Month: June 2012

Dear Friends,

Tangents:

The assassination of the Austrian Archduke Franz Ferdinand in Bosnia in 1914, the immediate cause of the First World War, described by Borijove Jevtic, one of the Serbian nationalist conspirators on June 28^th, 1914:

Two hours before Franz Ferdinand arrived I Sarajevo all the twenty-tow conspirators were in their allotted positions, armed and ready.  They were distributed five hundred yards apart over the whole route along which the Archduke must travel from the railroad station to the town hall….After the reception in the Town Hall General Potiorek, the  Austrian commander, pleaded with Franz Ferdinand to leave the city, as it was seething with rebellion.  The Archduke was persuaded to drive the shortest way out of the city and to go quickly.  The road to the manoeuvres was shaped like the letter V, making a sharp turn at the bridge over the River Nilgacka.  Franz Ferdinand’s car could go fast enough until it reached this spot but here it was forced to slow down for the turn.  Here Princip had taken his stand.

As the car came abreast he stepped forward from the curb, drew his automatic pistol from his coat and fired two shots.  The first struck the wife of the Archduke, the Archduchess Sofia, in the abdomen.  She was an expectant mother.  She died instantly.

The second bullet struck the Archduke close to the heart.  He uttered only one word – Sofia – a call to his stricken wife.  Then his head fell back and he collapsed.  He died almost instantly.  –from The Folio Book of Days

And that’s what it took to give the world The Lost Generation…

And also on this day in…

1577 – Painter Peter Paul Rubens was born.

1712 – Jean-Jacques Rousseau, philosopher, was born.

1919 – Keynes predicts economic chaos.

1919 – Treaty of Versailles is signed, formally ending the First World War.

1928 – Louis Armstrong records “West End Blues”
1953 – Workers assemble first Corvette in Flint, Michigan.
1969 – Stonewall Riot: start of the Gay Liberation movement.
1972 – President Nixon announces no new draftees will go to Vietnam.
1981 – Terry Fox died at age 22, of lung cancer.

I feel that art has something to do with the achievement of stillness in the midst of chaos. A stillness which characterizes prayer, too, and the eye of the storm. I think that art has something to do with an arrest of attention in the midst of distraction. –Saul Bellow, 1915-2005

photo of the day June 28, 2012

Supertrees light up against the dusk skyline in Singapore. These Supertrees serve as vertical gardens in the Gardens By The Bay, part of Singapore’s efforts to nurture greenery within the city. It opens its doors to the public for the first time Friday.

Wong Maye-E/AP

Market Closes for June 28, 2012:

North American Markets

Market  Index	Close	Change
Dow  Jones	12602.26	-24.75
		-0.20%
S&P 500	1328.86	-2.99
		-0.22%
NASDAQ	2849.49	-25.83
		-0.90%
TSX	11414.32	+3.38
		+0.03%

International Markets

Market  Index	Close	Change
NIKKEI	8874.11	+143.62
		+1.65%
HANG  SENG	19025.27	-151.68
		-0.79%
SENSEX	16990.76	+23.00
		+0.14%
FTSE 100	5496.06	-30.86
		-0.56%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	1.680	1.723
CND.   30 Year Bond	2.293	2.324
U.S.   10 Year Bond	1.5853	1.6177
U.S.   30 Year Bond	2.6823	2.6918

Currencies

BOC Close	Today	Previous
Canadian $	1.03337	1.02533
US   $	0.96771	0.97530
Euro Rate  1 Euro=		Inverse
Canadian   $	1.28571	0.77778
US  $	1.24419	0.80374

Commodities

Gold	Close	Previous
London Gold   Fix	1555.35	1574.53
Oil	Close	Previous
WTI Crude Future	77.81	80.21
BRENT	91.77	93.29

Market Commentary:

Canada

By Katia Dmitrieva

June 28 (Bloomberg) — Canadian stocks pared losses in the final hour of trading, sending the benchmark index higher for a third day, amid speculation European leaders were nearing an agreement on plans to halt contagion in the debt crisis.

Energy stocks rallied, outweighing a decline in raw- material companies as oil and gold fell. Progress Energy Resources Corp. surged 74 percent after agreeing to be bought by Petroliam Nasional Bhd, Malaysia’s state-owned oil and natural- gas company, for C$4.8 billion ($4.67 billion) in cash. Bank of Montreal and Toronto-Dominion Bank gained, pacing a recovery among financial shares.

The S&P/TSX gained 13.76 points, or 0.1 percent, to 11,424.70, reversing an earlier drop of as much as 1.2 percent.

The benchmark index is down 7.8 percent for the quarter.

Stocks trimmed declines today as German Chancellor Angela Merkel canceled a press briefing at a summit in Brussels as talks on a growth accord continued, her spokesman Steffen Seibert said. After the market closed, EU President Herman Van Rompuy said leaders had agreed on a 120 billion euros ($149 billion) plan to stoke the economy and create jobs.

Energy stocks rallied following Progress Energy’s deal. The Calgary-based oil and natural gas producer jumped 74 percent to C$20.05. Petronas Chief Executive Officer Shamsul Azhar Abbas said March 30 he wants to expand his company’s presence in Canada and Australia. The company bought a stake in three of Progress Energy’s gas fields last year and agreed to explore development of a liquefied natural gas terminal to export the fuel.

Advantage Oil & Gas Ltd. advanced 5.3 percent to $2.96.

Celtic Exploration Ltd. rose 7.2 percent to C$13.72, the highest level since May. Encana Corp., Canada’s biggest natural-gas producer, gained 6.7 percent to C$21.08.

Financial shares dropped 0.2 percent as a group, paring  an earlier loss of as much as 1.4 percent. Bank of Montreal, Canada’s fourth-largest lender, rose 0.4 percent to C$55.52.

Toronto-Dominion, the nation’s second-largest lender, advanced0.1 percent to C$79.17.

Gold declined to the lowest in almost four weeks amid signs of slowing U.S. growth. The number of applications for U.S. unemployment benefits hovered last week near the highest level of the year, the Labor Department said.

Barrick Gold Corp., the world’s largest producer of the metal, dropped 0.4 percent to C$37.43. Goldcorp Inc. declined 2.8 percent to C$37.31, the lowest since May 29.

Tahoe Resources Inc. plunged 23 percent to C$12.50. The developer of the Escobal silver mine in Guatemala tumbled after Mineweb reported that the government proposed taking stakes in mining companies operating in the country, citing newspaper Prensa Libre.

“High-level officials in Guatemala’s Ministry of Energy and Mines indicate the government has no intention of acquiring an interest in the Escobal project or other mining projects in the country,” the Reno, Nevada-based company said in a statement today.

Centerra Gold Inc. plunged 32 percent to C$6.72. The owner of the Kumtor mine in Kyrgyzstan said it believes a parliamentary resolution calling for changes to the agreements governing the project isn’t legally binding. The company dropped 26 percent on June 22 after the company said the parliamentary report alleged Centerra’s operations had caused environmental damage.

US

By Rita Nazareth and Julia Leite

June 28 (Bloomberg) — U.S. stocks pared losses in the final hour of trading amid speculation European leaders were nearing an agreement to halt contagion from the debt crisis.

After the market close, European Union President Herman Van Rompuy said leaders agreed to spend 120 billion euros ($149 billion) to stimulate growth. JPMorgan Chase & Co. tumbled 2.5 percent after the New York Times said trading losses from credit derivatives may total as much as $9 billion, exceeding the firm’s initial estimate. Health-care stocks in the Standard & Poor’s 500 Index fell 0.3 percent as the Supreme Court upheld the core of President Barack Obama’s industry overhaul.

The S&P 500 dropped 0.2 percent to 1,329.04 at 4 p.m. New York time, paring a loss of as much as 1.4 percent. The Dow Jones Industrial Average slid 24.75 points, or 0.2 percent, to 12,602.26. Volume for exchange-listed stocks in the U.S. was 6.8 billion shares, about in line with the three-month average.

European leaders began a two-day summit in Brussels today intended to chart a path out of their financial crisis. Stocks pared losses as German Chancellor Angela Merkel canceled a press briefing and her spokesman said talks on a growth accord were ongoing.

“Europe has been the driver of this market,” said Walter “Bucky” Hellwig, who helps manage $17 billion at BB&T Wealth Management in Birmingham, Alabama. “The postponement of a conference call was a signal for traders to put on more risk.

Another ‘kick the can’ would be viewed as favorable.”

Equities tumbled earlier today as the number of applications for unemployment benefits hovered last week near the highest of the year, showing little improvement in the labor market. The U.S. economy grew 1.9 percent in the first quarter, reflecting a gain in consumer spending that now shows signs of cooling as the labor market weakens.

Concern about a worsening of Europe’s debt crisis and a global slowdown has taken the S&P 500 down 5.6 percent this quarter. Technology and financial shares have had the biggest losses in the period, tumbling at least 9.6 percent.

Financial shares in the S&P 500 dropped 0.2 percent, paring a loss of as much as 1.9 percent. Barclays Plc’s record $451 million fines for interest rate manipulation sent bank shares plunging as U.S. and U.K. authorities pursue sanctions in a global investigation of more than a dozen lenders.

JPMorgan slumped 2.5 percent to $35.88. The New York Times reported that the lender’s losses have increased in recent weeks as it sought to exit its holdings, citing unidentified former traders and executives at the bank.

JPMorgan won’t have a “major loss” in 2012 following the lender’s disclosure of losses from credit derivatives that could amount to more than $2 billion this quarter, Richard Bove said.

“We’re not expecting JPM to run a major loss,” Bove, an analyst with Rochdale Securities LLC, said today in a Bloomberg Television interview with Tom Keene. “I don’t believe that there’s any likelihood that the liquidity of the company is going to be affected by this.”

Citigroup Inc. dropped 2.6 percent to $26.39, trimming a decline of as much as 5.4 percent. The bank is not one of the lenders being investigated by the U.K.’s Financial Services Authority for attempting to manipulate the London interbank offered rate, the company said in an emailed statement today.

Tenet Healthcare Corp. led hospitals and Medicaid insurers higher while commercial health plans led by WellPoint Inc. fell after the U.S. Supreme Court upheld most of President Barack Obama’s health-care overhaul.

Tenet, the third-biggest hospital chain, rose 5.4 percent to $5.25, while Medicaid plan Molina Healthcare Inc. climbed 8.6 percent to $23.16. Indianapolis-based WellPoint, the second- largest U.S. health insurer, declined 5.2 percent to $65.90.

Cisco Systems Inc., the largest maker of computer- networking gear, slipped 1.5 percent to $16.48 after Lazard Ltd. said in a note today that the company may be seeing weaker-than- expected demand trends.

Family Dollar Stores Inc. slumped 2.8 percent to $67.20.

The owner of more than 7,200 discount shops in the U.S. narrowed its fiscal 2012 profit forecast. Rival Dollar Tree Inc. retreated 2.4 percent to $52.18, while Dollar General Corp. declined 0.5 percent to $53.73.

News Corp. dropped 1.4 percent to $21.99, after climbing 11 percent over the previous two days. It announced plans to split into two publicly traded entities focused on publishing and entertainment after shareholder pressure prompted the biggest reorganization since Rupert Murdoch built the media empire.

Genworth Financial Inc. rallied 11 percent to $5.43. The life insurer and mortgage guarantor surged as hedge fund Highfields Capital Management LP said it is in talks with management about increasing the value of its stake.

U.S. executives are tapping into their record pile of cash for the first time in four years as they drive spending on plants and equipment to an all-time high.

Cash held by S&P 500 companies, excluding financial institutions and utilities, fell 1.4 percent to $1.01 trillion in the first quarter, according to data compiled by Howard Silverblatt, a New York-based senior index analyst at S&P.

Capital spending, based on 12-month trailing data compiled by Bloomberg for the entire index, rose 3.3 percent during the same period and reached a record $66.6 billion last month.

While record-low interest rates may have prompted companies to build more factories, concern over the European debt crisis and expiration of Bush-era tax cuts will make executives reluctant to keep increasing spending, said David Sowerby, a money manager at Boston-based Loomis Sayles & Co.

“It will only persist to the extent that companies remain reasonably confident in the business outlook,” Sowerby, whose firm oversees about $170 billion, said in a telephone interview.

“With the great concern in Europe as well as the pending expiration of the tax cuts, you could see a return to rebuilding cash and less capital expenditure.”

Companies amassed $1.03 trillion in cash at the end of last year after beating analysts’ earnings estimates for 12 straight quarters, data compiled by S&P and Bloomberg show. Combined profits by S&P 500 stocks rose 9.9 percent to a record $92.09 a share in 2011, Bloomberg data show.

Executives are seeking ways to give back money to shareholders. While share buybacks fell by 6.2 percent to $84.3 billion in the first quarter from a year earlier, dividends increased by 14 percent to $64.1 billion, S&P data show.

Have a wonderful evening everyone.

Be magnificent!

 

Very few people in this world can reason normally.

There is a terrible tendency to accept all that is said, all that is read, and to accept it without question.

Only he who is ready to question, to think for himself, will find the truth!

To understand the currents of a river,

he who wishes to know the truth must enter the water.

Nisargadatta, 1897-1981

As ever,

Carolann

 

A government which robs Peter to pay Paul

can always depend on the support of Paul.

-George Bernard Shaw, 1856-1950

 

Carolann Steinhoff, B.Sc., CFP, CIM, FCSI

Senior Vice-President &

Senior Investment Advisor

Queensbury Securities Inc.,

St. Andrew’s Square

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7

 

Dear Friends,

Tangents:

This is the last week for legal foie gras in California.  A law to shut down the making, cooking and selling of super-fatty goose or duck liver takes effect July 1….The law’s purpose is to end gavage, the ancient practice of forcing grain down the throat of a goose or duck until its liver is grossly enlarged.  The law’s critics say gavage is hardly more stress-inducing than the many other things humans do to the animals they eat.  The corporate operations that grow and slaughter pigs, poultry and cattle represent animal cruelty on an immense scale, they say, about which the foie gras ban does nothing….It is not known how energetically the state will enforce the ban and if any restaurant chefs will be willing to risk a $1,000 fine.  Chicago enacted a foie gras ban in 2006.  It was widely mocked and flouted and, after a couple of years, repealed.   Chefs in California are already pushing for a repeal bill.

Meanwhile, “faux gras” recipes are proliferating on the Web.  One chef suggests soaking chicken livers overnight in milk with garlic, thyme, salt and pepper, searing them briefly and then puréeing them in a food processor with half their weight in soft butter.  It’s your basic chicken-liver mousse, not foie gras but goo.  “You could mix almost anything with half its weight in butter and have a very nice spread,” said Mark Bittman, one of The Times’s experts on such things.  –Lawrence Downes, NY Times.

Not to mention the torture we subject potatoes and carrots to, pulling them from their dark little homes in the earth or…

And on this day in…

1859 – “Happy Birthday to You” song was composed.
1871 – The yen becomes the new form of currency in Japan.

1880 – Helen Keller was born.
1918 – Two German pilots are saved by parachutes for the first time.
1929 – Scientists at Bell Laboratories in New York reveal a system for transmitting television pictures.
1944 – Allied forces capture the port city of Cherbourg, France.
1950 – Truman order U.S. Forces to Korea

Self-pity is our worst enemy and if we yield to it, we can never do anything good in the world. – Helen Keller, 1880-1968

photos of the day June 27, 2012

A sculpture called ‘Woman walking to the sky’ by US artist Jonathan Borofsky is seen in Strasbourg, France.

Vincent Kessler/Reuter

Alan Ellinson abseils with the Olympic Flame down the side of the Royal Dock Tower in Grimsby, England, at the beginning of Day 40 of the London 2012 Olympic Torch Relay.

Joe Giddens/LOCOG/AP

Market Closes for June 27, 2012:

North American Markets

Market  Index	Close	Change
Dow  Jones	12627.01	+92.34
		+0.74%
S&P 500	1331.85	+11.86
		+0.90%
NASDAQ	2875.32	+21.26
		+0.74%
TSX	11410.94	+76.52
		+0.68%

International Markets

Market  Index	Close	Change
NIKKEI	8730.49	+66.50
		+0.77%
HANG  SENG	19176.95	+195.11
		+1.03%
SENSEX	16967.76	+61.18
		+0.36%
FTSE 100	5523.92	+76.96
		+1.41%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	1.723	1.747
CND.   30 Year Bond	2.324	2.324
U.S.   10 Year Bond	1.6177	1.6297
U.S.   30 Year Bond	2.6918	2.7007

Currencies

BOC Close	Today	Previous
Canadian $	1.02533	1.02431
US   $	0.97530	0.97626
Euro Rate  1 Euro=		Inverse
Canadian   $	1.27855	0.78214
US  $	1.24697	0.80195

Commodities

Gold	Close	Previous
London Gold   Fix	1574.53	1572.88
Oil	Close	Previous
WTI Crude Future	80.21	79.36
BRENT	93.29	92.37

Market Commentary:

Canada

By Katia Dmitrieva

June 27 (Bloomberg) — Canadian stocks rose as energy producers advanced along with oil and natural gas amid mounting speculation that China will introduce additional economic stimulus and better-than-forecast U.S. economic data.

Energy stocks rallied as oil traded above $80 dollars a barrel. Suncor Energy Inc. gained 1.8 percent while Encana Corp., Canada’s biggest natural-gas producer, climbed 3.8 percent. Enbridge Inc., the nation’s largest pipeline company, rose 0.5 percent after falling as much as 1.6 percent yesterday.

The Standard & Poor’s/TSX Composite Index advanced 76.52 points, or 0.7 percent, to 11,410.94 in Toronto. Eight out of 10 industries in the index advanced, with phone and health-care companies trailing. The index is down 0.9 percent in June, headed for a fourth straight month of declines.

“Any positive news out of China is going to have a positive effect on the whole commodity sector,” said David Cockfield of Toronto-based Northland Wealth Management, which manages C$200 million ($195 million), in a phone interview.

“China has to move people in the country, into the cities, build infrastructure, and that takes a lot of the resources they import — and energy.”

Canadian equities followed a rally in global stocks today as the China Securities Journal said the country may introduce “more proactive” policies to ensure stable growth in the world’s second-largest economy and data on U.S. home sales and durable-goods orders topped forecasts. European leaders prepared for a two-day summit starting tomorrow.

Encana, which is expanding into Michigan’s shale- exploration region, paced gains in energy, advancing 3.8 percent to C$19.75. Natural gas futures jumped to a five-month high on forecasts for hotter-than-normal weather that would boost fuel demand from power plants.

Suncor, the nation’s largest oil provider, rose 1.8 percent to C$28.24. Enbridge gained 0.5 percent to C$39.96. Spartan Oil Corp., a Calgary-based oil and gas exploration company with mines in Alberta and Saskatchewan, jumped 6.1 percent to C$3.32.

Pacific Rubiales Energy Corp., a heavy crude producer with deposits in Colombia, rose 6.4 percent, the most since April 11, to C$22.44 as the company expects to receive an environmental permit that will increase its oil output. The license will allow greater water injection into wells at the onshore Rubiales field in eastern Colombia, increasing possible production to 200,000 barrels a day.

Potash Corp of Saskatchewan, the largest fertilizer producer in the world, moved up 1.7 percent to C$44.28, the highest level since April.

MacDonald Dettwiler & Associates Ltd., which made the robotic arm for NASA’s defunct space shuttle, soared 28 percent, the biggest jump ever, to C$57.25. The company bought Loral Space & Communications Inc.’s commercial satellite unit to tap growing demand for mobile entertainment and smartphones.

US

By Rita Nazareth

June 27 (Bloomberg) — U.S. stocks rose, sending the Standard & Poor’s 500 Index higher for a second day, amid better-than-estimated housing and durable goods orders data while speculation grew that China will add to economic stimulus.

Energy and financial shares rose the most in the S&P 500 among 10 groups. A gauge of homebuilders in S&P indexes climbed 3 percent to the highest since 2008. Monsanto Co., the world’s biggest seed company, added 3.9 percent as earnings beat estimates. Facebook Inc. fell 2.6 percent as analysts including those at lead underwriter Morgan Stanley said the social-network operator is worth no more than its debut price of $38.

The S&P 500 rose 0.9 percent to 1,331.85 at 4 p.m. New York time. It has risen 1.6 percent so far in June. The Dow Jones Industrial Average added 92.34 points, or 0.7 percent, to 12,627.01. Volume for exchange-listed stocks in the U.S. was 5.8 billion shares, or 14 percent below the three-month average.

“The economic data was encouraging,” said Walter Todd, who oversees about $940 million as chief investment officer of Greenwood Capital in Greenwood, South Carolina. “It’s important to see that because most recently we’ve had weaker data here and in China while Europe came back to the forefront. Any policy moves out of China would certainly be welcomed.”

Equities rallied as orders for durable goods and the number of Americans signing contracts to buy an existing home rebounded in May, easing concern the world’s largest economy is faltering.

The China Securities Journal said the country may introduce “more proactive” policies to ensure stable growth in the world’s second-largest economy. European leaders prepared for a two-day summit starting tomorrow.

Concern about a worsening of Europe’s debt crisis and a global slowdown has taken the S&P 500 down 5.4 percent this quarter. Energy and financial shares have had the biggest losses in the period, tumbling at least 9.5 percent.

Both groups jumped more than 1.2 percent for the largest increases in the S&P 500 today, with energy companies accounting for eight of the gauge’s nine biggest gains. Exxon Mobil Corp. added 1 percent to $83.20. JPMorgan Chase & Co. climbed 3 percent, the most in the Dow, to $36.78, while Bank of America Corp. had the second-biggest increase, rising 2 percent to $7.77.

Monsanto, the largest seed company, added 3.9 percent to $80.89. Sales of corn seed and genetic licenses rose 35 percent as U.S. farmers planted the biggest crop in 75 years. Soybean sales gained 15 percent, driven by demand for the newest seed engineered to tolerate Monsanto’s Roundup herbicide. Chairman and Chief Executive Officer Hugh Grant also is expanding in Latin America and Eastern Europe.

Bristol-Myers Squibb Co. gained 1.7 percent to $35.09 after the drugmaker doubled the size of its share buyback program, authorizing $3 billion in additional repurchases to be made over the “next couple years.”

Lennar Corp. rose 4.8 percent to $28.70. The homebuilder gained after a tax benefit and improving demand fueled a surge in its fiscal second-quarter profit.

Facebook slid 2.6 percent to $32.23. At least 17 securities firms began coverage of the company today, bringing the average analyst share-price estimate to $37.95, data compiled by Bloomberg show. Morgan Stanley gave Facebook the equivalent of a buy rating, as did JPMorgan Chase & Co., Goldman Sachs Group Inc. and five other firms. There were eight holds and one sell, the data show.

Facebook, its bankers and listing exchange Nasdaq OMX Group Inc. faced criticism after the shares fell below the initial public offering price of $38 on the second day of trading and extended losses to 32 percent on June 5. Underwriters sold stock at a higher valuation than every S&P 500 company except two.

“Investors probably have a right to be a little bit upset,” John Kattar, chief investment officer at Eastern Bank Wealth Management in Boston, which manages $1.7 billion, said in a telephone interview. His firm doesn’t own Facebook stock.

“The underwriters got a lot of pressure from the company to price it as high as possible. They were getting a lot of pressure from Facebook to try to extract the maximum pricing.”

DreamWorks Animation SKG Inc. surged 5 percent to $18.29.

The computer-animation studio rose after an analyst said the company’s latest film, “Madagascar 3: Europe’s Most Wanted,” was exceeding expectations.

O’Reilly Automotive Inc. tumbled 14 percent to $82.61. The retailer of auto parts, tools and accessories sank the most in more than a decade after saying sales growth was slower than expected and second-quarter profit will be on the lower end of the company’s forecast range.

Rival AutoZone Inc. sank 4.7 percent to $359.

Economic reports are due to take a turn for the better that will lift U.S. stocks, according to Binky Chadha, chief global strategist at Deutsche Bank AG.

Investors are suffering from “data disappointment” that has become extreme by historical standards, Chadha wrote in a report two days ago. “The typical pattern from here would be for fewer negative surprises and then positive ones.”

Changes in jobless claims explain 88 percent of the S&P 500’s performance during the period, according to statistical analysis cited in the report. The figure is near a 100 percent limit when two values move in lockstep.

As the relationship suggests, economic data “have been the key driver of equities,” Chadha wrote. They largely explain why stocks have retreated in the past few weeks, the New York-based strategist added. The S&P 500 has fallen as much as 9.9 percent from this year’s high, set on April 2.

Europe’s sovereign-debt crisis and slowing growth in emerging markets have contributed to the decline, the report said. Any stock-market rebound triggered by policy changes on these issues won’t last unless the economic data turn around, he wrote.

Have a wonderful evening everyone.

Be magnificent!

 

With the clouds hanging in the air above the trees,

and the birds falling silent before the storm,

this morning brings forth serious reflection,

bringing into question the entirety of existence,

the gods themselves, and all human activity.

Krishnamurti, 1895-1986

As ever,

Carolann

 

Life is half spent before we know what it is.

-George Hebert, 1593-1633

Carolann Steinhoff, B.Sc., CFP, CIM, FCSI

Senior Vice-President &

Senior Investment Advisor

Queensbury Securities Inc.,

St. Andrew’s Square

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7

 

Dear Friends,

Tangents:

I read this fascinating article in the New York Times last Sunday; thought I’d share it with you:

The Science of Illusion

By Alex Stone

PINCH a coin at its edge between the thumb and first fingers of your right hand and begin to place it in your left palm, without letting go. Begin to close the fingers of the left hand. The instant the coin is out of sight, extend the last three digits of your right hand and secretly retract the coin. Make a fist with your left — as if holding the coin — as your right hand palms the coin and drops to the side.

You’ve just performed what magicians call a retention vanish: a false transfer that exploits a lag in the brain’s perception of motion, called persistence of vision. When done right, the spectator will actually see the coin in the left palm for a split second after the hands separate.

This bizarre afterimage results from the fact that visual neurons don’t stop firing once a given stimulus (here, the coin) is no longer present. As a result, our perception of reality lags behind reality by about one one-hundredth of a second.

Magicians have long used such cognitive biases to their advantage, and in recent years scientists have been following in their footsteps, borrowing techniques from the conjurer’s playbook in an effort not to mystify people but to study them. Magic may seem an unlikely tool, but it’s already yielded several widely cited results. Consider the work on choice blindness — people’s lack of awareness when evaluating the results of their decisions.

In one study, shoppers in a blind taste test of two types of jam were asked to choose the one they preferred. They were then given a second taste from the jar they picked. Unbeknown to them, the researchers swapped the flavors before the second spoonful. The containers were two-way jars, lidded at both ends and rigged with a secret compartment that held the other jam on the opposite side — a principle that’s been used to bisect countless showgirls. This seems like the sort of thing that wouldn’t scan, yet most people failed to notice that they were tasting the wrong jam, even when the two flavors were fairly dissimilar, like grapefruit and cinnamon-apple.

In a related experiment, volunteers were shown a pair of female faces and asked which they found more attractive. Then they were given a closer look at their putative selection. In fact, the researchers swapped the selection for the “less attractive” face. Again, this bit of fraud flew by most people. Not only that, when pressed to justify their choices, the duped victims concocted remarkably detailed post hoc justifications.

Such tricks suggest that we are often blind to the results of our own decisions. Once a choice is made, our minds tend to rewrite history in a way that flatters our volition, a fact magicians have exploited for centuries. “If you are given a choice, you believe you have acted freely,” said Teller, of the duo Penn and Teller, to Smithsonian magazine. “This is one of the darkest of all psychological secrets.”

Another dark psychological secret magicians routinely take advantage of is known as change blindness — the failure to detect changes in consecutive scenes. One of the most beautiful demonstrations is an experiment conducted by the psychologist Daniel Simons in which he had an experimenter stop random strangers on the street and ask for directions.

Midway through the conversation, a pair of confederates walked between them and blocked the stranger’s view, and the experimenter switched places with one of the stooges. Moments later, the stranger was talking to a completely different person — yet strange as it may sound, most didn’t notice.

What are the neural correlates of these cognitive hiccups? One possible answer comes from studies of the so-called face test, in which a volunteer is shown two faces in quick succession. Normally, just about anyone can distinguish the faces provided they’re shown within about half a second. But if the person is distracted by a task like counting, or by a flashing light, the faces start to look the same.

Here’s where it gets interesting, though. Scientists have found a way to induce change blindness, with a machine called a transcranial magnetic stimulator, which uses amagnetic field to disrupt localized brain regions. In one experiment, a T.M.S. was used to scramble the parietal cortex, which controls attention. Subjects were then given the face test. With the machine turned off, they did fine. But when the T.M.S. was on, most failed the test. Conclusion? Misdirection paralyzes part of your cortex.

Such blind spots confirm what many philosophers have long suspected: reality and our perception of it are incommensurate to a far greater degree than is often believed. For all its apparent fidelity, the movie in our heads is a “Rashomon” narrative pieced together from inconsistent and unreliable bits of information. It is, to a certain extent, an illusion.

Alex Stone is the author of “Fooling Houdini: Magicians, Mentalists, Math Geeks and the Hidden Powers of the Mind.”

I just looked at my incoming stuff and saw a Dow Jones News Wire flash stating that one of my heroes, screenwriter Nora Ephron died a few hours ago at 71 years of age.  Ephron wrote and directed such great films as When Harry Met Sally, Silkwood, Sleepless in Seattle, You’ve Got Mail and Julie & Julia.  She wrote one of the most hilarious books I’ve ever read, I Feel Bad About My Neck.  I still have to read her latest which I have sitting at home, I Remember Nothing.

Well, as Saul Bellow said, you don’t have to visit the dead because they visit you.  Ephron will remain immortal through her brilliant creativity.

And on this day in…

1918 – The Germans begin firing their huge 420 mm howitzer, “Big Bertha,” at Paris.
1924 – After eight years of occupation, American troops leave the Dominican Republic.
1942 – The Grumman F6F Hellcat fighter flies for the first time.
1945 – The U.N. Charter is signed by 50 nations in San Francisco, California.
1963 – President John Kennedy announces “Ich bin ein Berliner” at the Berlin Wall.
1971 – The U.S. Justice Department issues a warrant for Daniel Ellsberg, accusing him of giving away the Pentagon Papers.
1975 – Indian Prime Minister Indira Gandhi is convicted of election fraud.

photos of the day June 26, 2012

A boy runs on a beach in Mogadishu, Somalia.

Goran Tomasevic/Reuters

A pelican hangs out at the port city of Sidon, Lebanon. A small number of pelicans live in the port where fishermen feed and take care of them.

Ali Hashisho/Reuters

Market Closes for June 26, 2012:

North American Markets

Market  Index	Close	Change
Dow  Jones	12534.67	+32.01
		+0.26%
S&P 500	1319.99	+6.27
		+0.48%
NASDAQ	2854.06	+17.90
		+0.63%
TSX	11334.42	+4.03
		+0.04%

International Markets

Market  Index	Close	Change
NIKKEI	8663.99	-70.63
		-0.81%
HANG  SENG	18981.84	+84.39
		+0.45%
SENSEX	16906.58	+24.42
		+0.14%
FTSE 100	5446.96	-3.69
		-0.07%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	1.747	1.730
CND.   30 Year Bond	2.324	2.300
U.S.   10 Year Bond	1.6297	1.6058
U.S.   30 Year Bond	2.7007	2.6801

Currencies

BOC Close	Today	Previous
Canadian $	1.02431	1.02935
US   $	0.97626	0.97149
Euro Rate  1 Euro=		Inverse
Canadian   $	1.27952	0.78154
US  $	1.24915	0.80054

Commodities

Gold	Close	Previous
London Gold   Fix	1572.88	1571.50
Oil	Close	Previous
WTI Crude Future	79.36	79.01
BRENT	92.37	90.93

Market Commentary:

Canada

By Katia Dmitrieva

June 26 (Bloomberg) — Most Canadian stocks retreated as the fourth decline in five days by raw-material companies amid concern about the European debt crisis overshadowed gains by financial shares.

Gold companies in the Standard & Poor’s/TSX Composite Index plunged 2.4 percent, extending their loss since June 18 to 8 percent. SouthGobi Resources Ltd. tumbled 25.9 percent, the most since 2008. Sun Life Financial Inc. and Manulife Financial Corp. helped lead the industry’s rally, climbing at least 1.9 percent.

In the S&P/TSX, 132 companies declined and 108 advanced.

The index advanced 4.03 points, or less than 0.1 percent, to 11,334.42 after losing as much as 0.7 percent earlier. The index has fallen 1.6 percent in June, heading for a fourth straight monthly decline.

“The focus continues to be the macroeconomic and that remains with Europe,” Jeffrey Bradacs, whose team at Manulife Asset Management manages C$1.7 billion, said in a phone interview. “The issues in Europe continue to weigh on the markets and that continues to weigh on risk-based names and commodity-based names.”

Concern over the European debt crisis intensified today as Spanish and Italian bonds fell and the euro weakened as borrowing costs increased at debt sales. Canadian stocks fell yesterday, sending the benchmark index to the lowest level since May 18, on concern European leaders may fail to calm the debt crisis during a summit this week. German Chancellor Angela Merkel reiterated her opposition to a shared debt burden in the region.

Potash Corp. of Saskatchewan Inc., the largest fertilizer producer, gained 3.1 percent to C$43.53 as corn climbed to the highest level in more than nine months on speculation that hot, dry weather during the next two weeks will reduce yields in the U.S., the world’s largest grower.

Barrick Gold Corp., the world’s largest producer, fell 4 percent to C$37.83 as gold declined for the first time in three sessions.

SouthGobi fell 26 percent to C$4. The company cut output as prices and customer purchases declined and the company awaits a regulatory notification on a plan by Aluminum Corp. of China Ltd. to acquire the Mongolian coal producer.

US

By Rita Nazareth

June 26 (Bloomberg) — U.S. stocks advanced, rebounding from yesterday’s selloff, as optimism about the housing market tempered concern about a worsening of Europe’s debt crisis.

News Corp. rose 8.3 percent as Rupert Murdoch’s company said it’s considering splitting into two publicly held corporations. Apollo Group Inc., the largest U.S. for-profit college chain, surged 10 percent after beating earnings and revenue estimates and raising its forecast. A measure of homebuilders in Standard & Poor’s indexes jumped 3.8 percent as housing prices dropped at the slowest pace in more than a year.

The S&P 500 rose 0.5 percent to 1,319.99 at 4 p.m. New York time. It tumbled 1.6 percent yesterday. The Dow Jones Industrial Average increased 32.01 points, or 0.3 percent, to 12,534.67.

Volume for exchange-listed stocks in the U.S. was about 6 billion shares, or 12 percent below the three-month average.

“There are lots of variables at play,” said Keith Wirtz, who oversees $15 billion as chief investment officer for Fifth Third Asset Management in Cincinnati. He spoke in a phone interview. “People are looking at signs of stabilization in the housing market, there’s the European summit this week, it’s almost quarter end. It’s going to be a volatile week.”

Today’s rally trimmed this quarter’s decline in the S&P 500 to 6.3 percent. The benchmark measure is on pace for the first quarterly slump since September amid concern about a global economic slowdown. Energy, financial and technology shares have had the biggest losses so far in the second quarter, tumbling at least 9.5 percent.

Equities rose today as the S&P/Case-Shiller index of property values in 20 cities dropped 1.9 percent in April from the same month in 2011, the smallest decline since November 2010, after decreasing 2.6 percent in the year ended March. The data overshadowed a surge in yields at auctions in Italy and Spain ahead of a European Union summit on June 28.

“We’re caught in this limbo,” said Brian Jacobsen, who helps oversee $204 billion as chief portfolio strategist at Wells Fargo Advantage Funds in Menomonee Falls, Wisconsin.

“People are waiting to see what comes out of the European Union summit this week.”

Consumer discretionary, energy and financial shares had the biggest gains among the 10 main S&P 500 industries. Homebuilders in S&P indexes advanced with PulteGroup Inc. and Lennar Corp. adding more than 3 percent.

News Corp. rallied 8.3 percent to $21.76, the highest level since 2007. Murdoch, the chairman and CEO, is overseeing internal discussions on whether to separate the company’s publishing business from its entertainment holdings, said two people with knowledge of the matter. In a statement today, News Corp. didn’t say how the company would be divided.

Apollo advanced 10 percent to $35.81 for the largest gain in the Bloomberg U.S. For-Profit Education Index. The company, confronting student reluctance to take on debt amid high unemployment and government investigations of for-profit colleges’ marketing practices, reined in costs during the quarter, said Peter Appert, an analyst at Piper Jaffray & Co.

JPMorgan Chase & Co. had its recommendation raised and Morgan Stanley was lowered by analysts at Goldman Sachs Group Inc., who said they have a better view of the near-term earnings outlook for JPMorgan. Shares of JPMorgan increased 1.1 percent to $35.71, while Morgan Stanley added 0.2 percent to $13.51.

Goldman Sachs upgraded JPMorgan to a buy on its “Americas conviction list” of highly recommended stocks, while Morgan Stanley was removed from that list and lowered to neutral, the analysts wrote in a research note today.

“Both JPM and MS shares have underperformed the broader banking group this year, driven by real but different idiosyncratic concerns,” Goldman Sachs analysts led by Richard Ramsden wrote, referring to the two company’s stock symbols. The balance of risk and potential return is better for JPMorgan shareholders, according to the note, because of “more near-term earnings and return visibility for JPM.”

Facebook Inc., facing criticism for a lack of diversity on its board, appointed Chief Operating Officer Sheryl Sandberg as its first female director. The world’s largest social-networking service, a majority of whose users are women, will benefit from the addition of a female voice to its board, said Laura Martin, an analyst at Needham & Co.

“This is a great move,” said Martin, who doesn’t own shares and rates the stock a buy. “Academic research shows that the greater the diversity on a board, the higher the returns to shareholders are.”

The shares rose 3.2 percent to $33.10.

Dow Chemical Co. slid 2.9 percent to $31.32. The largest U.S. chemical company by revenue was downgraded to neutral from overweight at JPMorgan by equity analyst Jeffrey Zekauskas. The 18-month share-price estimate is $36.

The S&P 500, down 7.4 percent through yesterday since reaching a four-year high in April on weakening economic data, is about to lose another pillar of support: the election year calendar.

The gauge has climbed an average of 0.1 percent in third quarters before a presidential vote in election cycles since 1945, the worst return of the year and down from an average increase of 2.2 percent between April and June, according to S&P. U.S. shares have returned 5.7 percent in election years since World War II, the second-worst performance during four- year executive branch terms.

Stocks have retreated following a rally in the first quarter, dragged down after reports on U.S. manufacturing and employment trailed economist forecasts and concern grew that Europe’s debt crisis will spur a global recession.

The S&P 500 dropped 8.9 percent in the July-September quarter of 2008 as the financial crisis intensified. It has rebounded 1.9 percent on average in quarters after elections, S&P’s data show.

“This lack of direction is understandable, in our opinion, as investors are bombarded by the hype from the conventions, speeches and political advertisements, as they await the outcome of the upcoming election,” Sam Stovall, S&P’s chief equity strategist, wrote in a note yesterday.

While the index posts an average gain during the third quarter of election years, it’s just as likely to rise as fall, according to S&P. Its lowest point during years of presidential votes have come in the first half 71 percent of the time, the data shows. The most consistent gains come in the final quarter, when the gauge has climbed 81 percent of the time.

Only twice out of the 17 election years since 1944 did the index bottom in the fourth quarter, in 2000 and 2008, when the market suffered the bursting of Internet and housing bubbles, respectively. President Barack Obama, a Democrat, is seeking a second term against Republican candidate Mitt Romney on Nov. 6.

Have a wonderful evening everyone.

Be magnificent!

 

The outward freedom that we shall attain will only be in exact proportion

to the inward freedom to which we may have grown at any given moment.

Mahatma Gandhi, 1869-1948

As ever,

Carolann

 

Prosperity is a great teacher,

adversity a greater.

-William Hazlitt, 1778-1830

Carolann Steinhoff, B.Sc., CFP, CIM, FCSI

Senior Vice-President &

Senior Investment Advisor

Queensbury Securities Inc.,

St. Andrew’s Square

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7

 

Tel: 778.430.5808

(C): 250.881.0801

Toll Free: 1.877.430.5895

Fax: 778.430.5838

www.carolannsteinhoff.com

 

 

 

Dear Friends,

Tangents:

A thoughtful and timely article that appeared in a recent edition of the Wall Street Journal:

10 Things Your Commencement Speaker Won’t Tell You

-By Charles Wheelan

1. Your time in fraternity basements was well spent. The same goes for the time you spent playing intramural sports, working on the school newspaper or just hanging with friends.  Research tells us that one of the most important causal factors associated with happiness and well-being is your meaningful connections with other human beings.  Look around today.  Certainly one benchmark of your postgraduation success should be how many of these people are still your close friends in 10 or 20 years.

2. Some of your worst days lie ahead. Graduation is a happy day.  But my job is to tell you that if you are going to do anything worthwhile, you will face periods of grinding self-doubt and failure.  Be prepared to work through them.  I’ll spare you my personal details, other than to say that one year after college graduation I had no job, less thatn$500 in assets , and I was living with an elderly retired couple.  The only difference between when I graduated and today is that now no one can afford to retire.

3. Don’t make the world worse. I know that I’m supposed to tell you to aspire to great things.  But I’m going to lower the bar here: Just don’t use your prodigious talents to mess things up.  Too many smart people are doing that already.  And if you really want to cause social mayhem, it helps to have an Ivy League degree.  You are smart and motivated and creative.  Everyone will tell you that you can change the world.  They are right, but remember that “changing the world” also can include things like skirting financial regulations and selling unhealthy foods to increasingly obese children.  I am not asking you to cure cancer.  I am just asking you not to spread it.

4. Marry someone smarter than you are. When I was getting a Ph.D., my wife Leah wanted to start a software company.  I had  a job with health benefits.  (To clarify, having a “spouse with benefits” is different from having a “friend with benefits.”)  You will do better in life if you have  a second economic oar in the water.  I also want to alert you to the fact that commencement is like shooting smart fish in a barrel.  The summa cum laude graduates have their names printed in the program.  Seize the opportunity!

5. Help stop the Little League arms race. Kids’ sports are becoming ridiculously structured and competitive.  What happened to playing baseball because it’s fun?  We are systematically creating races out of things that ought to be a journey.  We know that success isn’t about simply running faster than everyone else in some predetermined direction.  Yet the message we are sending from birth is that if you don’t make the traveling soccer team or get into the “right” school, then you will somehow finish life with fewer points than everyone else.  That’s not right.  You’ll never read the following obituary:  “Bob Smith died yesterday at the age of 74.  He finished life in 186^th place.”

6. Read obituaries. They are just like biographies, only shorter.  They remind us that interesting, successful people rarely lead orderly, linear lives.

7. Your parents don’t want what is best for you. They want what is good for you, which isn’t always the same thing.  There is a natural instinct to protect our children from risk and discomfort, and therefore to urge safe choices.  Theodore Roosevelt – soldier, explorer, president – once remarked, “It is hard to fail, but it is worse never to have tried to succeed.”  Great quote, but I am willing to bet that Teddy’s mother wanted him to be a doctor or a lawyer.

8. Don’t model your life after a circus animal.  Performing animals do tricks because their trainers throw them peanuts or small fish for doing so.  You should aspire to do better.  You will be a friend, a parent, a coach, an employee – and so on.  But only in your job will you be explicitly evaluated and rewarded for your performance.  Don’t let your life decisions be distorted by the fact that your boss is the only one tossing you peanuts.  If you leave a work task undone in order to meet a friend for dinner, then you are “shirking” your work.  But it’s also true that if you cancel dinner to finish your work, then you are shirking your friendship.  That’s just not how we usually think of it.

9. It’s all borrowed time. You shouldn’t take anything for granted, not even tomorrow.  I offer you the “hit by bus” rule.  Would I regret spending my life this way if I were to get hit by a bus next week or next year?  And the important corollary:  Does this path lead to a life I will be happy with and proud of in 10 or 20 years if I don’t get hit by a bus.

10. Don’t try to be great. Being great involves luck and other circumstances beyond your control.  The less you think about being great, the more likely it is to happen.  And if it doesn’t, there is absolutely nothing wrong with being solid.

Adapted from 10 ½ Things No Commencement Speaker Has Ever Said, by Charles Wheelan, W.W. Norton & Co., 2012.

And on this day in…

1903 – Geoge Orwell was born

1903 – Marie Curie announces her discovery of radium.

1945 – Carly Simon was born.
1946 – Ho Chi Minh travels to France for talks on Vietnamese independence.
1948 – The Soviet Union tightens its blockade of Berlin by intercepting river barges heading for the city.
1950 – North Korea invades South Korea, beginning the Korean War.
1973 – White House Counsel John Dean admits President Nixon took part in the Watergate cover-up.
1986 – Congress approves $100 million in aid to the Contras fighting in Nicaragua.

photos of the day June 25, 2012

Canada’s Governor General David Johnston talks with a member of the Ceremonial Guard while performing the annual inspection at Rideau Hall in Ottawa.

Chris Wattie/Reuters

Construction workers Canny Conca (l.) and Brian Shelley unfurl an American flag attached to the final steel beam to be installed on 4 World Trade Center during a ceremony to mark its installation in New York.

Keith Bedford/Reuters

Market Closes for June 25, 2012:

North American Markets

Market Index	Close	Change
Dow Jones	12502.66	-138.12
		-1.09%
S&P 500	1314.35	-20.67
		-1.55%
NASDAQ	2836.16	-56.26
		-1.95%
TSX	11324.04	-111.50
		-0.98%

International Markets

Market Index	Close	Change
NIKKEI	8734.62	-63.73
		-0.72%
HANG SENG	18897.45	-97.68
		-0.51%
SENSEX	16882.16	-90.35
		-0.53%
FTSE 100	5450.65	-63.04
		-1.14%

Bonds

Bonds	% Yield	Previous % Yield
CND. 10 Year Bond	1.730	1.805
CND. 30 Year Bond	2.300	2.355
U.S. 10 Year Bond	1.6058	1.6742
U.S. 30 Year Bond	2.6801	2.7586

Currencies

BOC Close	Today	Previous
Canadian $	1.02935	1.02446
US $	0.97149	0.97615
Euro Rate 1 Euro=		Inverse
Canadian $	1.28698	0.77701
US $	1.25029	0.79981

Commodities

Gold	Close	Previous
London Gold Fix	1571.50	1571.50
Oil	Close	Previous
WTI Crude Future	79.01	79.36
BRENT	90.93	90.75

Market Commentary:

Canada

By Katia Dmitrieva

June 25 (Bloomberg) — Canadian stocks fell, sending the benchmark index to a five-week low, as Morgan Stanley cut its rating on Research In Motion Ltd. and oil slid on concern European leaders may fail to calm the debt crisis.

RIM tumbled 7.5 percent after Morgan Stanley cited “rapidly deteriorating fundamentals” at the BlackBerry maker.

The three largest energy providers in Canada, Suncor Energy Inc., Imperial Oil Ltd. and Canadian Natural Resources Ltd., dropped at least 1.2 percent as oil traded below $80 a barrel for a third day.

The Standard & Poor’s/TSX Composite Index decreased 105.15 points, or 0.9 percent, to 11,330.39. The index has fallen 1.6 percent in June, heading for a fourth straight month of losses.

“It’s a very negative sentiment when it comes to Europe,”

Jeff Parent, who manages more than $100 million at Toronto-based Quadrexx Asset Management Inc., said in a phone interview. “Oil will be sold off as a result.”

Failure by leaders at the summit to come up with measures to shore up the weakest countries may be “fatal” for the euro, billionaire investor George Soros said yesterday.

Energy and financial stocks contributed most to the drop in the S&P/TSX out of 10 industries. Among stocks in the gauge, 190 declined and 48 gained.

Research In Motion declined 7.5 percent to C$9.36, the lowest level since October 2003.

“The only way RIM remains a viable entity is at a fraction of its current size, a transformation that erases much of its earnings power,” Ehud Gelblum, an analyst at Morgan Stanley in New York, wrote in a note to investors today.

Suncor Energy, the nation’s largest oil provider, declined 1.9 percent to C$27.72. Imperial Oil, the second-largest, slipped 1.4 percent to C$40.24. Canadian Natural Resources lost 1.2 percent to C$26.68.

Oil for August delivery declined 0.7 percent to $79.21 a barrel on the New York Mercantile Exchange. Brent oil rose 3 cents to $91.01 a barrel. Brent crude dropping to $70 dollars a barrel may be a “real possibility,” Citigroup Inc. chief technical analyst Tom Fitzpatrick wrote in a note.

Gold futures climbed the most in three weeks as European debt concerns mounted, spurring demand for the metal as a hedge.

The metal rose 1.4 percent to $1,588.40 an ounce on the Comex in New York.

Barrick Gold Corp., the world’s largest gold producer, added 1.5 percent to C$39.42. Centerra Gold Inc. rose 3.2 percent to C$8.99, snapping a three-day loss.

US

By Rita Nazareth

June 25 (Bloomberg) — U.S. stocks tumbled on concern this week’s European Union summit will fail to tame a crisis which put American earnings on pace for the first decline since 2009.

Technology, financial and energy shares dropped the most among 10 groups in the Standard & Poor’s 500 Index. Bank of America Corp. and Chesapeake Energy Corp. slumped at least 4.2 percent. Microsoft Corp. sank 2.7 percent after agreeing to acquire Yammer Inc. for $1.2 billion in cash. Constellation Brands Inc. surged 13 percent as it may benefit from a potential deal between Grupo Modelo SAB and Anheuser-Busch InBev NV.

The S&P 500 slid 1.6 percent to 1,313.72 at 4 p.m. New York time as 470 of its 500 stocks declined. The Dow Jones Industrial Average fell 138.12 points, or 1.1 percent, to 12,502.66. Volume for exchange-listed stocks in the U.S. was about 5.9 billion shares, or 13 percent below the three-month average.

“There are reasons for investors to be concerned,” Stephen Wood, the New York-based chief market strategist for Russell Investments, said in a telephone interview. His firm oversees $140.8 billion. “In addition to the ongoing wounds of Europe, we’ll begin to see softness in corporate earnings.”

Equities slumped as Chancellor Angela Merkel hardened her resistance to euro-area debt sharing, setting Germany on a collision course with its allies at a summit on June 28. Cyprus said it will seek a financial lifeline from the euro area’s firewall funds. Greek Prime Minister Antonis Samaras consented to the resignation of his finance minister, Vassilios Rapanos.

Billionaire investor George Soros warned that a failure by leaders meeting this week to produce drastic measures could spell the demise of the currency.

“There is a disagreement on the fiscal side,” Soros, 81, said in an interview with Bloomberg Television’s Francine Lacqua at his home in London. “Unless that is resolved in the next three days, then I am afraid the summit could turn out to be a fiasco. That could actually be fatal.”

Europe’s debt crisis is putting pressure on corporate results. Analysts predict members of the S&P 500 will report a 1.1 percent average drop in second-quarter earnings, after estimating a gain as recently as last month, according to data compiled by Bloomberg. That would follow a 6.2 percent average increase in the first quarter.

Earnings pessimism reached levels last seen during the financial crisis. Fifty-nine corporations issued profit projections that trailed analyst estimates during the 20 days through June 22, or 3.1 times the number of those that exceeded them. The ratio has been greater than 3 for eight straight days, the longest stretch in three years. It was at least that high the majority of the time between October 2008 and April 2009, climbing to 11.5 in December 2008, the data show.

“There is a lot of trepidation about second-quarter earnings,” Tim Ghriskey, chief investment officer of Solaris Group in Bedford Hills, New York, said in a June 22 interview.

He oversees about $2 billion. “You are very unlikely to see companies coming out with favorable outlooks given the problems in Europe and the slowing growth in the U.S. and China.”

Alcoa Inc., traditionally the first company in the Dow to report quarterly earnings, is scheduled to release its second- quarter figures on July 9.

All 10 groups in the S&P 500 fell as technology, financial and energy shares dropped at least 1.8 percent. The Morgan Stanley Cyclical Index of companies most-tied to the economy slumped 2.6 percent even as data showed demand for new homes rose more than forecast. Bank of America slid 4.3 percent to $7.60. Chesapeake Energy retreated 8.5 percent to $17.03.

Microsoft dropped 2.7 percent to $29.87. San Francisco- based Yammer provides features — similar to those found on Facebook Inc. — to more than 200,000 companies such as Ford Motor Co. and EBay Inc. It will become part of Microsoft’s Office division and the team will continue to report to current Yammer Chief Executive Officer David Sacks.

Facebook, the biggest social-networking operator, decreased 3 percent to $32.06. The decline followed a 22 percent advance over the previous two weeks.

Pfizer Inc. fell 1.1 percent to $22.47, while Bristol-Myers Squibb Co. sank 3.5 percent to $34.13. The companies failed to gain approval of the blood thinner Eliquis from U.S. regulators, who said they needed more data on the treatment.

Sprint Nextel Corp. slipped 6.1 percent to $3.09. The third-biggest U.S. wireless carrier declined amid concern over the management of its fourth-generation network expansion.

GeoEye Inc. tumbled 22 percent, the biggest decline since 2004, to $14.24. The provider of satellite imagery said a federal agency may scale back a $3.8 billion contract.

Constellation surged 13 percent to $21.86. The world’s largest winemaker gained the most in almost a decade as Anheuser-Busch InBev seeks to acquire the rest of Corona maker Grupo Modelo in a deal that a person familiar with the talks said could bring a payment to Constellation.

Quest Software Inc. jumped 5.6 percent to $27.70. The software maker that agreed to be bought by a group led by Insight Venture Partners said it has received a higher offer of $27.50 a share in cash.

Newmont Mining Corp., the largest U.S. gold producer, advanced 1.7 percent to $48.79. Gold futures gained the most in three weeks as Europe’s debt concern spurred demand for the metal as a hedge.

Fertilizer producers rallied after Dahlman Rose & Co. raised its recommendation for the industry. CF Industries Holdings Inc. increased 3.4 percent to $183.66. Mosaic Co. gained 1 percent to $51.10.

At a time of record fuel demand, bountiful oil and natural gas, and expanding economies, no stocks are doing worse in the world than energy producers from BP Plc to Hess Corp.

The MSCI World Energy Index has declined 9.6 percent this year through last week, more than any other group, according to data compiled by Bloomberg. The gauge has climbed 45 percent since equities bottomed in 2009, less than any industry with earnings tied to economic growth. In the U.S., the stocks are at the cheapest levels relative to the S&P 500 since 2009.

The divergence reflects the transformation of an industry where growing consumption of energy has been met with even bigger gains in supply. U.S. crude inventories are the highest since 1990 and natural gas prices have lost 38 percent in 12 months amid a glut spurred by hydraulic fracturing. Bears say energy producers, making up about 10 percent of global stocks, will keep equities from advancing. Bulls say the market will rally when their shares rebound.

“The S&P 500 will have a tough time making meaningful progress until the energy sector bottoms and begins to move higher,” Jim Russell, the Cincinnati-based chief equity strategist at U.S. Bank Wealth Management, which oversees about $116 billion, said in a phone interview on June 20. “Even though the valuations of the stocks are cheap, the fundamentals have not yet bottomed.”

Have a wonderful evening everyone.

Be magnificent!

 

Wise people are concerned only with what lies behind all these things.

Just as bees fly from one blossom to another, looking only for the essence of each one,

wise people look only for the essence of every person they meet.

Wise people, who know and understand the soul, are indifferent to both pleasure and pain;

they have risen above sensations.  They are indifferent to the past and the future, they have risen above time.

They are indifferent to danger; they have risen above fear.

Wise people know that what is here, is also there;

that what was, will also be.

They see unity, not division.

Katha Upanishad

As ever,

Carolann

 

Here is the test to find whether your mission

on Earth is finished: if you’re alive, it isn’t.

-Richard Bach, 1936-

Carolann Steinhoff, B.Sc., CFP, CIM, FCSI

Senior Vice-President &

Senior Investment Advisor

Queensbury Securities Inc.,

St. Andrew’s Square

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7

 

Dear Friends,

Tangents:

One of the things I derive great enjoyment from this time of year is reading the commencement speeches for the various graduating classes.  Here are a few excerpts from speeches for the class of 2012:

Michael Lewis, Author

Princeton University

“People really don’t like to hear success explained away as luck, especially successful people.  As they age, and succeed, people feel their success was somehow inevitable.  They don’t want to acknowledge the role played by accident in their lives….Recognize that if you have had success, you have also had luck, and with luck comes obligation.  You owe a debt, and not just to your gods.  You owe a debt to the unlucky.”

Cory A. booker, Mayor of Newark

Bard College

“Go out there and swear to this world your oath, not with your words, but with what you do.  Not with your hand over your heart, but with your hand outstretched to a world that desperately needs your hand, your help, your insights, your creativity, your honor, your courage.  It needs you.”

Neil Gaiman, Author

University of the Arts

“Things go wrong, in life and in love and in business and in friendship and in health and in all the other ways that life can go wrong.  And when things get tough, this is what you should do: make good art.  I’m serious.  Husband runs off with a politician?  Make good art.  Leg crushed and then eaten by mutated boa constrictor?  Make good art.  I.R.S. on your trail?  Make good art.  Cat exploded?  Make good art.  Somebody on the Internet thinks what you do is stupid or evil, or it’s all been done before?  Make good art.”

Atul Gawande, Physician and author

Williams College

“There continue to be huge differences between hospitals in the outcomes of their care….I thought that the best places simply did a better job at controlling and minimizing risks, that they did a better job of preventing things from going wrong.  But to my surprise, they didn’t.  Their complication rates after surgery were almost the same as others.  Instead, what they proved to be really great at was rescuing people when they had a complication, preventing failures from becoming a catastrophe….They call them a ‘Failure to Rescue.’  More than anything, this is what distinguished the great from the mediocre.  They didn’t fail less.  They rescued more.  This in fact may be the real story of human and societal improvement.  Risk is necessary.”

And on this day in…

1933 – Hitler bans political parties in Germany other than the Nazis.
1938 – Joe Louis floors Max Schmeling in the first round of the heavyweight bout at Yankee Stadium.
1940 – France and Germany sign an armistice at Compiegne, on terms dictated by the Nazis.
1941 – Under the codename Barbarossa, Germany invades the Soviet Union.
1942 – A Japanese submarine shells Fort Stevens at the mouth of the Columbia River.
1944 – President Franklin Roosevelt signs the “GI Bill of Rights” to provide broad benefits for veterans of the war.

1949 – Meryl Streep was born.
1956 – The battle for Algiers begins as three buildings in Casbah are blown up.
1973 – Skylab astronauts splash down safely in the Pacific after a record 28 days in space.
1980 – The Soviet Union announces a partial withdrawal of its forces from Afghanistan.
1981 – Mark David Chapman pleads guilty to killing John Lennon.

photos of the day June 22, 201

A worker checks the lights of the installation ‘P.V.R. Neon’ (2006) of German artist Sven Druehl in the exhibition ‘Landscapes as a World View’ in the Kunstsammlungen gallery in Chemnitz, eastern Germany. The exhibition starts on June 24 and lasts until Aug. 26.

Jens Meyer/AP

A youth practices parkour as he jumps off a wall in central Sydney, Australia. Parkour is a method of movement, originally from France, whose practitioners use techniques of vaulting, rolling, running, climbing and jumping to leap over or move around obstacles.

Daniel Munoz/Reuters

The one-year-old cub of a red-handed tamarin monkey sits on his mother at the Royev Ruchey zoo in Russia’s Siberian city of Krasnoyarsk.

Ilya Naymushin/Reuters

Market Closes for June 22, 2012:

North American Markets

Market  Index	Close	Change
Dow  Jones	12640.78	+67.21
		+0.53%
S&P 500	1335.02	+9.51
		+0.72%
NASDAQ	2892.42	+33.33
		+1.17%
TSX	11435.54	+27.22
		+0.24%

International Markets

Market  Index	Close	Change
NIKKEI	8798.35	-25.72
		-0.29%
HANG  SENG	18995.13	-269.94
		-1.40%
SENSEX	16972.51	-60.05
		-0.35%
FTSE 100	5513.69	-52.67
		-0.95%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	1.805	1.752
CND.   30 Year Bond	2.355	2.319
U.S.   10 Year Bond	1.6742	1.6179
U.S.   30 Year Bond	2.7586	2.6861

Currencies

BOC Close	Today	Previous
Canadian $	1.02446	1.02882
US   $	0.97615	0.97198
Euro Rate  1 Euro=		Inverse
Canadian   $	1.28780	0.77652
US  $	1.25709	0.79549

Commodities

Gold	Close	Previous
London Gold   Fix	1571.50	1566.27
Oil	Close	Previous
WTI Crude Future	79.36	77.84
BRENT	90.75	88.91

Market Commentary:

Canada

By Katia Dmitrieva

June 22 (Bloomberg) — Canadian stocks rose as gains in banks and energy shares overshadowed falling mining companies and helped the benchmark index recover from its biggest decline since October.

Suncor Energy Inc., the nation’s largest oil provider, and Royal Bank of Canada, its biggest lender, rose at least 1.3 percent. As a group, banking and energy stocks contributed most to gains in the Standard & Poor’s/TSX Composite Index, while raw-materials shares fell the most. Centerra Gold Inc. tumbled 27 percent, its biggest slide since 2008, after disputing allegations by Kyrgyzstan that it caused environmental damage.

The S&P/TSX increased 14.07 points, or 0.1 percent, to 11,422.39 at 3:34 p.m. in Toronto, after gaining as much as 0.6 percent and falling 0.2 percent. Canadian shares lost 3 percent yesterday, the most among 24 developed nations tracked by Bloomberg.

“It’s a battle between risk-on and risk-off,” David Sherlock of Calgary-based McLean & Partners, which manages C$1 billion, said in a phone interview. “It’s a really precarious situation. You’ve got monetary policies that should be supportive of the markets and then you have the problems that caused these actions, and those aren’t solved.”

The stock index has slumped 0.9 percent this week as reports yesterday showed a slowdown in global manufacturing, while the U.S. Federal Reserve cut its forecasts for economic growth. The central bank also extended its stimulus program known as Operation Twist by $267 billion, disappointing investors anticipating a more aggressive approach.

Energy stocks rose today after two straight losses, as oil prices climbed from an eight-month low. Suncor added 1.8 percent to C$28.20. Canadian Natural Resources Ltd., the nation’s third- largest provider, jumped 1 percent to C$26.87.

Financial stocks rose as Moody’s Investors Service as 15 global bank downgrades from Moody’s Investors Service were no worse than the credit-rating firm had warned. Royal Bank of Canada gained 1.5 percent to C$52.10. Toronto-Dominion Bank advanced 0.6 percent to C$78.84.

Royal Bank, Canada’s largest lender by assets, was downgraded to Aa3 from Aa1, Moody’s second-highest level, as part of the review. It was the second downgrade for the bank in 18 months and puts Royal Bank’s credit rating from Moody’s lower than Canada’s other big banks.

“RBC remains one of the strongest and highest-rated banks in the world in terms of our credit ratings, capital base and balance sheet,” Katherine Gay, a spokeswoman for Royal Bank, said in an interview. “We expect minimal impact on our business and no impact on our clients.”

Gold futures added 0.1 percent, rebounding from a 0.4 percent decline. The price had slumped four straight days.

Barrick Gold Corp., the world’s largest provider of the metal, fell 2.3 percent to C$38.59.

Gold stocks in the S&P/TSX slumped 5.4 percent this week.

Jennifer Radman of Caldwell Investment Management Ltd., which manages C$1 billion, said in a phone interview that the decline was a reaction to this week’s meeting of Fed policy makers including Chairman Ben S. Bernanke.

“There was some expectation that Bernanke would announce further quantitative easing and it just didn’t happen,” she said. “A lot of that expectation was pushed to the market and now gold is trading off that lack of news. Nobody is buying the gold stocks at all.”

Centerra Gold plunged 29 percent to C$3.38. It said Kyrgyzstan issued a report on June 18 that “included claims of substantial environmental damage” from the company’s Kumtor mine.

“Centerra believes that the report’s findings are without merit,” the company said in a statement.

US

By Rita Nazareth

June 22 (Bloomberg) — U.S. stocks advanced, following yesterday’s global selloff, as bank downgrades from Moody’s Investors Service were no worse than the firm had warned.

The Standard & Poor’s 500 Index added 0.8 percent to 1,335.46 at 4 p.m. New York time. The benchmark measure tumbled 2.2 percent yesterday for the second-biggest loss this year.

“The bad news is out and it was not as bad as expected,” said Jeffrey Saut, chief investment strategist at Raymond James & Associates in St. Petersburg, Florida. His firm oversees $350 billion. “They had been telegraphing the bank downgrades for a long time. Why does anybody pay any attention to those rating companies? They missed it during the financial crisis.”

The prospect of downgrades had weighed on the financial industry since Moody’s said Feb. 15 it was reviewing 17 banks with capital-markets operations because of fragile confidence and tighter regulations that pinched revenue. Pressure mounted as Europe’s debt crisis intensified.

The reductions by Moody’s are “a mea culpa from 2007 and 2008,” said James Leonard, a credit analyst at Morningstar Inc.

“The banks have gotten so much better in the last few years in terms of capital, yet their ratings keep going down. What does that tell you? That the ratings were so wrong before.”

Equities tumbled yesterday, while commodities entered a bear market, after signals of a global slowdown in manufacturing added to disappointing housing and labor market data at the world’s largest economy. The reports came out a day after the Federal Reserve lowered its growth and employment estimates while signaling it may add to its record stimulus.

Investors also watched news out of Europe. The euro strengthened against the dollar after the European Central Bank eased terms for collateral, boosting speculation the central bank will announce a third set of long-term loans. Spanish policy makers are considering forcing investors who hold equity and junior debt in banks to absorb losses in a restructuring, according to a person with knowledge of the plan.

“Time is running out,” said Brad Sorensen, director of market and sector analysis at San Francisco-based Charles Schwab Corp. His firm has $1.76 trillion in client assets. “These tiny things may buy them a little time. They’re just very small measures compared to the problems that they have over there.”

Equities rose today as JPMorgan Chase & Co. paced a rally in banks following a downgrade by Moody’s Investors Service that was no worse than the credit-rating firm had warned.

Energy producers lost the most in the S&P 500 for the week, sinking 3.3 percent as economic reports added to signs of a global slowdown.

For the week, Procter & Gamble Co. slid 4.9 percent and Bed Bath & Beyond Inc. tumbled 16 percent after disappointing profit forecasts.

Facebook Inc. jumped 10 percent for its second weekly advance.

Ryder System Inc. slumped 16 percent to $35.44 for the biggest retreat in the S&P 500. The truck leasing company cut its full-year earnings forecast because of lower demand for commercial rentals.

FedEx Corp. gained 3.3 percent to $90.54. The operator of the world’s largest cargo airline climbed after pledging “significant cost reductions.” Executives said revenue and earnings growth will be impacted by “weaker economic conditions” such as the European debt crisis, and slowing growth in Asia.

Facebook climbed 10 percent to $33.05 as Nomura Holdings Inc. rated the social-network operator a buy in new coverage.

“Facebook’s industry-leading reach, engaged user base, and comprehensive user dataset will enable the company to continue to grow and take share in the display market,” Brian Nowak, a New York-based analyst with Nomura, wrote in a note.

The company has climbed 28 percent since its low on June 5, as it unveiled new products and services, and capped its first weekly gain on June 15. Concern Facebook was overvalued and that the company will struggle to increase revenue fast enough pushed the stock down as much as 32 percent from its IPO price of $38 on May 17.

Microsoft Corp. added 2.3 percent to $30.70. The world’s largest software maker unveiled its own Windows-powered tablet computer called Surface in a renewed attempt to take on Apple Inc.’s iPad.

First Solar Inc. surged 14 percent, the most in the S&P 500, to $15.88. The biggest maker of thin-film solar panels received permission to continue construction on a $1.36 billion power project in Los Angeles County.

Have a wonderful weekend everyone.

Be magnificent!

 

When the mind and intellect developed, man asked,

Who am I?  Who is it before me?

The search for reality began…

Moving one step towards finding the answer to the question,

Who am I, we brought consciousness from the outside to inside.

Wisdom turned the direction of the consciousness within and

we perceived our soul.

The journey of the soul in the outer world was over and the journey within had begun.

-Acharya Mahaprajna, 1920-2010

As ever,

Carolann

You can’t build a reputation on what you are going to do.

-Henry Ford, 1863-1947

Carolann Steinhoff, B.Sc., CFP, CIM, FCSI

Senior Vice-President &

Senior Investment Advisor

Queensbury Securities Inc.,

St. Andrew’s Square

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7

 

Dear Friends,

Tangents:

The secret of health for both mind and body is not to mourn for the past, not to worry about the future, not to anticipate the future, but to live the present moment wisely and earnestly. – Buddha

June 21, 2012

-Will  Winter

For people like me who love the sun,

Who get gloomy when it is grey,

this is the very best day.

The track of yellow goes highest

over my house today.

Only a fool would sleep and miss a minute of this life…

And on this day…

1939 – Baseball legend Lou Gehrig is forced to quit baseball because of amyotrophic lateral sclerosis–a disease which wastes muscles.
1942 – German General Erwin Rommel captures the port city of Tobruk in North Africa.
1945 – Japanese forces on Okinawa surrender to American troops.
1948 – Dr. Peter Goldmark demonstrates his “long-playing” record.
1963 – France announces it will withdraw from the NATO fleet in the North Atlantic.
1964 – Three civil rights workers disappear in Meridian, Mississippi.
1982 – John Hinkley Jr. is found not guilty by reason of insanity for attempting to assassinate President Ronald Reagan.

If you torture the data long enough, it will confess to anything.

-Darrell Huff, How to Lie With Statistics, 1954.

photos of the day June 21, 2012

Racegoer Laura Nelson poses for photographs on Ladies Day, the third day of racing at the Royal Ascot, southwest of London.

Stefan Wermuth/Reuters

A bee collects pollen on a sunflower in a field in Biedermannsdorf, Austria, on the first day of summer.

Heinz-Peter Bader/Reuters 

Aymara indigenous musicians play flutes and drums at dawn during a new years’ ritual at the ruins of the ancient civilization of Tiwanaku, Bolivia. The Aymara Indians celebrate the year 5,520 as well as the southern hemisphere’s winter solstice, marking the start of a new agricultural cycle.

Juan Karita/AP

Market Closes for June 21, 2012:

North American Markets

Market  Index	Close	Change
Dow  Jones	12573.57	-250.82
		-1.96%
S&P 500	1325.51	-30.18
		-2.23%
NASDAQ	2859.09	-71.36
		-2.44%
TSX	11408.32	-351.02
		-2.99%

International Markets

Market  Index	Close	Change
NIKKEI	8824.07	+71.76
		+0.82%
HANG  SENG	19265.07	-253.78
		-1.30%
SENSEX	17032.56	+135.93
		+0.80%
FTSE 100	5566.36	-55.93
		-0.99%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	1.752	1.777
CND.   30 Year Bond	2.319	2.356
U.S.   10 Year Bond	1.6179	1.6503
U.S.   30 Year Bond	2.6861	2.7237

Currencies

BOC Close	Today	Previous
Canadian $	1.02882	1.01840
US   $	0.97198	0.98193
Euro Rate  1 Euro=		Inverse
Canadian   $	1.29093	0.77463
US  $	1.25477	0.79696

Commodities

Gold	Close	Previous
London Gold   Fix	1566.27	1607.70
Oil	Close	Previous
WTI Crude Future	77.84	81.80
BRENT	88.91	92.39

Market Commentary:

Canada

By Katia Dmitrieva

June 21 (Bloomberg) — Canadian stocks fell the most since October as reports showing a slowdown in global manufacturing pushed commodities down and dragged oil below $80 a barrel for the first time in eight months.

Energy and raw-materials stocks were the biggest drag on the Standard & Poor’s/TSX Composite Index among 10 industries, tumbling more than 4.1 percent each. Encana Corp. slid 7.9 percent after the company said it will increase spending, and Barrick Gold Corp. lost 3.8 percent. Niko Resources Ltd. tumbled 39 percent after the natural-gas producer’s reserves fell more than estimated.

The S&P/TSX tumbled 351.02 points, or 3 percent, to 11,408.32, erasing a weekly gain. Canadian equities were down the most among 24 developed nations tracked by Bloomberg and has lost 4.6 percent this year. Today’s slump followed reports showing manufacturing unexpectedly shrank in the Philadelphia area and that factory output was heading for an eighth straight monthly decline in China.

“China helps determine world prices,” Arthur Salzer of Toronto-based Northland Wealth Management, who manages $C200 million ($195 million), said in a phone interview. “They can push a trend into one direction.”

Global equities fell as a preliminary reading by HSBC Holdings Plc and Markit Economics showed China’s manufacturing slump may match the longest streak since the global financial crisis.

The Federal Reserve Bank of Philadelphia’s economic index showed the worst contraction in manufacturing in almost a year, while other reports showed existing U.S. home sales decreased more than forecast and jobless claims topped estimates.

Yesterday, the U.S. central bank lowered its outlook for the American economy. Euro-area manufacturing shrank at the fastest pace in three years.

All 10 groups in the S&P/TSX fell today, as the S&P GSCI gauge of 24 commodities slid to the lowest level since October 2010 and extended its drop since February to 22 percent. Energy stocks slumped 4.3 percent, while material companies dropped 4.2 percent.

The price of oil sank 4 percent to $78.20 a barrel in New York. Suncor Energy Inc., Canada’s largest energy provider, declined 6.6 percent to C$27.70. Canadian Natural Resources Ltd., the third-largest provider, fell 6 percent to C$26.60.

Encana retreated 7.9 percent to C$20.39. Canada’s biggest natural-gas producer said it will increase spending this year.

The Calgary-based company will invest an additional $600 million this year to boost production. The spending probably will be more than the company’s cash flow next year, Phil Skolnick, an analyst at Canaccord Genuity Inc. in Toronto, said in a note to investors today.

Niko Resources tumbled 39 percent to C$13.21, its biggest decline since 1993. The company said its total reserves on March 31 were 377 billion cubic feet. That’s about a 69 percent decline from a year earlier before adjusting for production, Alan Knowles, a Calgary-based analyst at Haywood Securities Inc., said in a note today.

Barrick Gold, the world’s largest producer of the metal, fell 3.8 percent to C$39.49. The price of the metal dropped for the fourth straight day.

US

By Rita Nazareth

June 21 (Bloomberg) — U.S. stocks tumbled, while commodities entered a bear market, after signals of a global slowdown in manufacturing added to disappointing housing and labor market data at the world’s largest economy.

Alcoa Inc. and Chevron Corp. slumped at least 3.4 percent to pace losses in commodity shares. Bed Bath & Beyond Inc. plunged 17 percent as its earnings forecast trailed estimates.

ConAgra Foods Inc. rose 2.7 percent as the maker of Hebrew National hot dogs forecast profit that beat estimates. Standard & Poor’s 500 Index futures expiring in September rose 0.2 percent at 5:43 p.m. New York time as bank credit downgrades announced by Moody’s Investors Service matched expectations.

The S&P 500 fell 2.2 percent to 1,325.51 at 4 p.m. in New York, its second-biggest loss in 2012. The Dow Jones Industrial Average slid 250.82 points, or 2 percent, to 12,573.57. Volume for exchange-listed stocks in the U.S. was about 7.2 billion shares, or 6.9 percent above the three-month average.

“It’s risk off,” said James McDonald, chief investment strategist at Northern Trust Corp. in Chicago, whose firm manages $717 billion. “The economy is losing momentum. The question will be how much the U.S. and China slow. On top of that, the Fed’s response yesterday was fairly tepid. While they indicated willingness to do more, they haven’t done it.”

Stocks from Hong Kong to London and Sao Paulo slumped on concern about a global slowdown. Data showed euro-area manufacturing shrank at the fastest pace in three years and a Chinese output gauge indicated contraction. More Americans than forecast filed claims for jobless benefits, manufacturing in the Philadelphia region shrank and sales of existing homes fell.

The reports came out a day after the Federal Reserve lowered its growth and employment estimates while signaling it may add to its record stimulus. The central bank yesterday extended its so-called Operation Twist program to replace short- term bonds with longer-term debt, disappointing some investors who expected more asset purchases. Former Fed Chairman Alan Greenspan today said the U.S. economy “looks very sluggish.”

The Citigroup Economic Surprise Index for the U.S., which measures how much data is missing or beating the median estimates in Bloomberg surveys, fell to minus 64.8, the lowest since August. It turned negative this year in April after remaining above zero since October. The Fed announced Operation Twist in September, four months after the index turned negative.

A challenging economic environment has made Goldman Sachs Group Inc. analyst Noah Weisberger recommend shorting the S&P 500, or bet on further declines. He has a target of 1,285, or 5.2 percent below yesterday’s close.

“With incremental U.S. monetary policy on hold, the market will need to confront a deteriorating growth picture near term,” Weisberger wrote.

Expectations for further policy action gave stocks their first back-to-back weekly gain since April on June 15. The S&P 500 earlier this month was on the brink of a so-called correction, or a 10 percent drop from a recent peak, on concern about a global slowdown and a worsening of Europe’s crisis.

All 10 S&P 500 groups fell today as commodity shares had the biggest losses. The Morgan Stanley Cyclical Index of companies most-tied to the economy lost 2.9 percent. The Chicago Board Options Exchange Volatility Index, which measures the cost of using options as insurance against declines in the S&P 500, rose 16 percent, the most since November, to 20.08.

Measures of commodity producers in the S&P 500 lost at least 3.2 percent for the biggest declines since November. The S&P GSCI Spot Index of 24 raw materials fell 2.8 percent to settle at 559. It has dropped 22 percent from this year’s highest close of 715.52 on Feb. 24, entering a bear market.

Alcoa, the largest U.S. aluminum producer, dropped 4.2 percent to $8.55. Chevron decreased 3.5 percent to $100.02.

The KBW Bank Index tumbled 2.3 percent as all of its 24 stocks retreated. Bank of America Corp. dropped 3.9 percent to $7.82. JPMorgan Chase & Co. slid 2.6 percent to $35.51.

In after-hours trading, Morgan Stanley jumped 3.4 percent after the world’s largest brokerage was downgraded two levels by Moody’s Investors Service rather than the three-grade cut that the ratings firm said was possible. The bank dropped 1.7 percent to $13.96 during regular trading.

Donald Jones, a Sterne Agee & Leach Inc. analyst, said in a June 19 note that the most likely outcome expected by bond investors was a three-grade rating cut.

Bed Bath & Beyond declined 17 percent, the most ever, to $61.17. It said comparable-store sales in the first quarter rose 3 percent compared with 7 percent a year earlier. Analysts projected a gain of 3.8 percent, the average of five estimates compiled by Bloomberg.

Red Hat Inc., the largest seller of the open-source Linux operating system, fell 6.2 percent to $53. Billings, a predictor of revenue, were $310 million in the quarter ended May 31, falling short of the $319 million average analyst estimate, said Abhey Lamba, an analyst at Mizuho Securities USA Inc.

Celgene Corp. fell 11 percent to $59.45. It withdrew its application in Europe to expand regulatory approval of Revlimid as a first option and maintenance therapy for patients with a deadly blood cancer.

Micron Technology Inc. retreated 7.8 percent to $5.65. The largest U.S. maker of computer memory reported a fourth consecutive quarterly loss after prices fell for chips used to store data in phones and tablets, crimping sales.

ConAgra jumped 2.7 percent to $25.26. The company forecast fiscal year 2013 earnings of at least $1.95 a share. On average, the analysts surveyed by Bloomberg estimated profit of $1.92.

Gannett Co. added 3.2 percent, the most in the S&P 500, to $13.47. The publisher of USA Today reaffirmed its long-term annual revenue growth targets. The owner of 82 daily newspapers and 23 television stations also said at an analysts’ conference that it sees improved ad trends across all of its groups.

Onyx Pharmaceuticals Inc. surged 43 percent to $63.78, the highest level on record, as it won support from a U.S. advisory panel for a drug to treat a deadly blood cancer that affects 50,000 Americans.

Facebook Inc.’s 22 percent rally in two weeks through yesterday has helped the company avoid posting the biggest slump among the largest U.S. initial public offerings since the start of 2011. The shares rose 0.8 percent to $31.84 today.

The social-network operator, which set a record for technology companies by raising $16 billion last month, has unveiled new products and services after the shares tumbled to a low of $25.87 on June 5.

PetroLogistics LP dropped 20.4 percent in its first month of trading, or 3.1 percentage points more than Facebook, giving the propylene maker the worst return among the 30 largest IPOs since the beginning of last year, data compiled by Bloomberg show.

Concern Facebook was overvalued and that the company will struggle to increase revenue fast enough pushed the stock down as much as 32 percent from its IPO price of $38 on May 17.

Since the shares bottomed earlier this month, Facebook introduced a real-time bidding platform to better target ads to consumers and ComScore Inc. released research that showed marketing on the social network is effective.

“Investors are starting to come around to see the significant opportunity of the Facebook platform,” Victor Anthony, a New York-based analyst at Topeka Capital Markets Inc., said in a telephone interview. He has a buy rating on the stock. “It was a botched IPO process but ultimately, the underwriters did their job. If the stock increasingly marches up, all the concerns will be tapered down.”

Have  a wonderful evening everyone.

Be magnificent!

 

The human soul travels from the law to love,

from discipline to freedom,

from the moral plane to the spiritual plane.

-Rabindranath Tagore, 1861-1901

As ever,

Carolann

 

We are the hero of our own story.

-Mary McCarthy, 1912-1989

Carolann Steinhoff, B.Sc., CFP, CIM, FCSI

Senior Vice-President &

Senior Investment Advisor

Queensbury Securities Inc.,

St. Andrew’s Square

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7

 

Dear Friends,

Tangents: Summer begins today!

Write it on your heart that every day is the best day in the year.

– Ralph Waldo Emerson

We arrived home last night – had a great week in Amsterdam – what a fantastic city…architecture,  parks, museums, art, art, and more art!   J I have to say, there was no sign of a Euro crises; it seemed fairly prosperous everywhere we went.

And on this day in…

1837 – 18-year-old Victoria is crowned Queen of England.
1863 – President Abraham Lincoln admits West Virginia into the Union as the 35th state.

1948 – The Ed Sullivan Show premieres

1963 – The United States and the Soviet Union agree to establish a hot line between Washington and Moscow.
1967 – Boxing champion Muhammad Ali is convicted of refusing induction into the American armed services.
1999 – NATO declares an official end to its bombing campaign of Yugoslavia

photos of the day June 20, 2012

Ten-month-old Leo Erichsen is held up by his mother, Tatjana Eres of Denmark, as she joins thousands of yoga enthusiasts for a class in New York’s Times Square to mark the summer solstice.

Mark Lennihan/AP

Myanmar pro-democracy leader Aung San Suu Kyi leaves through The Great Gate after receiving her honorary degree at Oxford University, in Oxford, southern England.

Ki Price/Reuters

Market Closes for June 20, 2012:

North American Markets

Market  Index	Close	Change
Dow  Jones	12824.39	-12.94
		0.10%
S&P 500	1355.69	-2.29
		-0.17%
NASDAQ	2930.45	+0.69
		+0.02%
TSX	11759.34	-29.02
		-0.25%

International Markets

Market  Index	Close	Change
NIKKEI	8752.31	+96.44
		+1.11%
HANG  SENG	19518.85	+102.18
		+0.53%
SENSEX	16896.63	+36.83
		+0.22%
FTSE 100	5622.29	+35.98
		+0.64%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	1.777	1.762
CND.   30 Year Bond	2.356	2.364
U.S.   10 Year Bond	1.6503	1.6180
U.S.   30 Year Bond	2.7237	2.7326

Currencies

BOC Close	Today	Previous
Canadian $	1.01840	1.01794
US   $	0.98193	0.98238
Euro Rate  1 Euro=		Inverse
Canadian   $	1.29392	0.77285
US  $	1.27054	0.78707

Commodities

Gold	Close	Previous
London Gold   Fix	1607.70	1618.85
Oil	Close	Previous
WTI Crude Future	81.80	84.03
BRENT	92.39	95.95

Market Commentary:

Canada

By Inyoung Hwang and Katia Dmitrieva

June 20 (Bloomberg) — Canadian stocks fell, ending a three-day rally, after the U.S. Federal Reserve cut its estimates for economic growth amid a slowdown in hiring.

Technology and commodity shares led declines in the Standard & Poor’s/TSX Composite Index. Research in Motion, the struggling Waterloo-based maker of the BlackBerry mobile device, dropped 1.4 percent as the company said it’s cutting jobs as part of an effort to save $1 billion in operating expenses.

Canadian Natural Resources Ltd. and Suncor Energy Inc. slumped at least 1.6 percent as oil declined.

The S&P/TSX lost 29.02 points, or 0.3 percent, to 11,759.34 in Toronto. The benchmark index posted its second-biggest gain of the year yesterday.

“There’s this feeling that the U.S. economy is slowing down and the Fed would have to do something,” said Paul Harris, who oversees C$279 million at Avenue Investment Management in a telephone interview. “Europe is definitely an issue, he said.

In order ‘‘to have more global growth, you really need a stabilization of the European economy and fiscal issues.’’

Antonis Samaras, head of Greece’s New Democracy party, was sworn in as prime minister after Greek political leaders agreed on a coalition that will seek relief from austerity measures tied to international loans. French President Francois Hollande said European leaders are exploring ways for the rescue fund to buy debt from countries that have taken fiscal consolidation measures.

Canadian equities fell as the U.S. central bank cut its estimates for growth and said it’s seeing little progress on unemployment during the rest of the year. The Fed said it would expand its program dubbed Operation Twist to replace short-term bonds with longer-term debt by $267 billion through the end of the year in a bid to reduce unemployment and protect the expansion.

Expectations for further policy action gave Canadian stocks their first back-to-back weekly gain since April on June 15. The S&P/TSX fell as much as 11 percent last month from its Feb. 28 high this year, on concern about a global slowdown and a worsening of Europe’s crisis.

Energy companies declined 0.9 percent as crude oil fell to an eight-month low after the U.S. Energy Department reported an unexpected increase in stockpiles to the highest level in 22 years. Canadian Natural Resources fell 1.9 percent to C$28.30.

Suncor, the nation’s largest energy provider, fell 1.7 percent to C$29.65.

Research in Motion tumbled 4.3 percent to C$10.49. “RIM has committed to achieving significant efficiencies and operating cost reductions over the course of this fiscal year,” Tenille Kennedy, a spokeswoman for the Waterloo, Ontario-based company, said yesterday in an e-mail. “Headcount reductions are part of this initiative.”

US

By Rita Nazareth

June 20 (Bloomberg) — U.S. stocks dropped, following a four-day gain in the Standard & Poor’s 500 Index, as the Federal Reserve cut its estimates for growth amid a slowdown in hiring.

Adobe Systems Inc., the largest maker of graphic-design software, declined 2.7 percent after forecasting sales and profit that trailed estimates. Procter & Gamble Co. tumbled 2.9 percent as the world’s biggest consumer-goods company reduced its earnings and revenue forecasts for the second time in less than two months. JPMorgan Chase & Co. rallied 3 percent.

The S&P 500 retreated 0.2 percent to 1,355.69 at 4 p.m. New York time. The Dow Jones Industrial Average decreased 12.94 points, or 0.1 percent, to 12,824.39. Trading volume for exchange-listed stocks in the U.S. was about 6.6 billion shares, or almost in line with the three-month average.

“It’s not all bad news, but caution is warranted,” said Eric Teal, chief investment officer at First Citizens Bancshares Inc., which manages $4.5 billion in Raleigh, North Carolina. He spoke in a telephone interview. “If the Fed saw significant deterioration, the policy response would have been on a larger scale. Yet there’s increased risk to the economic outlook.”

Stocks fell as the central bank cut its estimates for growth and said it sees little progress on unemployment during the rest of the year. The Fed lowered its central tendency estimate for U.S. 2012 gross domestic product growth to 1.9 percent to 2.4 percent from 2.4 percent to 2.9 percent in April.

The Fed will expand its program to replace short-term bonds with longer-term debt by $267 billion through the end of 2012.

That “should put downward pressure on longer-term interest rates and help to make broader financial conditions more accommodative,” the Federal Open Market Committee said.

“If we don’t see continued improvement in the labor market, we’ll be prepared to take additional steps if appropriate,” Fed Chairman Ben S. Bernanke said at a news conference after the FOMC’s two-day meeting. He said those steps might include additional asset purchases.

Expectations for further policy action gave stocks their first back-to-back weekly gain since April on June 15. The S&P 500 earlier this month was on the brink of a so-called correction, or a 10 percent drop from a recent peak, on concern about a global slowdown and a worsening of Europe’s crisis.

Investors also watched Europe’s latest attempts to tame its debt crisis today. Antonis Samaras, head of Greece’s New Democracy party, was sworn in as prime minister after Greek political leaders agreed on a coalition that will seek relief from austerity measures tied to international loans.

European policy makers are unlikely to solve the region’s problem unless they have a crisis “moment” like Lehman Brothers Holdings Inc.’s bankruptcy, said Gary D. Cohn, Goldman Sachs Group Inc.’s president and chief operating officer.

“My personal view is we’re going to need a moment” because the issues are political, Cohn, said in an interview with Erik Schatzker on Bloomberg Television’s “Market Makers.”

Eight out of 10 groups in the S&P 500 fell today as utility and consumer staples companies had the biggest losses.

Technology and financial shares advanced.

Adobe slumped 2.7 percent to $31.99. It reduced the high end of its annual sales growth forecast range to 7 percent from 8 percent, which is “anemic” for a technology company, said Barbara Coffey, an analyst with National Securities.

P&G lost 2.9 percent to $60.39. The reduced forecasts illustrate the difficulties faced by consumer-products makers as rising unemployment in Europe and North America restricts spending. Danone, the world’s biggest yogurt maker, cut its profitability forecast yesterday. Europe is “difficult for everybody,” Jean-Marc Huet, chief financial officer of Unilever, said at the Paris conference yesterday.

Walgreen Co. retreated 2.9 percent to $29.21. The biggest U.S. drugstore chain was downgraded to neutral from outperform at Macquarie Group Ltd. by equity analyst Dane Leone. The 12- month share-price estimate is $34.

JPMorgan gained 3 percent to $36.45. Trading in the credit derivatives index that contributed to the bank’s losses in its London chief investment office soared to a record yesterday in a sign that the biggest U.S. bank may be unwinding its position, according to data cited by Credit Suisse Group AG.

The lender is seeking to stem at least $2 billion in trading losses from the U.K. operation, where Bruno Iksil, known as the London Whale, managed a portfolio of credit derivatives so large it distorted the market.

A strategy by the unit to reduce risks from hedges backfired and left the bank with even bigger and harder-to- manage exposures, Chief Executive Officer Jamie Dimon said last week. JPMorgan has sold 65 to 70 percent of its losing position and is still selling the rest, CNBC reported.

The Bloomberg U.S. Airlines Index advanced 2.3 percent as oil dropped to an eight-month low after the Energy Department reported that U.S. crude inventories climbed to the highest level in 22 years.

Cisco Systems Inc. rallied 1.9 percent to $17.51. The biggest maker of computer-networking equipment was raised to outperform from market perform at BMO Capital Markets.

Applied Materials Inc. gained 3.4 percent to $11.55. The largest producer of chipmaking equipment was raised to overweight at Barclays Plc.

Tesla Motors Inc. jumped 5.3 percent to $33.78 as the electric-car maker prepares to begin deliveries of Model S sedans and Goldman Sachs raised its price target for the shares.

Have a wonderful evening everyone.

Be magnificent!

 

Nature’s law dictates that, in order to survive, bees must work together.

As a result, they instinctively possess a sense of social responsibility.

They have no constitution, no law, no police, no religion or moral training but,

because of their nature, the whole colony survives.

We human beings have a constitution, laws and a police force.

We have religion, remarkable intelligence, and hearts with a great capacity to love.

We have many extraordinary qualities but, in actual practice,

I think we are behind those small insects.

In some ways, I feel that we are poorer than the bees.

-The XIVth Dalai Lama

As ever,

Carolann

I swore never to be silent whenever and wherever human beings endure suffering and humiliation. We must always take sides. Neutrality helps the oppressor, never the victim. Silence encourages the tormentor, never the tormented.

-Elie Wiesel, 1928-

Carolann Steinhoff, B.Sc., CFP, CIM, FCSI

Senior Vice-President &

Senior Investment Advisor

Queensbury Securities Inc.,

St. Andrew’s Square

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7

 

Dear Friends,

Tangents:

Emily Carr is one of the best know Canadian painters and an icon of the Canadian art world. Eight of her canvases were among the top 100 painting ever sold at auction in Canada with her 1939 work Wind in the Treetops ranking number 9 after raking in a winning bid of $2.2 million.

While a household name in Canada, Carr has never quite been able to nab the same distinction at the international level. However this may soon change. An exhibition of seven of her most illustrious paintings, from the Vancouver Art Gallery’s permanent collection, are on display at dOCUMENTA, the prestigious and influential international art showcase held every five years in Kassel, Germany. Carr is the first Canadian to be honoured with this posthumous invitation.

Big Raven

Emily Carr, 1931, oil on canvas. Carr’s painting was deeply influenced by the art of the Northwest Coast First Nations

Today in History

June 19

240BC		Eratosthenes estimates the circumference of Earth using two sticks.
1536		Anne Boleyn, Henry VIII’s second wife, is beheaded.
1848		The first Women’s Rights Convention convenes in Seneca Falls, New York.
1862		President Abraham Lincoln outlines his Emancipation Proclamation. News of the document reaches the South.
1885		The Statue of Liberty arrives in New York City from France.
1963		Soviet cosmonaut, Valentia Tereshkova, becomes the first woman in space.

photos of the day June 19, 2012

People hold a 550-foot-long sacred cloth to offer at the tomb of Emperor Shah Jahan on the 357th anniversary of his death at the historic Taj Mahal, in the northern Indian city of Agra. The Taj Mahal was built by the Emperor in memory of his wife and is one of the world’s most famous monuments.

-Brijesh Singh/Reuters

In this image made off the monitor screen at the Beijing Aerospace Flight Control Center, Chinese astronaut Liu Wang (l.) tries to help his female colleague, Liu Yang, move forward as their commander Jing Haipeng waves in the orbiting Tiangong-1 lab module.

-Beijing Aerospace Control Center via Xinhua/AP

Market Closes for June 19, 2012:

North American Markets

Market  Index	Close	Change
Dow  Jones	12837.33	+95.51
		+0.75%
S&P 500	1357.98	+13.20
		+0.98%
NASDAQ	2929.76	+34.43
		+1.19%
TSX	11788.36	+187.23
		+1.61%

International Markets

Market  Index	Close	Change
NIKKEI	8655.87	-65.15
		-0.75%
HANG  SENG	19416.67	+11.14
		-0.06%
SENSEX	16859.80	+153.97
		+0.92%
FTSE 100	5586.31	+95.22
		+1.73%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	1.762	1.714
CND.   30 Year Bond	2.364	2.344
U.S.   10 Year Bond	1.6180	1.581
U.S.   30 Year Bond	2.7326	2.671

Currencies

BOC Close	Today	Previous
Canadian $	1.01794	1.0235
US   $	0.98238	0.9769
Euro Rate  1 Euro=		Inverse
Canadian   $	1.29144	0.77433
US  $	1.26868	0.78822

Commodities

Gold	Close	Previous
London Gold   Fix	1618.85	1628.90
Oil	Close	Previous
WTI Crude Future	84.03	82.95
BRENT	95.95	97.76

Market Commentary:

Canada

By Steve Chambers and Katia Dmitrieva

June 19 (Bloomberg) — Canadian stocks rose, sending the Standard & Poor’s/TSX Composite Index up for a third day, as optimism that Europe’s debt crisis is easing and speculation that the Federal Reserve will act to stimulate the economy fueled gains in oil prices and equities worldwide.

Energy and bank stocks contributed the most to the advance in the Standard & Poor’s/TSX Composite Index. Canadian Natural Resources Ltd., the nation’s third-largest energy provider, rose 1.7 percent, while Royal Bank of Canada, the country’s largest lender, added 3.5 percent, its biggest gain since December on a closing basis.

The S&P/TSX Composite Index gained 159.40 points, or 1.4 percent, to 11,760.53 at 2:39 p.m. Toronto time. The index added to its first back-to-back weekly gains in two months, and pared its 2012 loss to 1.6 percent.

“There’s an absence of bad news; there’s nothing to push the market down,” Thomas Caldwell, founder of Caldwell Securities Ltd. in Toronto, said in a phone interview. The firm manages C$1 billion ($982 million). “No bad news on any front leaves room for the market to go considerably higher.”

Global stocks rallied for a fourth day as the U.S. Fed began a two-day meeting amid rising expectations that it will do something to spur growth following government data on joblessness indicating a slowdown.

Statistics Canada said wholesale sales rose 1.5 percent in April to C$49.3 billion, the fastest since May 2011 and more than the 0.2 percent median estimate in a Bloomberg survey of economists.

The S&P/GSCI Spot Index increased 0.8 percent after falling 0.2 percent the day before. Ivanhoe Mines added 3.9 percent to C$10.68. Potash Corp. of Saskatchewan, the world’s second- largest agricultural chemicals supplier, rose 4.2 percent to C$41.57. Fertilizer producer Agrium Inc. climbed 2.6 percent to C$88.22.

Energy stocks gained 1.9 percent after oil rallied 0.9 percent, reversing yesterday’s 0.9 percent decline. Suncor Energy Inc., Canada’s largest energy provider, jumped 3 percent to C$30.14. Cenovus Energy Inc., a provider of oil and natural gas, increased 3.6 percent to C$33.42. Canadian Natural Resources added 1.7 percent to C$28.80.

Royal Bank of Canada rose 3.5 percent to C$52.66, after falling 0.7 percent yesterday. Toronto-Dominion Bank, the nation’s second-largest lender, advanced 1.5 percent to C$79.78, after dropping 0.5 percent the previous day.

US

By Rita Nazareth

June 19 (Bloomberg) — U.S. stocks advanced, sending the Standard & Poor’s 500 Index to the highest level in more than a month, as investors speculated the Federal Reserve will announce more measures to stimulate the world’s largest economy.

Bank of America Corp. climbed 4.5 percent as the Federal Housing Finance Agency said it plans to help banks avoid being forced to buy back mortgages amid concern lenders are tightening standards even for the most creditworthy buyers. FedEx Corp., operator of the largest cargo airline, jumped 2.8 percent after pledging “significant cost reductions.” Microsoft Corp. increased 2.9 percent after unveiling a tablet computer.

The S&P 500 rose 1 percent to 1,357.98 at 4 p.m. New York time, gaining for a fourth day. The Dow Jones Industrial Average added 95.51 points, or 0.8 percent, to 12,837.33. Trading volume for exchange-listed stocks in the U.S. was about 6.8 billion shares, or almost in line with the three-month average.

“It’s possible that the Federal Reserve will do something else,” said David Kelly, who helps oversee about $394 billion as chief market strategist at JPMorgan Funds in New York. “It’s possible that they will do some further extension of Operation Twist. They seem overly sensitive to the possibility that the market will react badly to them not taking action.”

Signs of slowing growth amid Europe’s turmoil could mean the Fed, which began a two-day meeting today, could extend its so-called Operation Twist, according to JPMorgan Chase & Co. and Jefferies & Co. The program involves selling short-term debt and buying longer-term bonds. A more aggressive response could be warranted if the Fed see high costs in a slowdown of growth.

The central bank may expand its balance sheet, extend Operation Twist and/or lengthen its short-term interest rate guidance beyond late 2014, Goldman Sachs Group Inc. chief economist Jan Hatzius wrote today.

“A decision not to ease is tantamount to a tightening,” he wrote in an e-mailed report to clients today. “At this point we’d be quite surprised if we saw no easing.”

Expectations for further policy action gave stocks their first back-to-back weekly gain since April on June 15. The S&P 500 earlier this month was on the brink of a so-called correction, or a 10 percent drop from a recent peak, on concern about a global slowdown and a worsening of Europe’s crisis.

Equities briefly pared gains as a German official said the Group of 20 leaders didn’t discuss any specific plans for Europe’s rescue funds to buy the bonds of euro-area governments.

Haggling among Greek political leaders is set to continue for a third day over a coalition that will seek relief from austerity measures tied to emergency loans, with Pasok leader Evangelos Venizelos saying a new government could be ready by midday tomorrow. Spanish bond yields fell after yesterday’s surge.

The S&P 500 traded near its average price of the last 100 days of about 1,359. A rally above that level could be considered a harbinger of more gains, according to analysts who study charts to make forecasts. The Chicago Board Options Exchange Volatility Index, which measures the cost of using options as insurance against S&P 500 losses, rose 0.3 percent to 18.38, after slumping 25 percent in three days.

Seven out of 10 groups in the S&P 500 rose today as commodity, financial and industrial shares had the biggest gains. The Morgan Stanley Cyclical Index of companies most-tied to the economy increased 2 percent. The KBW Bank Index rallied 2 percent as all of its 24 stocks advanced.

Bank of America surged 4.5 percent to $8.11. The FHFA will detail flaws that would trigger a putback request, Stefanie Johnson, a spokeswoman for the FHFA, said in a statement.

Julius Baer Group Ltd. is in talks with Bank of America about acquiring its Merrill Lynch wealth management business outside the U.S. The Bank of America wealth unit may fetch about $2 billion, said a person familiar with the matter.

JPMorgan added 2.2 percent to $35.38. Chief Executive Officer Jamie Dimon told U.S. House members that he complied with disclosure rules in warning investors about changes that contributed to the bank’s trading loss of at least $2 billion.

It was his second appearance on Capitol Hill in less than a week to explain how the firm lost control of its derivatives trades.

FedEx, which is considered an economic bellwether, gained 2.8 percent to $91.01. The company’s express unit, which accounts for the bulk of sales, is developing a detailed strategy to improve efficiency in its operating expenses, Chief Financial Officer Alan Graf said on an earnings call.

Microsoft added 2.9 percent to $30.70. The Windows-powered tablet computer called Surface alters the company’s strategy of focusing on software and relying on partners to make the machines, in a renewed attempt to take on Apple Inc.’s iPad.

Nvidia Corp. rallied 6.7 percent to $13.24. Microsoft said the tablet computer will be powered by its Tegra processor.

Oracle Corp. advanced 3.1 percent to $27.96. The world’s largest maker of database software reported that fiscal fourth- quarter profit topped analysts’ estimates, buoyed by sales of new software licenses.

Goodyear Tire & Rubber Co. and Cooper Tire & Rubber Co. rose as a global rubber deficit is projected to turn into a surplus in the second half, driving down the price tiremakers pay for the raw material. Goodyear increased 5.6 percent to $11.53. Cooper Tire added 3.2 percent to $17.23.

MetLife Inc. jumped 5 percent to $30.88. The largest U.S. life insurer got more time to submit a fresh capital plan to the Fed as the firm seeks to raise its dividend and resume buybacks after being twice blocked by the regulator.

J.C. Penney Co. tumbled 8.6 percent to $22.25, the lowest since 2010. The company’s merchandising and marketing chief is leaving, and Chief Executive Officer Ron Johnson will take over his duties, following a marketing strategy that has flopped with shoppers. The departure comes as Johnson struggles to remake the retailer’s image and overhaul its pricing strategy.

“They weren’t happy with the marketing direction, and it wasn’t resonating with consumers,” said Lizabeth Dunn, an analyst with Macquarie Group in New York. “They really want to emphasize price and product more obviously in marketing.”

Walgreen Co. dropped 5.9 percent to $30.09. The largest U.S. drugstore chain agreed to pay $6.7 billion for a 45 percent stake in the U.K.’s Alliance Boots, with an option to gain full control in about three years.

Barnes & Noble Inc. slumped 4 percent to $14.63. The largest U.S. bookstore chain posted fourth-quarter revenue that trailed analysts’ estimates.

The peak in stock trading during the market’s decline after April was less than half the volume triggered during the slumps in 2011 and 2010, a sign bears could come back in force, according to Bank of America.

About 4.67 billion shares changed hands on the New York Stock Exchange on June 1, the busiest trading since the S&P 500 started its retreat from this year’s high in April, according to data compiled by Bank of America and Bloomberg. That compared with peak volume of more than 9.5 billion in the previous two years, the data show.

The S&P 500 tumbled 9.9 percent from April 2 through June 1 and has since risen 6.3 percent. The relatively slow trading during the retreat suggests a lack of “volume shakeout” and means bears may still have the power to drive the market lower, according to Mary Ann Bartels, a New York-based technical analyst at Bank of America.

“While the short-term technicals support the case for a rally, the risk is that sellers are not yet completely exhausted and an adverse macro news event could trigger a future shakeout,” Bartels wrote in a note dated yesterday.

Have a wonderful evening everyone!

”They key is to keep company with people who uplift you, whose presence calls forth your best.” – Epictetus

Ellora Howie

Assistant to Carolann Steinhoff

 

Queensbury Securities Inc.,

St. Andrew’s Square

Suite 340A, 730 View St.,

Victoria, B.C. V8X 3Y7

 

Dear Friends,

Tangents:

Today marks a day in China that many will remember after The Shenzhou 9 capsule completed the manoeuvre with the Tiangong 1 module.  On Saturday China launched its most ambitious space mission to date. The goal: to dock the shuttle with an orbiting module and work on board for more than a week.  With 3 members on board, this orbit marks the first for 33 year old Liu Yang; the first female astronaut China has sent to space.  Two of the astronauts will live and work inside the module to test its life-support systems while the third will remain in the capsule to deal with any unexpected emergencies. China is hoping to join the United States and Russia as the only countries to send independently maintained space stations into orbit. It is already one of just three nations to have launched manned spacecraft on their own. At a sending off ceremony for the astronauts, the ruling Communist Party’s No. 2 official, Wu Bangguo, told the crew, “The country and people await your victorious return.”

The Shenzhou 9 spacecraft rocket lifts off from the launch pad at the Jiuquan Satellite Launch Center in Jiuquan, China, Saturday, June 16, 2012

Today in History

June 18

1923		The First Checker Cab is produced by the Checker Cab Manufacturing Company, in Kalamazoo, Michigan
1928		Amelia Earhart completes the flight from Newfoundland to Wales , becoming the first woman to fly across the Atlantic Ocean as a passenger
1941		British troops bombard the German-occupied French coast with explosives during the night before and early into the morning.
1952		Japan announced that they recognized the Chinese Nationalist government as opposed to the Communist Peiping regime.
1983		The space shuttle Challenger is launched into space on its second mission. Aboard the shuttle was Dr. Sally Ride, who as a mission specialist became the first American woman to travel into space.

photos of the day June 18, 2012

A young re-enactor drinks from a horn during an open day at the medieval Fort Saint Angelo in Vittoriosa in Valletta’s Grand Harbour, Malta. The fort served as the headquarters of the Knights of St John during the 1565 Great Siege.

A Hindu priest carries a basket of mangoes to distribute among devotees after it was offered to Hindu God Lord Krishna inside a temple during a mango festival in the western Indian city of Ahmedabad, Sunday.

Market Closes for June 18, 2012:

North American Markets

Market  Index	Close	Change
Dow  Jones	12741.82	-25.35
		-0.20%
S&P 500	1344.78	+1.94
		+0.14%
NASDAQ	2895.33	+22.53
		+0.78%
TSX	11601.13	+76.23
		+0.66%

International Markets

Market  Index	Close	Change
NIKKEI	8721.02	+151.70
		+1.77%
HANG  SENG	19427.81	+193.87
		+1.01%
SENSEX	16705.83	-244.00
		-1.44%
FTSE 100	5491.09	+12.28
		+0.22%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	1.714	1.731
CND.   30 Year Bond	2.344	2.344
U.S.   10 Year Bond	1.581	1.5840
U.S.   30 Year Bond	2.671	2.6942

Currencies

BOC Close	Today	Previous
Canadian $	1.0235	1.02218
US   $	0.9769	0.97830
Euro Rate  1 Euro=		Inverse
Canadian   $	1.2874	0.9769
US  $	1.25777	0.79506

Commodities

Gold	Close	Previous
London Gold   Fix	1628.90	1624.90
Oil	Close	Previous
WTI Crude Future	82.95	84.03
BRENT	97.76	97.93

Market Commentary:

Canada

By David Friend

June 18 (The Canada Press) — The Toronto stock market overcame pessimism out of Europe and weaker commodity prices on Monday to end the session higher as markets around the globe weighed the outcome of the Greek elections against concerns about Spain’s debt troubles.

The S&P/TSX composite index moved up 76.23 points to 11,601.13, while the TSX Venture Exchange gained 8.73 points to 1,259.75.

The Canadian dollar dropped 0.18 of a cent to 97.65 cents US.

Much of the attention was focused on the outcome of the Greek election won by a party backing harsh austerity measures. That was considered a positive development, though concern then shifted toward Spain’s debt problems.

Commodity prices fluctuated as both developments influenced markets.

The July crude contract on the New York Mercantile Exchange was down 76 cents at US$83.27 a barrel.

Gold bullion dropped $1.10 to US$1,627 an ounce while July copper edged up one cent to US$3.39 a pound.

On the TSX, materials stocks rose 2.1 per cent with Barrick Gold (TSX:ABX) rising 90 cents to C$41.18.

Financials were on the downside, off 0.4 per cent, with TD Bank (TSX:TD) dropping 41 cents to $78.57.

The outlook for the global economy appeared to be weighing slightly heavier on U.S. markets.
On Wall Street, the Dow Jones industrial average was off 25.35 points at 12,741.82. The Nasdaq composite index rose 22.53 points to 2,895.33 and the S&P 500 index inched up 1.94 points to 1,344.78.

The Greek election results suggested the country would not drop out of the euro currency union, a scenario that would have put severe stress on the financial system.

But much of the relief faded when it became clear that Spain’s fundamental economic and fiscal problems remain huge. Spanish borrowing rates spiked Monday above levels that forced other countries to take bailouts, a sign that bond investors fear Spain will default on its debts.

European stocks ended slightly higher in the afternoon. Britain’s FTSE 100 rose 0.22 per cent while Germany’s DAX added 0.3 per cent and France’s CAC-40 fell 0.69 per cent.

“The mind set seems to be forming that the Band-Aid approach is too little too late, and there’s not much of a concerted set of initiatives to really tackle the problem appropriately,” said Garey Aitken, director of equity research, Bissett Investment Management.

“Until people see there’s really significant change coming, I think we’re just in this washing machine of a market.”

In Canada, Yamana Gold Inc. (TSX:YRI) announced the acquisition Monday of Extorre Gold Mines Ltd. (TSX:XG), a miner with a promising gold-silver project in Argentina for about $400 million. Yamana will pay $3.50 in cash and 0.467 of a Yamana share for each Extorre share, while also saying it plans to increase its dividend by 18 per cent. Yamana shares rose 39 cents to $16.75.

Celestica Inc. (TSX:CLS) said it will wind down manufacturing services for Research In Motion (TSX:RIM) over the next three to six months. Celestica says it has been working with RIM as the troubled BlackBerry maker assesses its supply chain strategy. Celestica shares rose 28 cents to $7.89, while RIM stock fell 30 cents to $10.87.

Chartwell Seniors Housing Real Estate Investment Trust (TSX:CSH.UN) is selling six properties in the United States for about US$165.5 million, including outstanding mortgages. Its units rose 40 cents to $9.20.

A report in the Globe and Mail says Manitoba Telecom Services Inc. (TSX:MBT) is trying to find a buyer for its Allstream division and has hired investment bank Morgan Stanley to find foreign suitors, particularly in the United States, after failing to find a Canadian buyer. Company shares were up 2.1 per cent, or 67 cents, to $33.41.

Microsoft is expected to make a “major” announcement on Monday, with speculation leaning toward either a tablet computer or a system that uses an upcoming version of Windows to help people access TV shows and movies across a range of devices.

US

By Rita Nazareth

June 18 (Bloomberg) —  Most U.S. stocks advanced, sending the Standard & Poor’s 500 Index higher for a third day, as optimism about Greece’s attempts to form a coalition government tempered concern about a surge in Spanish bond yields.

Apple Inc. (AAPL), the world’s most valuable company, added 2 percent to pace gains in technology shares. D.R. Horton Inc. and Lennar Corp. (LEN) climbed at least 3.9 percent as confidence among homebuilders rose to a five-year high. Facebook Inc. (FB) rallied 4.7 percent in the one-month anniversary of its initial public offering. Energy and financial shares in the S&P 500 declined.

Ten stocks gained for every nine falling on U.S. exchanges at 4 p.m. New York time. The S&P 500 rose 0.1 percent to 1,344.78, after dropping 0.6 percent. The Dow Jones Industrial Average lost 25.35 points, or 0.2 percent, to 12,741.82. The Nasdaq Composite Index added 0.8 percent to 2,895.33. Trading volume for exchange-listed stocks in the U.S. was about 5.8 billion shares, 13 percent below the three-month average.

“We managed not to drive off the cliff in Greece, but we still got flat tires,” said Alan Gayle, a senior strategist at RidgeWorth Capital Management in Richmond, Virginia, which oversees about $47 billion. “The challenges in Spain are very much in front of us. There’s not a lot of conviction.”

Equities rebounded as Antonis Samaras, leader of Greece’s New Democracy party, said he had a constructive discussion with Democratic Left leader Fotis Kouvelis. German Chancellor Angela Merkel’s said Greece shouldn’t be granted leeway on terms for its bailout. Group of 20 chiefs began a two-day meeting as Spain’s borrowing costs soared to a euro-era record. Policy makers are discussing ways to stimulate the economy if necessary, a Canadian official said.

Federal Reserve policy makers meet June 19-20 to discuss whether more U.S. stimulus is need. The National Association of Home Builders/Wells Fargo confidence index rose to 29, the highest since May 2007, from a revised 28 in May that was lower than first estimated, a report from the Washington-based group showed today. The gauge exceeded the median estimate of 28 in a Bloomberg News survey.

“It’s somewhat tenuous at this juncture,” said Mark Luschini, chief investment strategist for Philadelphia-based Janney Montgomery Scott LLC, which manages about $54 billion. “With the G-20 meeting going on and the Fed policy meeting this week, investors are somewhat hesitant.”

Concern about a global slowdown and a worsening of Europe’s debt crisis put the S&P 500 on the brink of a so-called correction this month. It fell 9.9 percent from an almost four- year high in April through June 1. Since then, the lowest valuation in six months and bets on global policy action drove the measure up 5.2 percent.

Eight out of 10 groups in the S&P 500 rose as consumer discretionary and technology shares had the biggest gains. Apple jumped 2 percent to $585.78. A measure of homebuilders in S&P indexes gained 3.5 percent. D.R. Horton increased 3.9 percent to $16.50. Lennar climbed 4.1 percent to $26.97.

The Chicago Board Options Exchange Volatility Index, which measures the cost of using options as insurance against S&P 500 losses, tumbled 13 percent to 18.32, the lowest since May 3.

Facebook, which last week had the first weekly advance since its initial public offering, rose 4.7 percent to $31.41. The shares have jumped 15 percent in three days.

Groupon Inc. (GRPN) rallied 11 percent to $11.15. The largest daily coupon website advanced after Morgan Stanley (MS) analysts upgraded the stock to overweight from equalweight, citing international sales opportunities.

EBay Inc. (EBAY) rallied 4.5 percent to $42.49. The world’s largest Internet marketplace was rated outperform in new coverage at Keefe, Bruyette & Woods Inc.

Solar manufacturers led by LDK Solar Co. and First Solar (FSLR) Inc. rallied as Japan approved subsidies that will encourage at least $9.6 billion in new installations in the country. U.S. shares of Xinyu, China-based LDK climbed 1.8 percent to $2.21. Tempe, Arizona-based First Solar, the world’s largest maker of thin-film panels, gained 3.7 percent to $14.47.

A measure of energy (S5ENRS) shares in the S&P 500 fell 0.8 percent, the most among 10 groups, as oil slumped amid a stronger U.S. dollar.Halliburton Co. (HAL), the world’s largest provider of hydraulic-fracturing services, declined 1.7 percent to $28.96. Morgan Stanley, owner of the world’s largest brokerage, slumped 3.4 percent to $13.82 to pace losses in financial companies.

SAIC Inc. (SAI) declined 3.1 percent to $11.86 after losing its largest government contract to Lockheed Martin Corp. (LMT) Bethesda, Maryland-based Lockheed on June 15 beat SAIC for a $1.91 billion, seven-year Defense Department contract to operate a communications network known as the Global Information Grid.

Body Central Corp. (BODY) plunged 49 percent to $8.22, the lowest ever. The operator of almost 250 women’s clothing stores cut its second-quarter profit forecast amid declining sales at established stores.

DSW Inc. (DSW) slumped 11 percent to $52.13 after the shoe retailer’s second-quarter profit forecast trailed estimates.

The largest U.S. companies are beating the average stock in the S&P 500 by the most in more than a decade, fueled by rising dividends, valuations 31 percent below the historical average and fear.

Companies in the S&P 100 from Apple to Bank of America Corp. (BAC) have gained 7.7 percent in 2012, compared with 5.1 percent for a version of the S&P 500 that strips out weightings for market value, the widest margin since 1999, data compiled by Bloomberg show. With price-earnings ratios down 6.6 percent this quarter to 12.7 and payouts at 2.2 percent of share prices, analysts raised buy recommendations for the group to the highest level since 2007.

The biggest stocks are showing corporate America’s resilience even though Mitt Romney, the presumptive Republican candidate in this year’s national election, criticized President Barack Obama earlier this month for saying the private sector is “doing fine.” A second year of record profits is helping the S&P 100 beat every developed market index in the world as investors seek the relative safety of the U.S. after $5.1 trillion was erased from global equities since March 27.

“The mega-caps are just cheap compared to other segments of the stock market,” Russ Koesterich, the San Francisco-based global chief investment strategist for the IShares unit of BlackRock Inc., said in a June 14 phone interview. His firm oversees $3.68 trillion. “There are a lot of things that are wrong in the economy, to state the obvious, and these are companies that have the wherewithal to survive.”

Have a wonderful weekend everyone!

”You must be the change you want to see in the world.” – M.K. Gandhi

Regards,

Amanda Bourke

Assistant to Carolann Steinhoff

Queensbury Securities Inc.

 

St. Andrew’s Square

Suite 340A, 730 View St.,

Victoria, B.C. V8X 3Y7

Tel: 778-430-5808

Fax: 778-430-5838

 

Dear Friends,

Tangents:

This Sunday is Father’s Day so I thought that I might share with you this sweet gallery of quotes from famous fathers put together by the Globe and Mail.

http://www.theglobeandmail.com/life/parenting/fathers-day/famous-fathers-on-daddyhood-pride-joy-and-diapers/article4235559/#gallery_1752=0

I really like number eight by Chris Rock: ‘Every day I’m proud to be a dad. When you have kids, there’s no such thing as quality time. There’s just time. There’s no, “Ooh, his graduation’s better than going to the mall.” It’s all kind of equal. Changing her diaper and her winning a contest – it’s all good.’

Originally I was thinking of sharing some words of wisdom from my own father but after a couple of rather awful and embarrassing moments, I realized couldn’t think of anything.  But the more I thought on it, the better I understood why; my Dad’s always been better with silences. Some of my best memories with my dad are of just the two of us going on a hike in the woods and enjoying nature and each other’s company. Simply letting your surroundings take you in is something I have always struggled with. I fidget, get restless, and inevitably do something to break the silence. Yet comfortably settling into a moment is something my dad does so effortlessly.  While I may have not mastered this talent, it is one of my favorite lessons that I have learned from my father and one I feel I get closer to understanding with each walk in the woods we share.

So Happy Father’s Day to all the dads out there, may you all find your own moments of happiness, calm, and quiet.

Today in History June 15

1215		King John signs the Magna Carta.
1775		George Washington is named Commander in Chief by Congress.
1916		President Woodrow Wilson signs a bill incorporating the Boy Scouts of America.
1947		The All-Indian Congress accepts a British plan for the partition of India.
1958		Greece severs military ties to Turkey because of the Cyprus issue.
1964		The last French troops leave Algeria.
1977		The first general election in Spain since 1936 results in victory for the UCD (Union of Democratic Centre).

photos of the day June 15, 2012

Tibet’s exiled spiritual leader the Dalai Lama answers questions at a news conference in Manchester, northern England.

-Phil Noble/Reuters

A member of the street-side audience waves at American-Japanese illusionist ‘Cyril’ as he performs a stunt where he appears suspended in the air from a lamp post in Mumbai. The stunt was part of the promotional road show for a new TV program featuring Cyril.

Vivek Prakash/Reuter

Market Closes for June 15, 2012:

North American Markets

Market  Index	Close	Change
Dow  Jones	12767.17	+115.26
		+0.91%
S&P 500	1342.84	+13.74
		+1.03%
NASDAQ	2872.80	+36.47
		+1.29%
TSX	11524.90	+58.48
		+0.51%

International Markets

Market  Index	Close	Change
NIKKEI	8569.43	+0.43
		+0.01%
HANG  SENG	19233.94	+425.54
		+2.26%
SENSEX	16949.83	+271.95
		+1.63%
FTSE 100	5478.81	+11.76
		+0.22%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	1.731	1.794
CND.   30 Year Bond	2.344	2.374
U.S.   10 Year Bond	1.5840	1.6369
U.S.   30 Year Bond	2.6942	2.7297

Currencies

BOC Close	Today	Previous
Canadian $	1.02218	1.02354
US   $	0.97830	0.97700
Euro Rate  1 Euro=		Inverse
Canadian   $	1.29445	0.77253
US  $	1.26636	0.78966

Commodities

Gold	Close	Previous
London Gold   Fix	1624.90	1625.26
Oil	Close	Previous
WTI Crude Future	84.03	83.91
BRENT	97.93	98.32

 

Market Commentary:

Canada

By Steve Chambers and Katia Dmitrieva

June 15 (Bloomberg) —  Canadian stocks rose after energy companies snapped a two-day losing streak as speculation grew that central banks will take steps to bolster economic growth.

Energy stocks and banks contributed most to the rally in the Standard & Poor’s/TSX Composite Index, rising at least 0.3 percent as a group. Suncor Energy Inc. rose 1.7 percent, following two straight losses, while Canadian Natural Resources Ltd. increased 1 percent.

The S&P/TSX gained 35.79 points, or 0.3 percent, to 11,502.21 at 12:39 p.m. in Toronto, erasing a weekly loss. The benchmark gauge tumbled 6.3 percent in May, sinking to the lowest level since October during the month. Energy shares in the index retreated 11 percent this year through yesterday, while raw-material companies slumped 9.1 percent.

“There’s been a substantial decline in energy prices, crude and natural gas,” Jamie Robertson, chief investment officer at McLean & Partners Wealth Management in Calgary, said in a phone interview. The firm manages C$900 million ($879 million). “Some people’s ears are perking up to the low prices.”

Policy makers from the U.K. to Japan and Canada stepped up warnings about the threat to world financial markets should Europe fail to contain its debt crisis, with speculation rising that they are prepared to act if Greek elections this weekend spark turmoil in the markets.

Energy producers in the S&P/TSX slumped even as oil and natural gas slumped. The index trades for 15.5 times reported earnings, near the 2 1/2-year low of 14.9 reached earlier this month. Crude slumped to an eight-month low of $81.07 this week. Suncor rose 1.7 percent to C$29. Canadian Natural Resources rose 1 percent to C$27.54. Natural gas provider Encana Corp. rose 3.3 percent to C$22.09.

Royal Bank of Canada rose 0.4 percent to C$51.03, trimming its year-to-date slump to 1.8 percent.

Jaguar Mining Inc. surged 8.3 percent, the biggest gain in the S&P/TSX, to C$1.44.

Research In Motion Ltd. rallied 4.6 percent, the most since March 30, to C$11.10.

US

By Stephen Kirkland and Rita Nazareth

June 15 (Bloomberg) — Stocks rose, sending the Standard & Poor’s 500 Index to its first back-to-back weekly gain since April, as commodities and Treasuries advanced amid speculation central banks will take steps to boost growth as investors await Greek elections this weekend.

The MSCI All-Country World Index added 1.2 percent at 4 p.m. New York time, posting a second straight weekly gain. The S&P 500 increased 1 percent to 1,342.84, the highest level since May 11. The S&P GSCI Index of 24 raw materials added 0.1 percent. Yields on 10-year Treasuries dropped six basis points to 1.58 percent. The yen gained against 14 of 16 major peers.

Policy makers from the U.K. to Japan and Canada stepped up warnings about the threat to world financial markets should Europe fail to contain its debt crisis. Greek elections June 17 may determine whether the country upholds austerity measures attached to international aid and remains in the euro bloc. Reports on U.S. industrial production and consumer confidence trailed projections.

“There’s hope of some coordinated action if bad news does occur,” said Tim Ghriskey, who oversees about $2 billion as chief investment officer of Solaris Group in Bedford Hills, New York. “That seems to be supporting the stock market. Yet investors are still skittish. There’s the Greek election. It could be an ongoing process.”

All of the 10 main industries in the S&P 500 rallied as energy and technology shares had the biggest gains.

Microsoft Corp. increased 2.3 percent as a person familiar with the matter said the company will announce plans next week to sell a table computer running the next version of Windows.

Intercontinental Exchange Inc. advanced 4.7 percent after its bid for the London Metal Exchange was rejected in favor of Hong Kong Exchanges & Clearing Ltd.’s offer. Facebook Inc. rose 6.1 percent, completing the first weekly gain since it went public last month.

The Stoxx Europe 600 Index climbed 1 percent. Banks rebounded after the Bank of England said it will provide billions of pounds of emergency aid to U.K. lenders. Barclays Plc jumped 4.2 percent, Lloyds Banking Group Plc added 5.2 percent and Royal Bank of Scotland Group Plc surged 7.9 percent. The central bank will allow the lenders to swap assets for money they can loan to companies and households.

European Union leaders will press for new efforts to boost the area’s economy and improve lending conditions, according to a draft document prepared for a June 28-29 summit in Brussels. Steps include introducing so-called project bonds, making better use of EU infrastructure funds and increasing the capital, and therefore lending power, of the European Investment Bank, according to the June 12 draft.

Gold futures added 0.5 percent to $1,628.10 an ounce, rallying for a sixth straight day. Copper rose 0.9 percent to $3.3835 a pound. Natural gas slipped 1.1 percent after surging 14 percent yesterday.

Treasuries rose as lower-than-estimated economic reports reinforced speculation that the Fed will add to stimulus measures, stoking investor demand for the safety.

Industrial production in the U.S. unexpectedly fell in May for the second time in three months as factories turned out fewer vehicles and consumer goods. Output at factories, mines and utilities decreased 0.1 percent last month after a revised 1 percent gain in April, the Fed reported today in Washington.

Economists forecast a 0.1 percent advance, according to the Bloomberg News survey median.

Confidence among U.S. consumers declined in June to the lowest level this year as the labor market showed few signs of improving. The Thomson Reuters/University of Michigan index of consumer sentiment fell to 74.1 from the May reading of 79.3, which was the highest since October 2007. The gauge was projected to fall to 77.5, according to a median forecast of 66 economists surveyed by Bloomberg News.

The yen strengthened the most in two weeks against the dollar after the Bank of Japan refrained from expanding monetary stimulus that debases the currency. The yen appreciated 0.8 percent to 78.68 per dollar, the biggest gain since May 31. It advanced 0.7 percent to 99.58 per euro.

Have a wonderful weekend everyone!

“People take different roads seeking fulfi9llment and happiness. Just because they’re not on your road doesn’t mean they’ve gotten lost.”

? Dalai Lama

Regards,

Ellora Howie

Assistant to Carolann Steinhoff

 

Queensbury Securities Inc.,

St. Andrew’s Square

Suite 340A, 730 View St.,

Victoria, B.C. V8X 3Y7