fender, to prevent it from slipping away, the armchair close behind the table, and me supported by them both, holding a pen in one hand and the poker in the other, and now, have at you.

Photos of the day 

November 16, 2011

A general view is seen of the Nyamulagira Volcano eruption in eastern Democratic Republic of Congo. The eruption appears to be on a lower section of the volcano, or in a separate caldera with lava flowing north into a non-populated section of the park. Kenny Katombe/Reuters.

Market Commentary:

Canada

By Matt Walcoff

Nov. 16 (Bloomberg) — Canadian stocks fell, led by raw- materials producers, after Fitch Ratings said the spread of the European debt crisis “poses a serious risk” to U.S. banks.

Teck Resources Ltd., Canada’s largest base-metals producer, fell 3.7 percent as copper futures dropped a first time in four days. Barrick Gold Corp., the world’s biggest gold-mining company, declined 1.4 percent as the U.S. dollar advanced a third day against the euro. Jaguar Mining Inc., which produces gold in Brazil, soared 46 percent after two people familiar with the matter said Shandong Gold Group Co. bid for the company.

“It’s no secret that Europe is pretty fragile,” Irwin Michael, a money manager at ABC Funds in Toronto, said in a telephone interview. The firm oversees about C$1 billion ($980 million). “The Fitch thing is adding more fuel to the fire.”

The Standard & Poor’s/TSX Composite Index slipped 54.91 points, or 0.5 percent, to 12,174.36 after advancing as much as 0.5 percent before the Fitch statement.

 The S&P/TSX has dropped 9.4 percent this year as industries most-tied to economic growth, such as base-metals mining, energy and finance, have declined. World equities have retreated in part on concern the European debt crisis will weaken the broader economy. The International Monetary Fund said in September the world economy will expand 4 percent this year and next, compared with June forecasts of 4.3 percent in 2011 and of 4.5 percent in 2012.

Stocks fell after Fitch said “the broad credit outlook for the U.S. banking industry could worsen” if the debt issue in Europe isn’t resolved soon. Earlier today, the Bank of England said failure to resolve the turmoil could lead to “significant adverse effects” on the global economy.

Base-metals and coal producers in the S&P/TSX declined to a three-week low. Teck lost 3.7 percent to C$37.45. Ivanhoe Mines Ltd., Rio Tinto Group’s partner in the Oyu Tolgoi copper and gold project in Mongolia, decreased 5.9 percent to C$21.20. Lundin Mining Corp., which operates in Europe, slumped 4.7 percent to C$3.65.

Uranium One Inc., a mining company controlled by Moscow- based ARMZ Uranium Holding, sank 5.7 percent to C$2.49 after S&P assigned the company a “BB-” credit rating, three levels below investment grade. In a statement, the ratings company cited Uranium One’s “limited operating and geographic diversification, relatively short collective mine life, limited track record, and reliance on residual cash flows from its joint venture mine operations.”                   

Precious-metals producers retreated as the U.S. dollar rose against all 16 other major currencies today as investors sought safer assets. Barrick Gold Corp., the world’s largest gold producer, slipped 1.4 percent to C$52.65. Kinross Gold Corp., Canada’s third-biggest company in the industry by market value, fell 1.5 percent to C$14.04. Minefinders Corp., a precious-metals company with operations in Mexico, plunged 11 percent, the most since December 2008, to C$12.46 after the Gold Stock Report newsletter recommended that investors sell the shares.

 Jaguar jumped 46 percent, the most since October 2003, to C$7.98 after two people familiar with the offer said Shandong, the parent of China’s second-largest gold producer by market value, bid $9.30 a share for the company. The people asked not to be identified because the information is confidential. Jaguar received “proposals over the past few weeks” and has decided to explore alternatives, the Concord, New Hampshire-based company said today in a statement.

NovaGold Resources Inc., which is developing gold and base- metals properties, surged 25 percent to C$11.25 after saying it will spin off the Ambler copper project in Alaska. The new company, NovaCopper Inc., will be led by current NovaGold Chief Executive Officer Rick Van Nieuwenhuyse, while Gregory A. Lang, president of Barrick’s North American unit, will become NovaGold’s CEO. The shares’ rally was the biggest since September 2009.

Potash Corp. of Saskatchewan Inc., the world’s largest fertilizer producer by market value, fell 1.7 percent to C$46.08. James T. Prokopanko, the chief executive officer of Plymouth, Minnesota-based peer Mosaic Co., said at an industry conference today that higher supplies of the nutrient will make prices unsustainable above $600 a ton through 2020.

West Texas Intermediate crude oil settled at a five-month high of $102.59 a barrel after Enbridge Inc. said it agreed to buy ConocoPhillips’s 50 percent interest in the Seaway pipeline system, which runs from Cushing, Oklahoma, to the Gulf Coast, for $1.15 billion. Enbridge will reverse the flow of the line, shipping oil southward. A bottleneck at the Cushing hub has helped keep WTI prices below those of Brent crude traded in London this year.

Canadian Natural Resources Ltd., the country’s second- largest energy producer by market value, rose 3.2 percent to C$38.69. Suncor Energy Inc., the country’s largest oil and gas producer, gained 1.5 percent to C$32.75. Cenovus Energy Inc., Canada’s fifth-biggest company in the industry, increased 1 percent to C$33.94.

US

By Michael P. Regan and Rita Nazareth

Nov. 16 (Bloomberg) — U.S. stocks fell, erasing yesterday’s gains in benchmark indexes, as Fitch Ratings said further contagion from Europe’s debt crisis would pose a risk to American banks. The euro weakened, while oil climbed to a five- month high above $102 a barrel.

The Standard & Poor’s 500 Index lost 1.7 percent to 1,236.91 at 4 p.m. in New York. Most stocks in the Stoxx Europe 600 Index retreated. The euro slipped 0.6 percent to $1.3460 after losing as much as 0.8 percent. Credit-default swaps insuring Italian and Spanish debt retreated from records and Italy’s 10-year yield fell as the European Central Bank bought the nations’ debt. Oil rallied as Enbridge Inc. planned to reverse the direction of a pipeline, potentially alleviating a bottleneck that had reduced prices.

Stocks slid to their lows of the session in the final minutes of trading after Fitch said that while U.S. lenders have “manageable direct exposures” to Greece, Ireland, Italy, Portugal and Spain, further turmoil in those markets poses a “serious risk.” Benchmark U.S. indexes briefly erased losses earlier as Federal Reserve Bank of Boston President Eric Rosengren said the Fed may need to coordinate with the ECB on fighting turmoil in credit markets.

“It’s fear of the unknown spooking the market,” Madelynn Matlock, who helps oversee about $14.5 billion at Huntington Asset Advisors in Cincinnati, said in a telephone interview.

“There may be more exposure to Europe out there than people really think, even if banks think they are covered,” she said. “Increasing oil prices is a concern because it’s like a tax on the consumer.”                      

Early losses in stocks came after Bank of England policy makers said that failure to resolve the European debt turmoil could lead to “significant adverse effects” on the global economy. UniCredit SpA, Italy’s largest bank, prepared to ask central-bank officials to broaden the types of assets accepted as collateral.

Gauges of financial and commodity stocks dropped more than 2 percent to lead losses in all 10 of the main industry groups in the S&P 500. JPMorgan Chase & Co., Citigroup Inc. and Goldman Sachs Group Inc. slid at least 3.8 percent.

 Fitch said its current outlook on the U.S. banking industry is stable because of improving fundamentals and ratings that are lower than before the debt crisis.

“However, risks of a negative shock are rising and could alter this outlook,” the ratings company said today in a statement. “Fitch believes that unless the Eurozone debt crisis is resolved in a timely and orderly manner, the broad credit outlook for the U.S. banking industry could worsen,”

JPMorgan and Goldman Sachs are among the world’s biggest traders of credit derivatives and have disclosed to shareholders that they have sold protection on more than $5 trillion of debt globally. Yet they are among firms that don’t provide a full picture of potential losses and gains from a default, giving only net numbers or excluding some derivatives altogether.

Rambus Inc. plunged 61 percent after it lost a $3.95 billion jury trial over allegations that Micron Technology Inc. and Hynix Semiconductor Inc. prevented its memory chips from becoming an industry standard. Abercrombie & Fitch Co. tumbled 14 percent as the retailer’s profit trailed estimates amid higher costs. Dell Inc. slipped 3.2 percent as the computer maker told investors to expect more slow sales growth for the rest of the year.                         

Stocks slid even after the Fed said industrial production in the U.S. advanced 0.7 percent in October, more than the median economist forecast and adding to evidence the world’s largest economy is weathering Europe’s crisis. Other data showed the cost of living unexpectedly fell and homebuilder sentiment improved.

The rally in oil came as Enbridge Inc. agreed to acquire ConocoPhillips’s share of the pipeline that runs between Cushing, Oklahoma, and the Gulf Coast and announced the reversal. The change may alleviate a bottleneck at the Cushing storage hub that had lowered the price of West Texas Intermediate, the grade traded in New York, versus other oils.

Oil helped lead the S&P GSCI Index up 0.9 percent even amid declines in 15 of the 24 commodities tracked by the gauge. Nickel and zinc also climbed at least 2.8 percent, while Kansas wheat, silver and natural gas lost at least 1.8 percent.

Among European stocks, Electricite de France SA slid 4.4 percent as the nation’s opposition Socialist and Green parties united to campaign for the closure of 24 nuclear reactors by 2025. Vivendi SA, the owner of the world’s largest video-game and music companies, advanced 5.6 percent after reporting profit that exceeded analysts’ estimates.

Credit-default swaps on Italy dropped 18 basis points to 576, while contracts on Spain were down 11 basis points at 470.

The yield on the 10-year Italian security declined six basis points to 7.00 percent, while the equivalent-maturity Spanish yield added eight basis points to 6.41 percent. French 10-year yields rose three basis point to 3.71 percent and the nation’s borrowing costs relative to benchmark German bunds retreated from a euro-era record.

The ECB bought larger-than-usual sizes and quantities of Italian debt, said two people with knowledge of the trades, who declined to be identified because the deals are private.

Mario Monti was sworn in as Italian prime minister and finance minister, taking over an unelected government charged with imposing austerity to prevent the euro area’s third-biggest economy from succumbing to the debt crisis. Greek Prime Minister Lucas Papademos won a confidence vote in parliament, receiving a mandate to push through budget measures necessary to secure financing designed to avert a collapse of the economy and keep Greece in the euro.

Benchmark German bunds fell, sending 10-year yields up three basis points to 1.82 percent. German Chancellor Angela Merkel said the nation is prepared to cede some national sovereignty to the European Union to achieve closer economic and political ties.

The pound slid for a third day against the dollar after a report showed U.K. unemployment rose in the three months through September as joblessness among young people climbed above 1 million for the first time since at least 1992. The jobless rate climbed to a 15-year high of 8.3 percent. The FTSE 100 Index of stocks lost 0.2 percent.

The MSCI Emerging Markets Index fell 1 percent. The Hang Seng China Enterprises Index in Hong Kong tumbled 2.9 percent, while Taiwan’s Taiex Index fell 1.4 percent. South Korea’s Kospi Index dropped 1.6 percent.

 Have a wonderful weekend everyone.

 Be magnificent!

I do not mean a universal philosophy, or a universal mythology, or a universal ritual,

but I mean that this world must go on, wheel within wheel.

What can we do?

We can make it run smoothly, we can lessen friction, we can grease the wheels, as it were.

But what?

By recognizing variation.

Just as we have recognized unity, by our very nature so we must also recognize variation.

We must learn that truth may be expressed in a thousand ways, and each one yet be true.

We must learn that the same thing can be viewed from a hundred different standpoints,

and yet be the same thing.

 

-Swami Vivekananda, 1863-1902

As ever,

Carolann

The days that are still to come

are the wisest witnesses.

   -Pindar, 522-443 BC 

 

 

Dear Friends,

Tangents:

Birthday: Georgia O’Keefe, painter, b. 1882

 

An interesting  article that I read this week:

 

Underneath Mexico City’s bustle lie Aztec wonders

Excavations in the middle of downtown Mexico City have unearthed sacred Aztec sculptures, giving archaeologists a glimpse into ancient rituals.

 

 

• Barrera heads urban archaeology program.
• Courtesy of Mexico’s National Institute of Anthropology and History

In the middle of Mexico City’s historical downtown, where the modern bustle leaves most visitors in a daze, archaeologists have unearthed something altogether more serene: a potential clue in their quest to find the long sought-after tombs of Aztec emperors.

This fall, amid ongoing excavation at the Templo Mayor site, where one of the main temples of the ancient capital, Tenochtitlan, once stood, they discovered a 500-year-old platform 45 feet in diameter and decorated with 19 sculptures of serpent heads. Tenochtitlan, built in the middle of Lake Texcoco, was the heart of Aztec civilization, whose influence spread across Mesoamerica until the 16th century.

The finding is part of a five-year effort to locate the tombs in the ancient site, which, now in the heart of Mexico’s capital, was paved over by the Spanish invaders in 1521.

Archaeology work began at the Templo Mayor in earnest after 1978, when workers from the electric company accidentally dug up a pre-Hispanic monolith 10.6 feet in diameter, which was later excavated and identified as Coyolxauhqui, the moon goddess, and dates back to the end of the 15th century.

Today, some 7,000 pieces have been uncovered. But an emperor’s tomb would be a critical find, and the ceremonial platform is an important step toward understanding the rituals of the Aztecs, says Alfonso de Maria y Campos, director general of Mexico’s National Institute of Anthropology and History. The finding is currently off limits to the public. –Sara Miller Llana.

 

Photos of the day 

November 15, 2011

A girl feeds a swan near the medieval Charles Bridge in smoggy central Prague, Czech Republic. Petr Josek/Reuters.

Market Commentary:

Canada

By Matt Walcoff

Nov. 15 (Bloomberg) — Canadian stocks rose less than 0.1 percent as base-metals producers gained after copper advanced for a third day, offsetting the effect of Europe’s debt crisis on financial stocks.

Teck Resources Ltd., Canada’s largest base-metals and coal producer, advanced 2.4 percent as copper advanced for a third day. Royal Bank of Canada, the country’s largest lender by assets, dropped 1.1 percent as bond yields increased in Italy, Spain and France. Research In Motion Ltd., the BlackBerry maker, climbed 5 percent after an analyst at Northern Securities Inc. boosted his rating on the shares.

The Standard & Poor’s/TSX Composite Index rose 5.08 points to 12,229.27 at 4 p.m. Toronto time after slipping as much as 0.6 percent earlier.

“Right now we’re in a state of suspense,” Timothy Lazaris, chief executive officer of Red Sky Capital Management Ltd. in Toronto, said in a telephone interview. The firm oversees C$55 million ($54 million). “We need better visibility about what’s about to happen in Europe.”

The index has declined 2.3 percent since Oct. 28 as financial and energy stocks retreated on concern that the European debt crisis will weaken the global economy and Manulife Financial Corp. and Sun Life Financial Inc. reported quarterly losses. The S&P/TSX is heading for its first yearly decrease since 2008 and second in the past nine years.

Base-metals producers advanced as copper gained after the U.S. reported a bigger gain in October retail sales than most economists in a Bloomberg survey had forecast. The Federal Reserve Bank of New York’s regional manufacturing index increased, contrary to most economists’ estimates.

Teck Resources Ltd., Canada’s largest company in the industry, climbed 2.4 percent to C$38.90 after Anthony Young, an analyst at Dahlman Rose & Co., began coverage of the company with a “buy” rating. Ivanhoe Mines Ltd., Rio Tinto Group’s partner in Mongolia’s Oyu Tolgoi project, rose 4.8 percent to C$22.53. First Quantum Minerals Ltd., Canada’s second-largest publicly traded copper producer, rallied 2.7 percent to C$19.05.

Gold producers gained as precious metals advanced on demand for havens from the European debt crisis. Barrick Gold Corp., the world’s largest producer of the metal, advanced 0.6 percent to C$53.42. Eldorado Gold Corp., Canada’s fifth-biggest gold producer by market value, increased 1.1 percent to C$19.55. Centerra Gold Inc., which mines in Kyrgyzstan and Mongolia, climbed 6.4 percent to C$21.31.

Avion Gold Corp., which mines in Africa, sank 13 percent, the most since August 2010, to C$1.90 after cutting its 2011 production forecast.

The cost to insure Italian, Spanish and French bonds against default rose to records today as Mario Monti, Italy’s prime minister-designate, faced resistance in his attempts to include politicians in his so-called technical Cabinet. The euro fell for a second day against the U.S. dollar.

Royal Bank dropped 1.1 percent to C$45.40. Manulife, North America’s fourth-biggest insurer, lost 1.9 percent to C$11.77. Sun Life, Canada’s third-largest insurance company, declined 1.5 percent to C$21.03 after closing at the lowest since March 2009 yesterday.

RIM advanced 5 percent to C$19.54 after Sameet Kanade, an analyst at Northern Securities, raised his rating on the shares to “speculative buy” from “sell.” In a note to clients, Kanade cited potential negative news such as a decline in subscribers has already been factored into the share price.                        

Options traders boosted bullish bets on Research In Motion’s U.S. stock to the highest since 2007, convinced the shares will rebound from a 69 percent plunge this year through yesterday that left them trading below book value. Traders are probably betting the Waterloo, Ontario-based company will receive a buyout offer, said Bahl & Gaynor Investment Counsel’s Matt McCormick.

 Auto-parts maker Martinrea International Inc. surged 8.1 percent to C$7.57 after forecasting higher profit for the year than analysts in a Bloomberg survey had estimated. The company also said it will buy back as many as 4.16 million shares.

Westport Innovations Inc., a developer of technology for natural-gas engines, jumped 8.7 percent to C$31.76 after three U.S. senators introduced a bill to provide tax credits for vehicles that run on the fuel.

Imris Inc., which develops medical-imaging technology, tumbled 17 percent, the since February 2009, to C$2.70 after saying it had a loss of 19 Canadian cents a share in the third quarter. Analysts had estimated a loss of 5 Canadian cents a share, excluding certain items, according to the average forecast in a Bloomberg survey.

US

By Rita Nazareth

Nov. 15 (Bloomberg) — U.S. stocks rose, rebounding from earlier losses, on speculation Italian Prime Minister designate Mario Monti will succeed in forming a new government to battle the debt crisis and after growth in retail sales beat estimates.

Technology and industrial shares had the biggest gains among 10 groups in the Standard & Poor’s 500 Index, rising at least 0.5 percent. Intel Corp. spurred a rally in semiconductor companies, climbing 2.9 percent, after Warren Buffett’s Berkshire Hathaway Inc. said it invested in the world’s largest chipmaker. Wal-Mart Stores Inc. slumped 2.4 percent as profit at the world’s biggest retailer trailed analysts’ forecasts.

The S&P 500 gained 0.5 percent to 1,257.81 at 4 p.m. New York time, rebounding from a loss of 0.6 percent. The Dow Jones Industrial Average advanced 17.18 points, or 0.1 percent, to 12,096.16. About 6.3 billion shares changed hands on U.S. exchanges, 24 percent below the three-month average.

“It was good to hear about retail sales,” Randy Bateman, chief investment officer of Huntington Asset Management in Columbus, Ohio, said in a telephone interview. His firm oversees $14.5 billion. “People are getting tired of hearing about Europe. They are trying to resolve their issues. With Mario, Italy has an economist. Europe will muddle through.”

Equities recovered as Monti, an economist and former adviser to Goldman Sachs Group Inc., said he’s “convinced” that the country can overcome the current crisis as he prepares to meet with President Giorgio Napolitano tomorrow to present his new government. Stocks had fallen earlier after Spainn’s borrowing costs rose at an auction. Italian 10-year yields topped 7 percent and rates on French, Belgian, Spanish and Austrian debt rose to euro-era records above German bunds.                         

Benchmark gauges also rose after the U.S. Commerce Department reported a 0.5 percent increase in retail sales, compared with the median economist forecast that called for 0.3 percent growth. The Federal Reserve Bank of New York’s general economic index showed growth for the first time since May. Goldman Sachs Chief Executive Officer Lloyd Blankfein said the economy will rebound “faster than people think.”

“When the market isn’t focused on Europe, it will focus on stronger U.S. data,” Paul Zemsky, the New York-based head of asset allocation for ING Investment Management, said in an e- mail. His firm oversees $550 billion. “Retail sales are starting the quarter stronger than anyone would have estimated back in August at the depth of the recession fears.”

The Morgan Stanley Cyclical Index added 0.4 percent, after slumping 1.1 percent earlier, on speculation about an economic rebound. The Dow Jones Transportation Average rose 0.8 percent.                       

Technology shares in the S&P 500 rose 1.3 percent. Intel gained 2.9 percent to $25.34. Apple Inc., the world’s biggest technology company by market value, added 2.5 percent to $388.83. Dell Inc. advanced 2 percent to $15.63 before reporting quarterly results after U.S. exchanges closed. The shares slumped 1.8 percent to $15.35 after the close of regular trading at 4:27 p.m. as revenue missed estimates.

Computer and software makers may extend gains after a gauge of the industry surged to the highest ratio versus the S&P 500 in more than nine years, according to Brown Brothers Harriman & Co.

The level of the Technology Select Sector SPDR Fund, an exchange-traded fund that tracks companies including Apple and International Business Machines Corp., divided by the SPDR S&P 500 ETF Trust was 0.2128 on Oct. 17, the highest since January 2002, data compiled by Bloomberg show. The figure fell to 0.2069 as of yesterday.                       

The advance by the technology fund suggests the industry may have enough momentum to rise further, said Ari Wald, a New York-based technical strategist at Brown Brothers. Technology shares posted the second-best performance after utilities among the S&P 500’s 10 groups, losing 0.8 percent, over the past six months. The broader benchmark index fell 6.4 percent.

“We broke out to the upside recently, showing relatively strong demand,” Wald said in a telephone interview yesterday. “That’s a pretty good sign, especially that it’s able to post relative gains during this period of market volatility.”

 The KBW Bank Index of 24 stocks rose 0.5 percent after falling as much as 1.2 percent earlier today.

Bank of America Corp. climbed 1.3 percent to $6.13. The second-largest U.S. bank by assets is ahead of schedule on plans to bolster its balance sheet and meet new international standards, Chief Executive Officer Brian T. Moynihan said today at a conference. Separately, the lender said net credit card write-offs and delinquencies declined in October from September.                       

Wal-Mart lost 2.4 percent to $57.46. It didn’t pass higher prices charged by suppliers along to customers struggling with persistent unemployment, Bill Simon, Wal-Mart’s U.S. chief, said. That hurt gross profit margin, or the percentage of net sales left after subtracting the cost of goods sold, which shrank to 24.6 percent, narrower than the 24.8 percent estimate of Colin McGranahan at Sanford C. Bernstein & Co.

“The miss on weak gross margins was not expected, and that is new news,” McGranahan said in an e-mail. “The stock is down on the incremental news as more negative than expected.” He rates the shares “market perform.”

 Energy shares had the only decline in the S&P 500 among 10 industries, falling 0.2 percent. Chevron Corp. slumped 2.7 percent, the most in the Dow, to $103.27. The company said it appears to have halted a leak at the Frade project offshore Brazil after plugging a well. It said it has seen a significant decrease in the amount of oil seeping from the development.

American Airlines parent AMR Corp. tumbled 10 percent to $1.92, the lowest price since March 2003, after trying to end a five-year stalemate with a contract proposal that offers pilots smaller pay increases than they had sought. The Allied Pilots Association said today it was reviewing the plan as its board began a three-day meeting, and declined to comment further. AMR urged the union to permit members to vote on the offer.

LinkedIn Corp. slumped 4.6 percent to $74.86 after saying shareholder Bain Capital Ventures will sell all of its 3.71 million shares of the professional-networking website in a secondary stock offering.

Have a wonderful evening everyone.

Be magnificent!

Bees suck nectar from many different flowers, and then make honey.

One drop of honey cannot claim to come from one flower, and another drop of honey from another flower; the honey is a single consistent whole.

In the same way, all beings are one even though they are not aware of this.

The tiger and the lion, the wolf and the boar, the worm and the moth, the gnat and the mosquito, all come from the soul, and are part of the soul.

 

Chandogya Upanishad

As ever,

Carolann

Get out of your way.  You can spend your life

tripping on yourself; you can also spend your

life tripping yourself up.  Get out of your own

way.

        -Suzan-Lori Parks, 1963- 

 

 

 

 

Dear Friends,

Tangents:

Birthdays:

Prince Charles, Prince of Wales, b. 1948

Aaron Copeland, composer,  b. 1900

Claude Monet, painter, b. 1840

 

To stop the flow of music would be like the stopping of time itself, incredible and inconceivable. ~ Aaron Copland

One of the speakers at the World Business Forum this year was Benjamin Zander, conductor of the Boston Philharmonic Orchestra since 1979.  He has co-authored a book, The Art of Possibility, in which he claims that art and music can be used in the modern world to energize our interpersonal connections, add value to our new global society, and lead to innovation and the successful adoption new practices.    

He demonstrates that a conductor does not only direct orchestras, but with the right ear, can conduct through words and actions. 

From complexity to possibility: challenging assumptions.  He states “We are about contribution.  It’s not about impressing people….It’s about contributing something.”  The contributor mindset: being present, staying connected to reality, unleashing inner passion, expanding reach.  A great performance results from creating opportunities for individual and collective talent to bloom.

You can listen to him too at www.wbfny.net/2011/zander – a very inspirational, amazing man.

 

Photo of the day:

November 14, 2011

 

British soldiers from the King’s Troop Royal Horse Artillery, the saluting battery of Her Majesty’s Household Division, arrive to retrieve their guns after firing a Gun Salute for Britain’s Prince of Wales’ birthday, in central London’s Hyde Park. Lefteris Pitarakis/AP

Market Commentary:

Canada

By Matt Walcoff

Nov. 14 (Bloomberg) — Canadian stocks fell for the third time in four days, led by gold and energy producers, as the U.S. dollar rose on concern the European Central Bank may have to do more to quell the region’s debt crisis.

Barrick Gold Corp., the world’s largest gold producer, dropped 1.1 percent as the U.S. Dollar Index gained for the first time in three days. Encana Corp., Canada’s largest natural gas producer, declined 1.6 percent as the fuel dropped to a one- year low.

The Standard & Poor’s/TSX Composite Index slipped 52.66 points, or 0.4 percent, to 12,224.19.

“The market believes the ECB is going to have to provide more liquidity to prevent a longer recession than what is expected,” Andrew Pyle, an associate portfolio manager for Bank of Nova Scotia in Peterborough, Ontario, said in a telephone interview. Pyle’s team oversees about C$200 million ($197 million). “If there’s a risk the euro is going to decline, the U.S. dollar’s going to pick up. That’s clearly a negative for commodities.”

The S&P/TSX decreased 1.9 percent in the previous two weeks, led by financial stocks, as bond yields in the most- heavily indebted euro-region countries climbed and Manulife Financial Corp. and Sun Life Financial Inc. reported earnings that trailed analysts’ estimates.

Italy sold five-year bonds at the highest yield in more than 14 years today, on renewed concern over the debt crisis.

The country’s Treasury sold the bonds to yield 6.29 percent, up from 5.32 percent at the previous auction Oct. 13.                        

Precious metals declined as the U.S. dollar gained. Barrick lost 1.1 percent to C$53.12. Kinross Gold Corp., Canada’s third- largest company in the industry market value, slipped 1 percent to C$14.27. NovaGold Resources Inc., which is developing projects in Alaska and British Columbia, slumped 4 percent to C$8.97.

Alacer Gold Corp., which operates in Turkey, fell 4 percent to C$11.98 after saying Stuart Brown won’t become the company’s chief financial officer as the company announced Oct. 16. Brown had served as CFO and acting chief financial officer of Anglo American Plc’s De Beers unit.

Crude oil retreated from a three-month high on the New York Mercantile Exchange. Natural gas fell for a fourth day on forecasts for warmer-than-normal weather in the northern U.S.

Canadian Natural Resources Ltd., the country’s second- largest energy company by market value, dropped 1.4 percent to C$37.37. Encana slipped 1.6 percent to C$20.26.

Natural gas and oil producer Trilogy Energy Corp. climbed 4.7 percent to a record C$36.97 after analyst at Stifel Financial Corp. and GMP Capital Inc. raised their 12-month share-price estimates. The company’s 2012 production forecast surpassed the estimates of Kurt Molnar, the Stifel analyst, according to a note to clients.

Yoho Resources Inc., which explores for oil and gas in British Columbia, soared 21 percent, the most since December 2008, to C$3.81 after disclosing a reserves estimate for its Nig property.

Ivanhoe Mines Ltd., which is developing Mongolia’s Oyu Tolgoi copper and gold mine with Rio Tinto Group, rallied 3.6 percent to C$21.49 after reporting a third-quarter profit. All five analysts in a Bloomberg survey had forecast a net loss.

Hathor Exploration Ltd., which owns uranium properties in Saskatchewan, jumped 9 percent to a record C$4.87 after Cameco Corp. raised its hostile bid for the company to C$4.50 a share.

Hathor agreed to be bought for C$4.15 a share by Rio Tinto Oct. 19.

Potash Corp. of Saskatchewan Inc., the world’s largest fertilizer producer by market value, fell 0.9 percent to C$46.99 as corn and wheat dropped for a fourth day. Migao Corp., which produces fertilizer in China, plunged 14 percent to C$3.18 after reporting earnings that missed all eight analyst estimates in a Bloomberg survey.

US

By Rita Nazareth

Nov. 14 (Bloomberg) — U.S. stocks declined, snapping a two-day advance in the Standard & Poor’s 500 Index, as an increase in Italian borrowing costs deepened concern Europe will struggle to contain its sovereign debt crisis.

Morgan Stanley and Citigroup Inc. fell more than 2.6 percent. Bank of America Corp. slid 2.6 percent after agreeing to sell most of its China Construction Bank Corp. stake to boost capital. Bank of New York Mellon Corp. slid 4.5 percent as the world’s largest custody bank said it would book a charge of as much as $100 million this quarter. Boeing Co. added 1.5 percent after winning a record $26 billion order from Emirates.

The S&P 500 retreated 1 percent to 1,251.78 at 4 p.m. New York time. The Dow Jones Industrial Average decreased 74.70 points, or 0.6 percent, to 12,078.98. About 5.5 billion shares changed hands on U.S. exchanges, the lowest since April 25.

“These blip-ups in yields put more uncertainty in the market,” Peter Tuz, who helps manage about $800 million as president of Chase Investment Counsel Corp. in Charlottesville, Virginia, said in a telephone interview. “Just because they’ve had a bit of good news coming out of Europe last week, it doesn’t mean they don’t still have a lot of work to do to get their financial houses in order.”

Stocks fell as the yield on the Italian five-year bond rose following an auction and Spanish 10-year rates surged to a euro- era record above German yields. The S&P 500 extended its decline after German Finance Minister Wolfgang Schaeuble said Europe’s permanent bailout fund may not be implemented before 2013. The equity index also dropped after German Chancellor Angela Merkel’s Christian Democratic Union party voted to offer euro states a “voluntary” means of leaving the currency area.                          

Stocks rose last week, restoring the year-to-date gain for the S&P 500, as improving economic data and leadership changes in Greece and Italy bolstered investor optimism. Equities tumbled on Nov. 9 as yields on Italian government bonds surged, fueling concern European leaders will struggle to fund bailouts. “There’s a lot of risk to the global financial system,”

Hayes Miller, who helps oversee about $43 billion as the Boston- based head of asset allocation in North America at Baring Asset Management Inc., said in a telephone interview. “The size of the problem is huge. Until you solve this problem, you aren’t getting rid of the risk a large-scale default.”

Lenders in the Stoxx Europe 600 Index fell 1.8 percent and financial shares had the biggest decline in the S&P 500 among 10 industries, dropping 2 percent. Morgan Stanley decreased 2.7 percent to $15.92. Citigroup sank 3.2 percent to $28.38.

U.S. shares of Credit Suisse Group AG fell 3.4 percent to $24.19. The Swiss bank may have its long-term credit rating cut by Moody’s Investors Service after the investment banking unit posted a loss and income at the wealth-management division fell.

Bank of America slid 2.6 percent to $6.05. The second- biggest U.S. lender by assets will sell 10.4 billion CCB shares this month to a group of investors in private transactions for an after-tax gain of about $1.8 billion, the bank said today.

After the closing, the company will own about 1 percent of the common shares of CCB, the U.S. lender said.

Bank of New York Mellon slumped 4.5 percent to $20.55. The bank plans to save as much as $700 million before taxes by 2015, through operational improvements such as consolidating applications, insourcing software development and consolidating locations. BNY Mellon is cutting expenses as lawsuits over the pricing of foreign exchange transactions are pushing up legal costs and interest rates near zero erode revenue.

“The cuts do not have the impact that most people were hoping” for, Gerard Cassidy, an analyst with RBC Capital Markets in Portland, Maine, said in an e-mail.                       

Boeing rallied 1.5 percent, the most in the Dow, to $67.94.

The company signed an agreement with Emirates at the Dubai Air show for 50 of its 777-300ER jets and an option for 20 more, in a deal valued at $26 billion. The accord extends their relationship in the wide-body market, with Emirates operating more than 90 of the 777s for the industry’s biggest such fleet.

Lowe’s Cos. advanced 1.7 percent to $23.50. The second- largest U.S. home-improvement retailer reported third-quarter profit that exceeded analysts’ estimates, helped by sales at older stores.

Salesforce.com Inc. increased 2.8 percent to $133.52. The supplier of online customer-management software was raised to “buy” from “neutral” at Citigroup, which cited “increasing confidence in long-term profitability.” Citigroup gave a price estimate of $158 a share. International Business Machines Corp. lost less than 0.1 percent to $187.35, after rallying as much as 1.3 percent.

Warren Buffett’s Berkshire Hathaway Inc. bought a 5.5 percent stake in the computer-services provider as the billionaire chairman accelerated stock purchases. Buffett, who spent more than $10 billion on IBM stock, paid near-record prices for the shares, recalling his winning 1988 investment in Coca-Cola Co.

Berkshire began buying IBM shares this year after Buffett read the Armonk, New York-based company’s annual report and saw the firm “through a different lens,” the billionaire told CNBC today in an interview. IBM had doubled in New York trading in the 27 months prior to the Feb. 22 release of its yearly 10-K filing. Coca-Cola had doubled in the four years through the end of 1987, and has risen more than 10-fold since.

“I think he looked at Coke through a different lens back in 1988,” said Jeff Matthews, a Berkshire shareholder and author of “Secrets in Plain Sight: Business and Investing Secrets of Warren Buffett.” In IBM, “he sees a business that supports the world’s IT infrastructure and has a lot of room to grow over the next couple decades.”                

Bank of America’s Savita Subramanian estimates the S&P 500 will rise to 1,350 in 2012, as the U.S. economy avoids a recession and earnings growth continues to push the gauge higher.

 Combined profit by companies in the benchmark equity measure will be $98.25 a share this year and $104.50 next year, according to Subramanian, the head of equity and quantitative strategy, in her first equity forecasts since taking over the role from David Bianco in September. The year-end projection is 6.8 percent higher than the S&P 500’s close on Nov. 11.

“While we expect uncertainty and volatility to remain high well into 2012, the avoidance of a U.S. recession and continued earnings growth could drive the S&P 500 toward the high end of its two-year trading range” of 1,100 to 1,365, a team led by Subramanian wrote in a note dated today.

Have a wonderful evening everyone.

Be magnificent!

In music, I am the melody.

 

The Bhagavad Gita

As ever,

Carolann

You may have to fight a battle

more than once to win it.

     -Margaret Thatcher, 1925-

 

Dear Friends,

Tangents:  Full moon tonight.

Birthday: November 10^th, 1983, Microsoft releases Windows.

Noteworthy: November 10, 1871, Stanley finds Livingstone.

Some markets are closed tomorrow for Remembrance Day; bond markets are closed.

Lest we forget…

In Flanders fields the poppies blow
Between the crosses, row on row,
That mark our place: and in the sky
The larks still bravely singing fly
Scarce heard amid the guns below.

We are the dead: Short days ago,
We lived, felt dawn, saw sunset glow,
Loved and were loved: and now we lie
In Flanders fields!

Take up our quarrel with the foe
To you, from failing hands, we throw
The torch: be yours to hold it high
If ye break faith with us who die,
We shall not sleep, though poppies grow
In Flanders fields

Composed at the battlefront on May 3, 1915
during the second battle of Ypres, Belgium

On May 2, 1915, John McCrae’s close friend and former student Alexis Helmer was killed by a German shell. That evening, in the absence of a Chaplain, John McCrae recited from memory a few passages from the Church of England’s “Order of the Burial of the Dead”. For security reasons Helmer’s burial in Essex Farm Cemetery was performed in complete darkness.

The next day, May 3, 1915, Sergeant-Major Cyril Allinson was delivering mail. McCrae was sitting at the back of an ambulance parked near the dressing station beside the YserCanal, just a few hundred yards north of Ypres, Belgium.

As John McCrae was writing his In Flanders Fields poem, Allinson silently watched and later recalled, “His face was very tired but calm as he wrote. He looked around from time to time, his eyes straying to Helmer’s grave.”

Within moments, John McCrae had completed the “In Flanders Fields” poem and when he was done, without a word, McCrae took his mail and handed the poem to Allinson.

Allinson was deeply moved:

“The (Flanders Fields) poem was an exact description of the scene in front of us both. He used the word blow in that line because the poppies actually were being blown that morning by a gentle east wind. It never occurred to me at that time that it would ever be published. It seemed to me just an exact description of the scene.”

Photos of the day

November 10, 2011

Crosses commemorating British military casualties in Afghanistan are seen in the Field of Remembrance outside Westminster Abbey in central London. Suzanne Plunkett/Reuters.

Market Commentary:

Canada

By Matt Walcoff

Nov. 10 (Bloomberg) — Canadian stocks fell for a second day as precious metals dropped after Italian bond yields declined from euro-era records, indicating more confidence in the country’s ability to pay its debts.

Silver Standard Resources Inc., which mines in Latin America, plunged 21 percent after cutting its resources estimate at its Pirquitas mine. First Quantum Minerals Ltd., Canada’s second-largest publicly traded copper producer, lost 7.9 percent after two analysts reduced their ratings on the shares.

TransCanada Corp., the owner of the country’s biggest pipeline system, decreased 1.8 percent after the U.S. government delayed a decision on the company’s proposed Keystone XL pipeline.

 The Standard & Poor’s/TSX Composite Index slipped 47.35 points, or 0.4 percent, to 12,108.87, the lowest close since Oct. 21.

“The golds are getting whacked,” David Cockfield, a money manager at Northland Wealth Management in Toronto, said in a telephone interview. The firm oversees about C$225 million ($221 million). “Things are settling down in Europe. The Greek situation, they’ve named a new prime minister, and the Italians have sort of settled on somebody.”

The index lost 2.7 percent yesterday, extending its 2011 retreat to 9.6 percent, as Italian bond yields surged after LCH Clearnet SA raised deposit requirements for trading the debt securities. Energy, materials and financial companies in the S&P/TSX have fallen in part on concern the European debt crisis will weaken the global economy.

Italian bonds gained today after the country sold 5 billion euros ($6.8 billion) in one-year bills, the maximum for the auction. Demand was 1.99 times the amount on offer.

Italian Foreign Minister Franco Frattini said today Mario Monti, the top candidate to replace Silvio Berlusconi, “has an international reputation nobody can deny.” Italy’s president, Giorgio Napolitano, named Monti, a former European Union competition commissioner, a senator for life yesterday. Berlusconi has pledged to resign after the country’s parliament passes austerity measures.

In Greece, President Karolos Papoulias named Lucas Papademos, a former European Central Bank vice president, to succeed George Papandreou as prime minister. The country’s political parties had debated for four days who would lead a unity government.                        

Gold futures fell the most in three weeks on the Comex in New York on reduced demand for havens from the debt crisis.

Kinross Gold Corp., Canada’s third-largest gold producer by market value, dropped 2.4 percent to C$14.06. European Goldfields Ltd. slumped 5.5 percent to C$10.12 after reporting twice as large of a quarterly loss as the average estimate in a Bloomberg survey of analysts, excluding certain items.

Silver Standard sank 21 percent, the most since July 2002, to C$15.44 after reducing the estimates from the Pirquitas mine in Argentina. The shares closed at the lowest price since December 2008.

Lake Shore Gold Corp., which mines in Canada, rallied 10 percent to C$1.71 after reporting a new discovery at its Timmins Mine in Ontario.

Gold explorer Tanzanian Royalty Exploration Corp. tumbled 33 percent, the most since August 1998, to C$2.31 after a fund placed an order to sell its stake in the company, according to Jim Sinclair, Tanzanian Royalty’s chief executive officer.                        

First Quantum dropped 7.9 percent to C$18.20 after analysts at Cormark Securities Inc. and Numis Corp. cut their ratings on the shares. First Quantum tumbled 14 percent yesterday after reporting earnings that missed the average analyst estimate by 46 percent, excluding certain items.

TransCanada retreated for a fifth day, slipping 1.8 percent to C$39.85 after the U.S. State Department said it would study an alternative route for the company’s planned pipeline from Alberta to the Gulf of Mexico. The department cited environmental concerns in an e-mailed statement.

ShawCor Ltd., which provides pipeline products and services, lost 9 percent, the most since January 2009, to C$23.58. The company reported third-quarter profit that trailed the average analyst estimate in a Bloomberg survey by 63 percent, excluding certain items.                      

The six largest S&P/TSX banks fell after Andre-Philippe Hardy, an analyst at Royal Bank of Canada, cut his fourth- quarter profit estimates for each lender except his own, which he doesn’t cover.

Canadian Imperial Bank of Commerce, the country’s fifth- largest lender by assets, dropped 1.6 percent to C$71.45. Bank of Montreal, Canada’s fourth-biggest bank, declined 0.8 percent to C$56.87.

Canadian National Railway Co., the country’s biggest railroad, gained 2 percent to C$80.60. Total U.S. rail traffic climbed 3.8 percent in the week ended November 5, the latest for which data from the Association of American Railroads are available. Intermodal goods, which can move by highway, rail and sea, rose 4.6 percent and commodity carloads advanced 3.1 percent, according to Bloomberg Industries.

US

By Michael P. Regan and Rita Nazareth

Nov. 10 (Bloomberg) — Stocks rose, with the Standard & Poor’s 500 Index rebounding from its worst drop since August, as jobless claims fell while a retreat in Italian bond yields and the selection of a new Greek premier tempered concern about Europe’s crisis. The euro gained and Treasuries slid.

The S&P 500 rose 0.9 percent to close at 1,239.7 at 4 p.m. in New York. Italy’s 10-year bond yield, which surged to a record yesterday, dropped 36 basis points to 6.89 percent today as the European Central Bank bought the country’s debt and the nation sold all the bills planned at an auction. The euro appreciated 0.4 percent to $1.3601. Cotton and oil rose at least 1.8 percent to lead commodities higher. Ten-year Treasury yields lost six basis points.

U.S. equities resumed gains after falling earlier amid a surge in French bond yields. Stocks recovered as S&P said it did not cut France’s credit rating, clarifying a statement that suggested the rating had changed. Equities rallied as U.S. initial jobless claims decreased to the lowest level in seven months, Italy sold 5 billion euros ($6.8 billion) of one-year bills and former vice president of the European Central Bank Lucas Papademos was named Greece’s interim leader.

“I’m not willing to step up and proclaim all clear, but we’re moving in the right direction,” Don Wordell, a fund manager for Atlanta-based RidgeWorth Capital Management, which oversees about $47 billion, said in a telephone interview. “The new Greece premier was a great start and the fact that bond yields came back down is great for Italy. The most positive news of the day, though, was the jobless claims data showing that the U.S. economy is slowly getting better.”                        

Gauges of energy, health-care and industrial companies rose more than 1 percent for the biggest gains among the 10 main industries in the S&P 500, all of which advanced. Merck & Co. surged 3.5 percent after increasing its dividend, while Cisco Systems Inc. rallied 5.7 percent after earnings topped analyst estimates. The two stocks led the Dow Jones Industrial Average to an advance of 112.92 points, or 1 percent, to 11,893.86.  Apple Inc. slumped 2.6 percent as Cleveland Research Co. reduced its earnings forecast and iPad-shipment estimates.

More than $1 trillion was erased from the value of global equities yesterday, with the S&P 500 sliding 3.7 percent, as a surge in Italy’s bond yields to euro-era records signaled Europe’s sovereign debt crisis was intensifying. The nation’s Senate today rushed to pass debt-reduction measures that clear the way for establishing a new government that may be led by former European Union Competition Commissioner Mario Monti.                        

The Dollar Index, which tracks the U.S. currency against those of six trading partners, fell 0.4 percent after advancing as much as 0.3 percent. The U.S. currency weakened against 12 of 16 major peers, with Brazil’s real and the South African rand climbing 1 percent for the biggest gains.

The 10,000 drop in jobless claims to 390,000 compared with the median forecast of economists in a Bloomberg News survey for 400,000 new claims. Another report showed the U.S. trade deficit unexpectedly narrowed in September to the lowest level this year as exports surged to a record high.

Federal Reserve Chairman Ben S. Bernanke said the central bank is concentrating “intently” on reducing unemployment and projects inflation to stay under control for the “foreseeable future.”

“For a lot of people, I know, it doesn’t feel like the recession ever ended,” even with the economy growing for two years, Bernanke said today in remarks at a town hall-style meeting at Fort Bliss in El Paso, Texas. “These problems are very serious, and we at the Federal Reserve have been focusing intently on supporting job creation.”                      

Treasuries fell as the U.S. sold $16 billion in 30-year bonds amid weaker-than-average demand. The bonds drew a yield of 3.199 percent, compared with the average forecast of 3.148 percent in a Bloomberg News survey of eight of the Federal Reserve’s 21 primary dealers. The bid-to-cover ratio was 2.4 percent, compared with an average of 2.68 percent for the past 10 sales.

Existing 30-year bond yields increased eight basis points to 3.11 percent.

Among commodities tracked by the S&P GSCI, 10 rose and 14 retreated. Oil climbed 2.1 percent to $97.78 a barrel in New York, the highest level in more than three months. Delta Air Lines Inc. lost 4.8 percent to lead the NYSE Arca Airline Index down 1.6 percent amid concern about higher fuel costs. Copper fell 1.9 percent. Gold for December delivery lost 1.8 percent to $1,759.60 an ounce.                        

The Stoxx Europe 600 Index slipped 0.4 percent, erasing an earlier 0.8 percent gain. Credit Agricole SA lost 2.3 percent to help lead banks lower as French bond yields rose. Vedanta Resources Plc led a drop in mining shares, tumbling 9.5 percent.

Air France-KLM Group retreated 5 percent after forecasting a full-year loss.

French 10-year bond yields climbed 27 basis points to 3.47 percent, a four-month high, and reached a euro-era record of 169 basis points above benchmark German bunds.

The cost of insuring against default on French government debt rose to a record. Credit-default swaps on France rose six basis points to 203, according to CMA prices, surpassing the record closing price of 202 set Sept. 22. The Markit iTraxx SovX Western Europe Index increased for a fifth day, climbing 2.4 basis points to 343.                        

S&P confirmed that France remains rated AAA with a stable outlook after a technical error caused the ratings company to send a headline suggesting it may have been downgraded. S&P is investigating the cause of the technical error, it said in a statement.

 France may have its credit grade lowered by Egan-Jones Ratings Co. because the euro-region’s second largest economy is becoming one of its weakest.

France’s rating is “probably heading south” on France’s rating, Sean Egan, the firm’s president and founding principal, said in a radio interview on “Bloomberg Surveillance” with Ken Prewitt and Tom Keene. A list of Europe’s weaker countries “might extend also to France,” he said. Egan-Jones currently rates France AA-, he said in response to an e-mailed question after the interview.

The Italian two-year note yield slid 80 basis points to 6.40 percent, after jumping 82 basis points yesterday.

The ECB bought Italian government bonds today, according to three people familiar with the transactions, who declined to be identified because the deals are confidential. The ECB wasn’t immediately available for comment when contacted by telephone by Bloomberg.

European efforts to speed the setup of a permanent rescue fund have lost momentum amid a clash between Germany and France over provisions to force bondholders to share losses, three people involved in the negotiations said.

The European Commission cut its euro-region growth forecast for next year by more than half and said it sees the risk of a recession. Gross domestic product may grow 1.5 percent this year and 0.5 percent in 2012, the Brussels-based commission said today. It had earlier projected the 17-nation region to expand 1.6 percent and 1.8 percent this year and next, respectively. In 2013, the economy may expand 1.3 percent, the commission said.

The MSCI Emerging Markets Index slipped 2.5 percent. The MSCI Asia Pacific Index declined 3.3 percent, the most since Sept. 22. The Hang Seng China Enterprises Index of mainland companies listed in Hong Kong tumbled 5.7 percent as China’s export growth slowed.

Have a wonderful evening everyone.

Be magnificent!

The soul is the home of all living beings;

and from the soul all living beings derive their strength.

There is nothing in the universe that does not come from the soul.

The soul dwells within all that exists;

it is the truth of all that exists.

You, my son, are the soul.

 

-Chandogya Upanishad

As ever,

Carolann

Per ardua ad astra.

Through adversity to the stars.

     -Latin motto of the RCAF