Month: August 2013

Dear Friends,

Tangents:

As Carolann is out of the office this afternoon, I will be sending the newsletter on her behalf.

Are you a fan of Indian Food? I was reading an Times Colonist and came across an article about Indian Food.  Chef Raghavan Iyer has released a cooking book titled “Indian Cooking Unfolded”, which shares the basics of Indian cooking.  It gives detailed instructions, with simple recipes that usually include fewer than 10 ingredients.  I thought I would share one with you:

Creamy Chicken Kebabs

1/2 cup half-and-half

6 medium-sized cloves of garlic

4 pieces fresh ginger (each about the size and thickness of a quarter; no need to peel the skin)

1 1/2 tsp. coarse kosher or sea salt

1 tsp garam masala spice mix

1/2 tsp cayenne pepper

1 1/2 lb skinless, boneless chicken breasts, cut at a diagonal into centimeter-wide strips

nonfat cooking spray

1 small red onion, cut in half lengthwise and thinly sliced

2 Tbsp finely chopped fresh cilantro, leaves and tender stems

1 large lime, cut into 8 wedges

To get the cooking instructions for this delicious recipe visit:

http://www.timescolonist.com/life/creamy-chicken-kebabs-take-taste-buds-to-india-1.586348

“Develop success from failures. Discouragement and failure are two of the surest stepping stones to success.” – Dale Carnegie

Photos of the Day –August 15^th, 2013

A station clock is pictured at a platform of the main train station in Mainz, Germany. German rail operator Deutsche Bahn cancelled most of its regional service in Mainz due to lack of personnel. Ralph Orlowski/Reuters

A taxi is driven past a trash bin in central London. Officials say that an advertising firm, Renew, must immediately pull the plug on a program using its network of high-tech trash cans like the one pictured, which measures the Wi-Fi signals emitted by smartphones to track people walking through London’s financial district. Lefteris Pitarakis/AP

Market Closes for August 15^th, 2013

Market  Index	Close	Change
Dow  Jones	15112.19	-225.47    -1.47%
S&P 500	1662.51	-22.88    -1.36%
NASDAQ	3606.117	-63.156    -1.72%
TSX	12685.68	+46.38
		+0.37%

International Markets

Market  Index	Close	Change
NIKKEI	13752.94	-297.22
		-2.12%
HANG  SENG	22539.25	-1.88
		-0.01%
SENSEX	19367.59	+137.75
		+0.72%
FTSE 100	6483.34	-104.09
		-1.58%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	2.677	2.628
CND.   30 Year Bond	3.148	3.100
U.S.   10 Year Bond	2.7700	2.7081
U.S.   30 Year Bond	3.8176	3.7462

Currencies

BOC Close	Today	Previous
Canadian $	0.97051	0.96748
US   $	1.03038	1.03361
Euro Rate  1 Euro=		Inverse
Canadian   $	1.37561	0.72695
US  $	1.33505	0.74904

Commodities

Gold	Close	Previous
London Gold   Fix	1364.03	1335.50
Oil	Close	Previous
WTI Crude Future	107.33	106.83
BRENT	109.359	109.359

Market Commentary:

Canada

By Eric Lam

Aug. 15 (Bloomberg) — Canadian stocks rose to a three-week high, as commodities producers rallied after unrest in Egypt sent crude higher and gold surged amid concern the U.S. Federal Reserve will curb stimulus measures.

Eldorado Gold Corp. and Iamgold Corp. soared more than 7.7 percent as gold rose to an eight-week high. Bankers Petroleum Ltd. jumped 5.7 percent to pace gains among energy producers.

Brookfield Asset Management Inc. declined 3.4 percent after existing home sales in July recorded their smallest gain in five months. Valeant Pharmaceuticals International Inc. slid 1.1 percent, giving health-care stocks the biggest drop in the benchmark index.

The Standard & Poor’s/TSX Composite Index rose 65.22 points, or 0.5 percent, to 12,704.52 at 4 p.m. in Toronto, the highest since July 23. Trading volume was 31 percent higher than the 30-day average at this time of the day.

“The tapering view has been reinforced today,” said Andrew Pyle, a fund manager with ScotiaMcLeod Inc. in Peterborough, Ontario. He manages about C$210 million ($204 million). “Gold is picking up because of the volatility in bonds and stocks, and then you also have what’s going on in Egypt, which is a very significant development given the extent of what’s happening. Any type of volatility in that region tends to support crude prices due to supply disruptions.”

The S&P/TSX erased earlier losses of as much as 0.6 percent, initially following U.S. and global equities lower amid concern the Fed will withdraw stimulus this fall after data showed U.S. jobless claims dropped to the lowest level in almost six years.

The central bank has said it will consider reducing its monthly bond purchases as the economy shows signs of improvement. The tapering concerns drove U.S. Treasury yields to two-year highs and gave U.S. equities the worst drop since June.

Monetary support has bolstered equities around the world.

The tumble in global stocks — only four of 24 developed markets rose today — boosted demand for gold as an alternative investment. The metal traded above $1,350 for the first time since June 20, reversing an earlier decline of as much as 1.2 percent. Oil rose for a fifth day as unrest in Egypt bolstered concern supplies could be cut. Commodity stocks account for nearly 39 percent of S&P/TSX.

Materials producers rallied 3.8 percent and energy companies added 0.8 percent, as four out of 10 groups in the benchmark index advanced.

Eldorado Gold soared 7.7 percent to C$9.50 and Iamgold climbed 11 percent to C$6.66. Centerra Gold jumped 11 percent to C$6.20, extending its winning streak to seven days, the longest since May 2012.

Suncor Energy Inc. advanced 3.5 percent to C$34.97, the highest since January, after Warren Buffett’s Berkshire Hathaway Inc. reported a stake in the energy producer.

Buffett’s firm owned 17.8 million Suncor shares on June 30, valued at more than $500 million, Berkshire said today in a regulatory filing.

Five energy stocks rose for every one that fell, led by a 5.7 percent surge in Bankers Petroleum to C$3.32.

Telus Corp. rallied 4.8 percent to C$32.21 and Rogers Communications Inc. gained 5 percent to C$42.45 to pace gains among phone stocks. The Globe and Mail reported that Verizon Communications Inc. has delayed possible takeover bids for smaller wireless carriers Wind Mobile and Mobilicity, without naming sources.

Financial stocks lost 0.6 percent, as data showed existing home sales in Canada rose 0.2 percent last month, down from a 3.3 percent pace in June and 3.6 percent in May. Toronto- Dominion Bank, Canada’s second-largest lender, slid 0.6 percent to C$86.75

Brookfield Asset Management dropped 3.4 percent to C$37.01 and Canadian Apartment Properties Real Estate Investment Trust retreated 0.6 percent to C$20.68 to pace declines among real- estate stocks.

Valeant Pharmaceuticals slid 1.1 percent to C$106.12, extending a two-day decline after closing at a record Aug. 13.

The drop helped drag health-care stocks 1.4 percent lower as a group.

US

By Alex Barinka and Katie Brennan

Aug. 15 (Bloomberg) — U.S. stocks fell the most since June as forecasts from Cisco Systems Inc. and Wal-Mart Stores Inc. disappointed while improving economic data pushed bond yields higher amid concern the Federal Reserve will reduce stimulus.

All 10 major industries in the S&P 500 retreated, with technology and consumer-discretionary shares dropping more than 1.7 percent. Cisco and Wal-Mart lost at least 2.6 percent after reporting earnings. Gannett Co. tumbled 5.1 percent after Warren Buffett’s Berkshire Hathaway Inc. exited its stake in the newspaper publisher. Homebuilders rallied as confidence in the industry rose to the highest level since 2005 despite rising mortgage rates.

The Standard & Poor’s 500 Index slipped 1.4 percent, the most since June 20, to 1,661.32 at 4 p.m. in New York. The Dow Jones Industrial Average dropped 225.47 points, or 1.5 percent, to 15,112.19, the lowest level since July 3. About 6.6 billion shares exchanged hands on U.S. exchanges today, 4.5 percent above the three-month average. Treasury yields rose to the highest levels in two years.

“With weaker earnings, higher interest rates and geopolitical concerns, risk assets like stocks don’t do well in that type of environment,” Jim Russell, the senior equity strategist for U.S. Bank Wealth Management, said in an interview from Cincinnati. His firm oversees $110 billion. “The jobless claims numbers were sufficiently strong that taper fears are probably front and center in terms of display today.”

Reports today showed claims for jobless benefits unexpectedly dropped last week to the lowest level in almost six years, signaling the U.S. job market continues to mend. The cost of living rose in July for a third month, supporting the Fed’s forecast that inflation will move closer to its target.

Industrial production in the U.S. was unchanged in July.

Separate Fed reports showed manufacturing in the Philadelphia and New York regions expanded in August at a slower-than- anticipated pace.

“We could still be in an environment where the market is having difficulty digesting some positive data points because of the possible end result of tapering happening sooner or more forcefully than we would like,” Kristina Hooper, U.S. head of investment and client strategies at Allianz Global Investors, said in an interview from Frankfurt. Her firm oversees more $409 billion.

The Fed, led by Chairman Ben S. Bernanke, will probably reduce its $85 billion in monthly bond purchases at its meeting on Sept. 17-18, according to 65 percent of economists surveyed by Bloomberg from Aug. 9 to Aug. 13. In a survey last month, half of economists predicted a reduction at next month’s meeting. The first step may be small, with monthly purchases tapered by $10 billion to a $75 billion pace, the survey showed.

Central-bank stimulus helped propel the S&P 500 up more than 150 percent from its low in 2009. The rally that sent the index up 20 percent in 2013 to a record 1,709.67 on Aug. 2 was the broadest in at least 23 years, with 445 companies higher for the year on that date.

Since peaking, the benchmark gauge for U.S. equities has retreated 2.8 percent, while the Russell 2000 measure of small- cap stocks has dropped 3 percent, the S&P 500 Financials Index has fallen 3.7 percent and the Dow Jones Transportation Average has slid 4.7 percent, data compiled by Bloomberg show.

Turmoil in Egypt is also weighing on markets. Hundreds of supporters of ousted President Mohamed Mursi torched government headquarters in Giza, as the death toll rose above 500 after a crackdown on Islamists calling for his reinstatement.

Today’s decline broke a month-long fluctuation for the S&P 500 and ended the calmest trading period in six months. The benchmark index was confined to a 35-point range from July 11 through yesterday, with intraday price changes averaging 0.68 percent over the past 30 days, the smallest swing over a comparable period since Feb. 19, data compiled by Bloomberg show.

The Chicago Board Options Exchange Volatility Index, or VIX, climbed 13 percent today to 14.73, the highest level since July 8. The equity volatility gauge has jumped 24 percent since Aug. 5.

The Morgan Stanley Cyclical Index fell 1.5 percent, the most since June 24. Consumer-discretionary stocks had the biggest retreat among S&P 500 groups, tumbling 1.8 percent. Home Depot Inc. dropped 3 percent to $75.14, extending a two-day decline to 5.4 percent.

The KBW Bank Index slumped 1.2 percent as all 24 members decreased. Citigroup Inc. lost 1.4 percent to $50.86 and JPMorgan Chase & Co. dropped 1.6 percent to $53.29.

Wal-Mart, the world’s largest retailer, fell 2.6 percent to $74.41. The world’s largest retailer cut its annual profit forecast after shoppers’ reluctance to buy more than the bare necessities hurt second-quarter sales.

Cisco sank 7.2 percent to $24.49 as the biggest maker of networking equipment said revenue for the current quarter through October will be $12.2 billion to $12.5 billion. Analysts on average had projected sales of $12.5 billion.

The company is eliminating 4,000 jobs amid weaker sales in Japan, China and Europe, Chief Executive Officer John Chambers said on a conference call yesterday.

Semiconductor companies tumbled 2.3 percent as a group.

Micron Technology Inc. dropped 4.7 percent to $14.13. Advanced Micro Devices Inc. slid 3.4 percent to $3.69.

“The second half of the year is supposed to be so great, but then Wal-Mart’s earnings are lackluster and so limp, and Cisco is saying things are not as great as they were last quarter,” Chad Morganlander, a Florham Park, New Jersey-based money manager who helps oversee about $130 billion at Stifel Nicolaus & Co., said in a telephone interview. “This is a reminder that although economic deceleration has abated, earnings for corporations across the globe are hard to come by.”

Of the 463 companies in the benchmark index that have reported quarterly results this period, 72 percent have exceeded analysts’ profit estimates, data compiled by Bloomberg show.

Some 55 percent have topped forecasts for revenue.

Gannett, which has proposed buying Belo Corp., slid 5.1 percent to $24.29. A filing showed that Buffett’s Berkshire Hathaway exited its stake in Gannett during the second quarter.

Automotive stocks fell the most among 24 industries in the S&P 500. Ford Motor Co. retreated 2.7 percent to $16.43. Delphi Automotive Plc slid 2.4 percent to $54.20 after filings showed a selloff of shares as of June 30 by holders including David Einhorn’s Greenlight Capital Inc., Dan Loeb’s Third Point LLC, John Paulson’s Paulson & Co. and Paul Singer’s Elliott Management Corp.

Onyx Pharmaceuticals Inc. declined 7.2 percent to $115.34.

Talks over Amgen Inc.’s proposed takeover of the maker of blood- cancer medication have stalled over a dispute about access to data from an ongoing drug trial even as the two sides have a general agreement on price, said three people familiar with the matter.

“Amgen does not comment on market rumors,” said Christine Regan, a spokeswoman for the Thousand Oaks, California-based company. Lori Melancon, a spokeswoman for Onyx, declined to comment on the report of the talks.

Hewlett-Packard Co. retreated 4.5 percent to $25.95. Rival Lenovo Group Ltd. reported first-quarter profit that beat analyst estimates after increasing its global market share for tablet computers, smartphones and personal computers.

An S&P index of homebuilders rallied 4.4 percent, reversing an earlier decline of as much as 3.3 percent. Confidence in the industry rose in August to the highest level since 2005, a report showed today, as demand for new homes supports the market amid rising mortgage rates. The homebuilders index slumped 10 percent this year through yesterday, when it closed at the lowest level since November.

D.R. Horton Inc. climbed 5.7 percent to $19.12, halting an eight-day decline. PulteGroup Inc. surged 5.3 percent to $15.91.

KB Home rose 5.3 percent to $17.21. Lennar Corp. increased 5.1 percent to $33.28.

Newmont Mining Corp. gained 4 percent to $33.22 after gold futures jumped to an eight-week high as demand for the metal as an alternative investment increased. Gold’s rally followed a 20 percent plunge for the year through yesterday amid the U.S. equity rally and low inflation.

Kohl’s Corp. surged 5.3 percent to $53.51. The third- largest U.S. retailer forecast sales for this quarter that beat some analysts’ estimates. Chief Financial Officer Wes McDonald told investors on a conference call that Kohl’s was “very pleased” with initial back-to- school sales.

Estee Lauder Cos. climbed 3.4 percent to $67.36 after the makeup manufacturer’s fourth-quarter earnings beat estimates.

 

Have  a wonderful evening everyone!

 

Be magnificent!

 

“Watch your thoughts; they become words.
Watch your words; they become actions.
Watch your actions; they become habits.
Watch your habits; they become character.
Watch your character; it becomes your destiny.”

—Lao-Tze

 

As ever,

 

Amanda Bourke

Assistant to Carolann Steinhoff

Queensbury Securities Inc.

 

Dear Friends,

Tangents:

As Carolann is out of the office this afternoon, I will be sending the newsletter on her behalf.

Looking for a new way to travel around downtown Victoria?  Check out the Victoria Harbour Ferry! Offering about 16 designated pick-up spots and stops for shopping, eating, touring and sleeping, Victoria Harbour Ferry offers tours, charters and a hop-on, hop-off taxi service from 10 a.m. to 9 p.m. throughout the summer. The delight for many passengers is the discovery that the journey might be the best part of the trip. Hop-on and hop-off locations cost as little as $5 per person for most destinations from the Fairmont Empress dock within the Inner Harbour, $10 further out and $15 for locations including Bamfield Park and Tillicum Landing at Tillicum Road. It’s a fun way to travel and see the beautiful sights our gorgeous city has to offer!

“Don’t cry because it’s over, smile because it happened.” ― Dr. Seuss

Photos of the Day –August 14^th, 2013

South Koreans take part in a candlelight demonstration demanding the resignation of President Park Geun-Hye and calling for reform at the national spy agency in central Seoul. According to local media reports, the spy agency’s former chief Won Sei-hoon, who served under the regime of former President Lee Myung-Bak, was indicted on June 14, 2013 on charges of ordering an online smear campaign to sway public opinion in favor of the ruling Saenuri Party candidate Park Geun-hye before last December’s presidential election, in violation of the country’s election law. Lee Jae-Won/Reuters

A woman stands on a lotus-shaped island as a boatman takes tourists for a ride around a lake at Zizhuyuan Park, known as Purple Bamboo Park in Beijing, China. Purple Bamboo Park, one of the seven biggest parks in Beijing, is a classical Chinese garden which draws many tourists. Andy Wong/AP

Market Closes for August 14^th, 2013

Market  Index	Close	Change
Dow  Jones	15337.66	-113.35    -0.73%
S&P 500	1685.34	-8.82    -0.52%
NASDAQ	3669.273	-15.170    -0.41%
TSX	12651.33	+9.14
		+0.07%

International Markets

Market  Index	Close	Change
NIKKEI	14050.16	+183.16
		+1.32%
HANG  SENG	22541.13	+269.85
		+1.21%
SENSEX	19367.59	+137.75
		+0.72%
FTSE 100	6587.43	-24.51
		-0.37%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	2.628	2.624
CND.   30 Year Bond	3.100	3.096
U.S.   10 Year Bond	2.7081	2.7181
U.S.   30 Year Bond	3.7462	3.7577

Currencies

BOC Close	Today	Previous
Canadian $	0.96748	0.96658
US   $	1.03361	1.03457
Euro Rate  1 Euro=		Inverse
Canadian   $	1.37017	0.72984
US  $	1.32561	0.75437

Commodities

Gold	Close	Previous
London Gold   Fix	1335.50	1321.57
Oil	Close	Previous
WTI Crude Future	106.85	106.83
BRENT	109.359	109.359

Market Commentary:

Canada

By Eric Lam

Aug. 14 (Bloomberg) — Canadian stocks fell for the first time in three days, retreating from a two-week high, as retailers including Rona Inc. retreated on weaker-than-estimated results.

Rona dropped 3.7 percent as earnings fell short of projections. Metro Inc. fell the most since May 2010 after announcing it will take a C$40 million ($39 million) charge to reorganize its Ontario store network and that sales fell short of estimates. First Majestic Silver Corp. and Silvercorp Metals Inc. rallied at least 7.6 percent to lead raw-materials producers higher as the metal advanced for a fifth day.

Three stocks fell for every two that rose as the Standard & Poor’s/TSX Composite Index slipped 2.89 points, or less than 0.1 percent, to 12,639.30 at 4 p.m. in Toronto. The index swung as high as 0.2 percent and as low as 0.2 percent.

“The Canadian economy is growing marginally slower than the U.S., so companies missing estimates is to be expected,” said Anish Chopra, a fund manager with TD Asset Management Inc. in Toronto. The firm manages C$216 billion. “When you look at precious metals, for both gold and silver the pricing has come down significantly so there are people who think there’s value at these levels.”

Economists estimate Canadian gross domestic grew 1.6 percent in the second quarter, according to a Bloomberg survey.

The U.S economy expanded by 1.7 percent in that period.

Eight of 10 main industries in the gauge fell, with consumer staples stocks dropping 1.4 percent. Materials producers added 2.3 percent as a group.

Metro declined 3.7 percent to C$69.30, the lowest since July 5. Canada’s third largest grocery chain reported a 0.9 percent drop in same-store sales last quarter, the worst result in at least 10 years, data compiled by Bloomberg show. The figure measures performance at locations open for at least a year. Metro reported sales of C$3.57 billion in the period, compared with analysts’ estimates for C$3.64 billion.

Rona dropped 3.7 percent to C$10.84. The country’s largest home-improvement store chain posted second-quarter adjusted earnings of 28 Canadian cents, short of the 33 cents estimated by analysts.

Same-store sales fell 1 percent in the quarter, affected by poor weather, a June strike in the Quebec construction industry and falling housing starts across the country, Rona said in a statement.

Silvercorp Metals soared 7.6 percent to C$3.84, highest in four months, and First Majestic jumped 9.3 percent to C$14.85.

Silver rallied for a fifth straight day, advancing 12 percent in that time. The metal remains 28 percent lower in 2013.

Kinross Gold Corp. added 6.5 percent to C$5.94 and Iamgold Corp. rose 6.9 percent to C$6.01 as the price of gold increased for the fifth time in six sessions. The metal had fallen 21 percent this year through yesterday.

Teck Resources Ltd. gained 2.7 percent to C$28.42, the highest since May, as copper traded near a nine-week high.

Bankers Petroleum Ltd. climbed 3 percent to C$3.14. Oil revenue surged 34 percent to $131.8 million as production rose to 17,866 barrels a day in the second quarter, compared with 14,161 barrels a year ago.

Bankers said it will ramp up spending on surface facilities in the second half of the year, including the potential acquisition of a sixth drilling rig that should allow the company to reach the “high-end of our annual guidance,” Chief Executive Officer David French said in a statement.

US

By Nick Taborek and Lu Wang

Aug. 14 (Bloomberg) — U.S. stocks fell, sending the Standard & Poor’s 500 Index lower for the sixth time in eight days, after economists predicted the Federal Reserve will reduce stimulus in September as European data added to signs that the global economy is strengthening.

Macy’s Inc. fell 4.5 percent as the department-store chain cut its profit forecast after weaker-than-estimated sales.

Homebuilders and utility stocks slumped amid rising bond yields.

Apple Inc. rose 1.8 percent, extending a rally after billionaire investor Carl Icahn said yesterday he’s a shareholder. Cisco Systems Inc. tumbled 9.4 percent after the close of regular trading as it plans to cut 4,000 jobs.

The S&P 500 lost 0.5 percent to 1,685.39 at 4 p.m. in New York, the lowest level since July 29. The benchmark gauge has dropped 1.4 percent since a record high on Aug. 2. The Dow Jones Industrial Average declined 113.35 points, or 0.7 percent, to 15,337.66, the lowest since July 10. About 5.4 billion shares changed hands on U.S. exchanges, 14 percent below the three- month average.

“The market is scope-locked on Fed tapering in September,” Douglas Cote, chief market strategist at ING U.S.

Investment Management in New York, said in a telephone interview. His firm oversees $190 billion. “Quantitative easing is creating some excess in the financial system. The last thing Bernanke wants when he finishes his term is to be responsible for the next bubble.”

The S&P 500 has fallen from a record high this month on growing speculation the Fed will pare stimulus, or quantitative easing, this year. Central bank stimulus helped propel the S&P 500 up more than 150 percent from its bear-market low in 2009.

The Fed, led by Chairman Ben S. Bernanke, will probably reduce its $85 billion in monthly bond purchases at its meeting on Sept. 17-18, according to 65 percent of economists surveyed by Bloomberg from Aug. 9 to Aug. 13. In a survey last month, half of economists predicted a reduction at next month’s meeting.

A report today showed wholesale prices in the U.S. were little changed in July, reflecting the biggest drop in auto costs in four years. Fed policy makers continue to see inflation running below the central bank’s 2 percent goal even as the expansion picks up in the second half of the year.

Separate data showed the euro area’s economy emerged from a record-long recession in the second quarter, led by Germany and France. Gross domestic product expanded 0.3 percent after a 0.3 percent contraction in the first quarter, the European Union’s statistics office said.

Fed Bank of St. Louis President James Bullard, who has backed continued bond purchases by the Fed, said policy makers should be careful in changing course based solely on their economic forecasts, which have proven in the past to be too rosy.

Federal Open Market Committee forecasts “have tended to be too optimistic over the last several years,” Bullard, who votes on monetary policy this year, said today in the text of prepared slides for a speech in Paducah, Kentucky. “Given this experience, I think caution is warranted in taking policy action based on forecasts alone.”

Last week, Charles Evans, Sandra Pianalto and Richard Fisher, regional Fed presidents in Chicago, Cleveland and Dallas, said the central bank may be closer to tapering as the labor market recovers. Fed Bank of Atlanta President Dennis Lockhart said yesterday that policy makers may start to slow buying at any of their next few meetings amid “uneven performance” by the economy.

“The market is beginning to get a little nervous of the fact that most things are probably lining up towards a taper,” Burt White, chief investment officer who helps oversee $390 billion at LPL Financial in Boston, said in a phone interview.

“If you look at the data that’s been coming through in the last week or so, they’ve been supportive of taper.”

The Chicago Board Options Exchange Volatility Index, or VIX, rose 5.9 percent to 13.04. The equity volatility gauge reached its highest level this year in June and has since fallen 36 percent.

Nine of 10 S&P 500 industries slipped today as health-care and consumer-discretionary stocks fell the most, sinking at least 0.7 percent. Home Depot Inc. slid 2.5 percent to $77.44, for the largest drop in the Dow.

Macy’s fell 4.5 percent to $46.33. Chief Executive Officer Terry Lundgren used promotions during the quarter to clear inventory that had built up as a cool spring curtailed purchases of summer clothing and the bumpy economy restrained consumers’ spending.

Boeing Co. lost 2 percent to $104.16. The company’s 787 Dreamliner suffered a fresh setback after ANA Holdings Inc., the model’s biggest operator, said it discovered wiring defects in the fire-suppression system on three aircraft. Boeing’s flagship jet is already under scrutiny following a fire in London last month that U.K. investigators linked to an emergency beacon.

An S&P gauge of homebuilder stocks sank 1.8 percent to the lowest since November as yields on Treasuries approached the highest level this year, spurring concern rising interest rates will hinder a housing recovery. Ten of the index’s 11 members declined. PulteGroup Inc. slid 1.7 percent to $15.11. D.R. Horton Inc. fell 2.4 percent to $18.09 for an eighth day of losses.

US Airways Group Inc. slumped 1.2 percent to $16.17, extending its two-day slide to 14 percent. The U.S. Justice Department yesterday recommended blocking a proposed American Airlines-US Airways merger, saying the deal would lead to less competition in the industry and higher prices for consumers.

TripAdvisor Inc. tumbled 9.2 percent to $73.55 for the biggest drop in the S&P 500. The online travel research company fell after an executive speaking at the Canaccord Genuity Growth Conference in Boston said summer so far has been “bumpier” than forecast and traffic is “holding but not as strong” as anticipated.

Cree Inc. plunged 22 percent to $58.83. The maker of energy-efficient lighting products predicted earnings in the first quarter will be no more than 41 cents a share, missing the average analyst estimate by 2 cents.

Moody’s Corp. declined 5.1 percent to $65.50. The owner of the second-largest credit rater declined the most in six months as the pace of bond issuance worldwide slowed this month. Sales of corporate bonds have declined 32 percent to $97.7 billion this month, compared with $144 billion in the corresponding period of August 2012, according to data compiled by Bloomberg.

JDS Uniphase Corp. lost 3.9 percent to $14.23. The provider of network analytics for the telecommunications and broadband industries forecast first-quarter revenue below analysts’s estimates.

Cisco Systems tumbled 9.4 percent to $23.90 as of 5:16 p.m.

New York time. The biggest maker of networking equipment reported fiscal fourth-quarter profit and sales in line with estimates and said it would cut 4,000 jobs, or 5 percent of its work force. The company said the environment is improving, though not at the pace it wants.

Utilities, whose 4 percent yield is the second-highest among 10 industries, dropped 0.8 percent amid concern rising bond yields will cut demand for equity income.

Apple gained 1.8 percent to $498.50, and briefly traded above $500 for the first time since January. Icahn, the billionaire activist investor who has made a career of pushing companies to make changes to boost shares, bought $1 billion worth of stock and wants Apple to allocate $150 billion for a repurchase, said a person with knowledge of his plans who asked not to be named because the investment was made privately.

The maker of iPhones and iPads has rallied 9.7 percent over three days.

Brocade Communications Systems Inc. advanced 16 percent to $7.99. The networking-equipment maker reported third-quarter profit that beat estimates as demand for its products improved.

Steinway Musical Instruments Inc. climbed 7.9 percent to $41.29. The 160-year-old piano maker agreed to be acquired by Paulson & Co., the hedge fund owned by billionaire John Paulson, in a deal valuing the company at about $512 million. The offer for $40 a share tops that of private-equity firm Kohlberg & Co., which had bid $35 a share last month for Waltham, Massachusetts- based Steinway.

Newmont Mining Corp. rallied 6.2 percent to $31.94 for the biggest gain in the S&P 500. Cliffs Natural Resources Inc. increased 2.6 percent to $24.54. Freeport-McMoRan Copper & Gold Inc. jumped 1.4 percent to $31.59. Gold prices climbed 0.6 percent while copper added 0.8 percent.

 

Have  a wonderful evening everyone.

 

Be magnificent!

 

“Be the change that you wish to see in the world.” ― Mahatma Gandhi

As ever,

 

Amanda Bourke

Assistant to Carolann Steinhoff

Queensbury Securities Inc.

 

 

Dear Friends,

As Carolann is out of the office this afternoon, I will be sending the newsletter on her behalf.

Today in History:

1889 – A patent for a coin-operated telephone was issued to William Gray.

1907 – The first taxicab started on the streets of New York City.

1932 – Adolf Hitler refused to take the post of vice-chancellor of Germany. He said he was going to hold out “for all or nothing.”

1935 – The first roller derby match was held at the Coliseum in Chicago, IL.

1942 – Walt Disney’s “Bambi” opened at Radio City Music Hall in New York City, NY.

1994 – It was reported that aspirin not only helps reduce the risk of heart disease, but also helps prevent colon cancer.

Tangents:

As back to school approaches, I thought I would share 4 tips to help your child succeed in school:

1. Set high (but not unrealistic) expectations for your child.

2. Talk to your child about school.  Ask specific questions – “What activities did you do today at school”, rather than general questions such as “How was school today?”.  This will avoid the answer “Good”, as I am sure all you parents out there have gotten many times.

3. Help your child develop good work habits and positive attitudes about learning.  Make your child excited about learning.  Find games to help them learn about the different subjects they are learning about in school.

4. Read with your child at home, in any language, even after your child can read alone.

Happy back to school shopping everyone!

“If you don’t build your dream, someone else will hire you to help them build theirs.” – Dhirubhai Ambani

Photos of the Day –August 13^th, 2013

The annual Perseid meteor shower lights the night sky behind Stonehenge in Salisbury Plain, southern England. The Perseid meteor shower is sparked every August when the Earth passes through a stream of space debris left by comet Swift-Tuttle. Kieran Doherty/Reuters

Greece’s Niki Panetta competes in the women’s triple jump qualification at the World Athletics Championships in Moscow’s Luzhniki stadium.David J. Phillip/AP

Market Closes for August 13^th, 2013

Market  Index	Close	Change
Dow  Jones	15451.01	+31.33    +0.20%
S&P 500	1694.16	+4.69    +0.28%
NASDAQ	3684.443	+14.492    +0.39%
TSX	12642.19	+47.92
		+0.38%

International Markets

Market  Index	Close	Change
NIKKEI	13867.00	+347.57
		+2.57%
HANG  SENG	22541.13	+269.85
		+1.21%
SENSEX	19229.84	+282.86
		+1.49%
FTSE 100	6611.94	+37.60
		+0.57%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	2.624	2.537
CND.   30 Year Bond	3.096	3.029
U.S.   10 Year Bond	2.7181	2.6206
U.S.   30 Year Bond	3.7577	3.6838

Currencies

BOC Close	Today	Previous
Canadian $	0.96658	0.96999
US   $	1.03457	1.03094
Euro Rate  1 Euro=		Inverse
Canadian   $	1.37210	0.72881
US  $	1.32625	0.75401

Commodities

Gold	Close	Previous
London Gold   Fix	1321.57	1336.82
Oil	Close	Previous
WTI Crude Future	106.83	106.11
BRENT	109.359	109.359

Market Commentary:

Canada

By Eric Lam and Katie Brennan

Aug. 13 (Bloomberg) — Canadian stocks rose for a second day, climbing to a two-week high, after a rally in BlackBerry Ltd. shares and health-care stocks offset declines among some gold producers on a drop in the metal’s price.

BlackBerry rose 1.5 percent after announcing yesterday it had formed a special committee to consider strategic options.

Iamgold added 2.2 percent after lowering its cost forecast for the year. Alacer Gold Corp. surged 5.7 percent after appointing a new chief executive officer. New Gold Inc. and B2Gold Corp. dropped at least 3.4 percent as the metal declined.

The Standard & Poor’s/TSX Composite Index rose 47.92 points, or 0.4 percent, to 12,642.19 at 4 p.m. in Toronto. The index has gained 1.7 percent this year after rallying 6.8 percent since June 24.

“There’s some buying going on,” said Stephen Gauthier, chief investment officer with Fin-XO Securities in Montreal. His firm manages about C$550 million ($532 million). “We’re starting to see some good companies that are cheap on a relative basis.”

Health-care and technology stocks rose the most in the S&P/TSX, adding at least 1.4 percent as six of 10 industries advanced. Trading volume was 5.1 percent higher than the 30-day average.

BlackBerry gained 1.5 percent to C$11.27, the highest since June 27. The Waterloo, Ontario-based smartphone maker has surged 19 percent in the past three days.

BlackBerry’s decision to consider takeover offers, joint ventures or partnerships is fueling speculation that investors could band together to keep the company in Canadian hands.

Fairfax Financial Holdings Ltd. Chief Executive Officer Prem Watsa, BlackBerry’s largest shareholder through his company, resigned from the BlackBerry board, raising the possibility that he may play a role in rescuing the company.

Health-care stocks rallied 2 percent, the most in the benchmark index, as Valeant Pharmaceuticals International Inc. jumped 2.5 percent to a record C$107.58.

Iamgold added 2.2 percent to C$5.62. The gold mining company said its cost-cutting program is 55 percent done, and it expects total cash costs in 2013 of $790 to $840 an ounce, compared with a previous forecast of $850 to $925 an ounce.

Iamgold, based in Toronto, reported adjusted earnings of 8 cents a share, compared with analysts’ estimates of 9 cents, according to a Bloomberg survey.

Alacer Gold climbed 5.7 percent to C$2.58 after announcing Rodney P. Antal, formerly chief financial officer, has replaced David Quinlivan as chief executive officer effective immediately.

Alacer sold its stake in an Australian mine in February and is seeking to sell its two remaining assets there after taking charges of $902 million on the unit since the last quarter of 2012.

RMP Energy Inc., based in Calgary, gained 3.5 percent to C$4.76. The oil and gas producer raised its forecast for average production to about 6,800 barrels of oil equivalent a day from 6,000 to 6,500 barrels on strong drilling and production performance in its first half.

New Gold retreated 4.4 percent to C$7.13 and B2Gold lost 3.4 percent to C$3.12. Gold fell for the first time in a week, settling 1 percent lower at $1,320.50 an ounce in New York.

US

By Lu Wang and Nick Taborek

Aug. 13 (Bloomberg) — U.S. stocks and the dollar rose while Treasuries slid as retail sales data reinforced signals the economy is expanding moderately. European shares climbed to the highest level since May as German investor confidence topped estimates, while gold weakened.

The Standard & Poor’s 500 Index added 0.3 percent at 4 p.m. in New York, erasing an earlier loss, while the Stoxx Europe 600 Index advanced 0.6 percent. Apple Inc. rallied to the highest since Jan. 23 after billionaire investor Carl Icahn disclosed a “large position” in the stock. The yield on 10-year Treasuries rose 10 basis points to 2.72 percent. The Bloomberg U.S. Dollar Index added 0.5 percent and the yen fell versus all of its 16 major peers. Gold lost 1 percent, halting a four-session rally.

U.S. retail sales rose for a fourth consecutive month in July, showing American households are regaining momentum as employment climbs. The ZEW Center for European Economic Research’s index of investor and analyst expectations rose to 42 in August, more than the 39.9 median forecast of economists in a Bloomberg survey. Japanese Prime Minister Shinzo Abe is mulling a tax cut for companies, the Nikkei newspaper reported, citing unidentified government officials.

“The general tenor of economic news has been somewhat positive and so perhaps there are some bargain hunters who are coming into the market after some days of correction,” John Carey, a fund manager at Boston-based Pioneer Investment Management Inc., said by phone. His firm oversees $211.5 billion. “I don’t know that we’re going to have a roaring recovery anytime soon, but the economy does seem to be advancing, slowly but certainly advancing, and that I think has sunk in finally.”

The S&P 500 erased earlier losses of as much as 0.4 percent, extending to a ninth day a trend where it reached its lowest point before noon, data compiled by Bloomberg show. The gauge rallied an average of 0.45 percent from its morning low to the close during the eight days through yesterday.

Hewlett-Packard Co. rose 2.1 percent after being added to Citigroup Inc.’s focus list. Bank of America Corp. and Citigroup jumped more than 0.7 percent after analyst Dick Bove said the stocks would double. D.R. Horton Inc. and PulteGroup Inc. dropped more than 1.5 percent as homebuilders slid amid rising interest rates. U.S. Airways Group Inc. sank 13 percent after the Justice Department recommended blocking a planned merger with American Airlines.

Apple rallied 4.8 percent, giving technology shares the biggest gain among 10 groups in the S&P 500. Icahn said in a Twitter post that Apple shares are extremely undervalued and the company should conduct a large buyback. The company will unveil a new iPhone at a Sept. 10 event, according to a person familiar with its plans.

The S&P 500 fell 0.1 yesterday, its fifth drop in the past six days after closing at a record on Aug. 2, amid growing speculation the Federal Reserve will pare bond purchases this year as the economy strengthens. Fed officials have been scrutinizing data to determine whether growth is strong enough to curtail stimulus.

Charles Evans, Sandra Pianalto and Richard Fisher, regional Fed presidents in Chicago, Cleveland and Dallas, said last week that policy makers may be closer to tapering debt buying.

Fed Bank of Atlanta President Dennis Lockhart, who has backed the Fed’s $85 billion in monthly bond purchases, said today that policy makers may start to slow buying at any of their next few meetings amid “uneven performance” by the economy.

The 0.2 percent increase in U.S. retail sales last month followed a 0.6 percent gain in June that was larger than previously reported, according to Commerce Department figures issued today in Washington. The median forecast of 81 economists surveyed by Bloomberg called for a 0.3 percent advance.

Treasuries dropped the most in more than a week as the retail sales report added to speculation the economy is strengthening enough for the Fed to reduce its bond-buying program.

The S&P 500 will climb 8 percent to 1,825 in the next 12 months as economic growth gains momentum, according to Goldman Sachs Group Inc. David Kostin, the bank’s chief U.S. equity strategist, recommends buying shares of companies that generate most of their revenue domestically.

“The real issue to focus on is that rising interest rates are a reflection of a better economy,” Kostin said in a Bloomberg Television interview from New York. “The best strategy right now would be here, in the U.S., from now until the end of the year.”

The Stoxx 600 climbed for a fourth day, as two shares advanced for every one that declined. EON SE jumped 3 percent after Germany’s biggest utility beat analyst earnings estimates.

GAM Holding AG, the Swiss asset manager that split from Julius Baer Group Ltd. almost four years ago, rallied 9.7 percent as profit more than tripled.

The yen depreciated 1.3 percent to 98.16 per dollar and 1 percent per euro, the most in eight weeks. Europe’s shared currency slipped 0.3 percent to $1.3264.

Gold futures for December delivery fell 1 percent to $1,320.50 an ounce on the Comex in New York, after advancing 4 percent in the previous four sessions. The commodity has slumped 21 percent this year.

Crude advanced for a third day, with West Texas Intermediate rising 0.7 percent to $106.83 a barrel, as German investor confidence and U.S. retail sales bolstered optimism that economic growth and energy demand will accelerate.

Germany’s benchmark 10-year bund yield gained 11 basis points to 1.81 percent. Spain’s yield spread over Germany fell nine basis points to 269 basis points after reaching 265, the tightest since August 2011.

The cost of insuring against losses on corporate bonds declined, with the Markit iTraxx Europe Index of credit-default swaps on 125 investment-grade companies decreasing 1 basis point to 94.7 basis points. High-yield corporate bonds rose for a 12th day in Europe, the longest stretch of gains since April, pushing borrowing costs down to the lowest in more than two months.

The MSCI Emerging Markets Index climbed 0.8 percent, advancing for a fourth day in the longest rally in almost four weeks. The Hang Seng China Enterprises Index jumped 2.6 percent to a two-month high. Russia’s Micex Index climbed 1.4 percent and India’s Sensex gained 1.5 percent. Benchmark gauges in South Korea, Taiwan, Indonesia, Thailand and the Philippines increased at least 1 percent.

 

Have  a wonderful evening everyone.

 

Be magnificent!

 

“Whenever you find yourself on the side of the majority, it is time to pause and reflect.” – Mark Twain

As ever,

 

Amanda Bourke

Assistant to Carolann Steinhoff

Queensbury Securities Inc.

 

 

Dear Friends,

Tangents:

This weekend marks the peak of Perseid meteor shower, so don’t forget to watch the night sky.  During peak activity, the rate of meteors reaches 60 or more  per hour.  Try to get outside, and away from too many bright lights to enjoy the show.

On this day in 1945, the second atomic bomb was dropped on Nagasaki, three days after Hiroshima.

If you go on with this nuclear arms race, all you are going to do is make the rubble bounce. –Sir Winston Chuchill.

Also on this day, in 1854, Thoreau published Walden or Life in the Woods, decrying Humanity’s increasing reliance on technology.

August 9^th, 1902, King Edward VII is crowned in Westminster Abby, having ascended to the British throne in 1901 upon the death of Queen Victoria.

I read this little treasure today, attributed to Anne Lamott:

Lighthouses don’t go moving all over the island looking for boats to save; they just stand there shining.

Gary and I are off to Seattle on Monday afternoon for Ring Cycle, so have a great week!  My team will send out the nightly Newsletter in my abscence.

Photos of the Day –August 9th, 2013

A visitor enjoys the Luminary tent at the 21st Sziget (Island) Festival on Shipyard Island in Budapest, Hungary. Sziget Festival is a cultural event offering art exhibitions, theatrical and circus performances and concerts. Balazs Mohai/MIT/AP

A woman takes photos of an art installation titled ‘United 65’ by Singaporean artist Ryf Zaini at a mall in Singapore. The work is comprised of 100 suspended umbrellas, each containing a secret symbol which viewers are invited to decipher. Edgar Su/Reuters

Market Closes for August 8^th, 2013

Market  Index	Close	Change
Dow  Jones	15425.51	-72.81    -0.47%
S&P 500	1691.42	-6.06    -0.36%
NASDAQ	3660.108	-9.016    -0.25%
TSX	12542.13	-10.79
		-0.09%

International Markets

Market  Index	Close	Change
NIKKEI	13615.19	+9.63
		+0.07%
HANG  SENG	21807.56	+151.68
		+0.70%
SENSEX	18789.34	+124.46
		+0.67%
FTSE 100	6583.39	+53.71
		+0.82%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	2.480	2.498
CND.   30 Year Bond	2.983	3.003
U.S.   10 Year Bond	2.5766	2.5892
U.S.   30 Year Bond	3.6345	3.6729

Currencies

BOC Close	Today	Previous
Canadian $	0.97161	0.96826
US   $	1.02922	1.03279
Euro Rate  1 Euro=		Inverse
Canadian   $	1.37324	0.72821
US  $	1.33425	0.74949

Commodities

Gold	Close	Previous
London Gold   Fix	1314.45	1312.00
Oil	Close	Previous
WTI Crude Future	105.97	103.40
BRENT	109.359	109.359

Market Commentary:

Canada

By Eric Lam

Aug. 9 (Bloomberg) — Canadian stocks fell, capping the biggest weekly loss since June, as employment unexpectedly decreased in July and profits trailed analysts’ estimates.

Dorel Industries Inc. slid 10 percent after reporting earnings that fell short of projections. Black Diamond Group Ltd. lost 6.4 percent as the company posted lower-than-estimated profit. BlackBerry Ltd. rose 5.7 percent after Reuters reported that the smartphone maker was considering going private. Magna International Inc. climbed 2.7 percent after increasing its annual sales forecast.

The Standard & Poor’s/TSX Composite Index fell 10.79 points, or 0.1 percent, to 12,542.13 at 4 p.m. in Toronto. The index has retreated 0.5 percent this week, the most since June 21. Trading volume was in line with the 30-day average.

“It’s a disappointing report,” said Michael O’Brien, fund manager with TD Asset Management Inc. in Toronto. The firm manages C$216 billion ($210 billion). “Yesterday we had an enormous move in the materials space, so today is a bit of consolidation. It’s encouraging that we’re not giving it all back.”

Raw-material producers in the S&P/TSX jumped 5.9 percent yesterday, the most since 2011, amid a rally in commodities.

Employment fell by 39,400 last month, while the jobless rate rose to 7.2 percent from 7.1 percent, Statistics Canada said today in Ottawa. Economists surveyed by Bloomberg News projected a 10,000 job gain and an unchanged jobless rate, according to the median forecasts in surveys with 23 responses.

Black Diamond Group slumped 6.4 percent to C$23.52, pacing losses among industrials shares. The group fell 1 percent, the most in the S&P/TSX, as six of 10 industries retreated.

Black Diamond, which rents temporary living spaces for workers in remote areas, reported second-quarter adjusted earnings of 21 Canadian cents a share, short of analysts’ estimates for 30 cents according to a Bloomberg survey.

The company said declines in its energy services business contributed to the weaker results during the quarter.

Dorel Industries, which makes kids’ bicycles, car seats and strollers, sank 10 percent to C$33, the most in almost five years.

The Montreal-based company reported second-quarter adjusted earnings of 45 cents, missing analysts’ projections for 82 cents a share. The company said a late spring in the U.S., Canada and Europe hurt profits. Dorel said it took a $2 million charge due to severance after cutting about 50 jobs, or 5 percent of the workforce.

Pacific Rubiales Energy Corp. slumped 6.4 percent to C$20.15, the most since April 3. The crude producer reported a 74 percent decline in second-quarter profit due to losses associated with Colombian peso depreciation and lower oil prices.

BlackBerry rose 5.7 percent to C$10.05. Chief Executive Officer Thorsten Heins and the company board are considering the idea that going private would give them the leeway to fix problems out of the public view, Reuters reported, citing unidentified sources.

An Aug. 7 report from International Data Corp. said BlackBerry’s global market share of the smartphone market in the second quarter had dropped to 2.9 percent from 4.9 percent a year ago. Google Inc.’s Android operating system owned 79 percent of market share.

Magna rose 2.7 percent to C$82.30 after the company’s sales and earnings beat analysts’ estimates and it raised its 2013 sales forecast.

Teck Resources Ltd. rose 3.9 percent to C$27.33 and First Quantum Minerals Ltd. advanced 4.8 percent to C$17.94. Copper advanced to a two-month high in New York after China’s industrial output rose 9.7 percent in July.

Teck has jumped 12 percent and First Quantum has climbed 14 percent in the past two days. Copper increased 4.2 percent this week.

US

By Nick Taborek and Sofia Horta e Costa

Aug. 9 (Bloomberg) — U.S. stocks fell, giving the Standard & Poor’s 500 Index its biggest weekly loss since June, as investors pulled money from exchange-traded funds and weighed growing signs the Federal Reserve will cut stimulus this year.

Gap Inc. dropped 3.1 percent after saying July sales at stores open at least a year rose less than analysts estimated.

J.C. Penney Co. fell 5.8 percent as its chairman sparred with the largest shareholder, Bill Ackman’s Pershing Square Capital Management LP, over who should lead the company. Cliffs Natural Resources Inc. jumped 11 percent as metals rallied after Chinese industrial output expanded faster than estimated.

The S&P 500 fell 0.4 percent to 1,691.42 at 4 p.m. in New York. The Dow Jones Industrial Average dropped 72.81 points, or 0.5 percent, to 15,425.51. The gauge lost 1.5 percent in the past five days, halting a string of six weekly advances. About 5.3 billion shares changed hands on U.S. exchanges, 16 percent below the three-month average.

“It’s been a combination of tapering and just trying to digest the new highs,” Chris Bouffard, chief investment officer of the Mutual Fund Store in Overland Park, Kansas, which oversees $8 billion, said in a phone interview. “It’s been a slow news week. It’s just a matter of the normal digestion process and people trying to get comfortable with how quickly and how far we’ve come.”

The S&P 500 has rallied 19 percent in 2013 and closed at a record 1,709.67 on Aug. 2. The gauge topped 1,700 for the first time on Aug. 1, and surpassed it twice yesterday before paring gains to close below that level. Today’s retreat left the index down 1.1 percent in the past five days, the biggest weekly slide since June 21. The Dow’s weekly decline snaps its longest winning streak since August 2012.

Investors pulled almost $1.20 billion from U.S. equity exchange-traded funds over the last four days, according to data compiled by Bloomberg from about 1,500 funds. About $32 billion of deposits went to the funds in July, the most since September 2008, the data show.

Forty stocks in the S&P 500 closed at their highest levels in 52 weeks or longer yesterday, according to data compiled by Bloomberg, compared with 193 on May 15. Less than 79 percent of the 500 companies traded above their 50-day moving averages, down from 93 percent on May 17.

Speculation the Fed will pare bond purchases in September as the economy strengthens increased this week. Charles Evans, Sandra Pianalto and Richard Fisher, regional Fed presidents in Chicago, Cleveland and Dallas, said this week the central bank may be closer to tapering as the labor market recovers. Fed stimulus has helped propel the S&P 500 up more than 150 percent from its bear-market low in 2009.

Data yesterday showed jobless claims fell in July to the lowest monthly rate since before the recession. A report today indicated inventories at U.S. wholesalers unexpectedly declined in June for the third month, the longest string in almost four years, as demand grew.

A separate report showed Chinese factory production grew faster than estimated in July, which may bolster confidence that the nation will avoid a deeper economic slowdown after larger- than-forecast gains in exports and imports as well as improvement in gauges of manufacturing and service industries.

The S&P 500 trades at 15.3 times projected earnings, up from a multiple of 13.1 at the beginning of this year and holding close to a three-year high reached last week. The five- year average for the index is 13.9 times, data compiled by Bloomberg showed.

“The market is at least fairly valued,” said Ivo Weinoehrl, who helps oversee 946 billion euros ($1.27 trillion) as a fund manager at Deutsche Asset & Wealth Management in Frankfurt. “You’ve seen a huge multiple expansion in the S&P over the past two years. I don’t see much upside left from a purely fundamental point of view.”

Better-than-estimated corporate earnings have helped equities rally this year. Of the 447 companies in the S&P 500 to have reported quarterly results this period, 72 percent have exceeded analysts’ profit estimates and 56 percent have beaten sales projections, data compiled by Bloomberg show.

The Chicago Board Options Exchange Volatility Index, or VIX, advanced 5.3 percent to 13.41, extending its weekly rise to 12 percent. The equity volatility gauge reached its 2013 peak in June and has since dropped 35 percent.

Equity investors are piling into securities that hedge losses as a way to protect gains after the S&P 500 surged this year. While volatility has evaporated in the past month amid economic data showing stronger U.S. growth, shares outstanding of the iPath S&P 500 VIX Short-Term Futures ETN, a security designed to rise when stock fluctuations increase, have tripled this year.

Nine out of 10 main industries in the S&P 500 fell. Phone stocks retreated for a fifth straight day, losing 1 percent to extend a weekly loss to 2.5 percent. AT&T Inc. slid 1.4 percent to $34.80.

Gap Inc. dropped 3.1 percent to $44.10. The clothing retailer said July same-store sales rose 1 percent, less than the 1.6 percent estimated by analysts, on declines at its Old Navy and Banana Republic chains.

J.C. Penney declined 5.8 percent to $12.87, the eighth retreat in the past nine sessions. The feud between Ackman and board members began yesterday when the investor publicly released a letter calling for a speedier process to replace Chief Executive Officer Mike Ullman. Chairman Tom Engibous said the CEO “has the overwhelming support” of the board.

Apple Inc. fell for a fourth day, losing 1.4 percent to $454.45. The iPhone maker’s share of China’s smartphone market was cut by almost half in the second quarter as consumers opted for lower-priced handsets from domestic suppliers.

Apple shipments in China fell to 5 percent of the total in the second quarter from 9 percent a year earlier, Nicole Peng, the China research director for Canalys, said in phone interview today.

Juniper Networks Inc. retreated 5.6 percent, the most in more than three months, to $20.92. The No. 2 maker of networking equipment disclosed that it’s being investigated for possible violations of the U.S. Foreign Corrupt Practices Act.

Producers of raw materials rose 0.6 percent as a group, the only industry to advance out of 10 in the S&P 500. All six of the main industrial metals on the London Metal Exchange rose, following the data from China, the biggest commodities consumer.

Cliffs Natural Resources, a diversified miner, rallied 11 percent to $24.35 for the biggest advance in the S&P 500. Alcoa Inc., the largest U.S. aluminum producer, advanced 3.9 percent to $8.22, the steepest rise in the Dow. Freeport-McMoRan Copper & Gold Inc. climbed 2.6 percent to $31.61, its fourth straight gain.

Coal stocks also climbed, extending gains on the factory data from China after Moody’s yesterday raised the industry’s outlook to stable from negative. Peabody Energy Corp., the largest U.S. producer, jumped 7.8 percent to $17.90.

BlackBerry Ltd. rose 5.7 percent to $9.76, the highest in almost six weeks. Reuters reported the smartphone maker’s board may seek a buyer to take it private, citing unidentified people familiar with the talks. The company hasn’t started a formal sale process, according to the report.

Priceline.com Inc. jumped 3.9 percent to $969.89, the highest level since April 1999. The online-travel agent said second-quarter sales exceeded analysts’ estimates.

 

Have a wonderful weekend everyone.

 

Be magnificent!

 

The only way to achieve consciousness

is by concentrating on the physical, the mental, and the spiritual.

Concentration on the powers of the spirit to discover unity

in diversity is called consciousness.

All that draws on unity is moral; all that draws on diversity is immoral.

Swami Vivekananda, 1863-1902

As ever,

 

Carolann

 

The most valuable possession you can own is an open heart.

The most powerful weapon you can be is an instrument of

peace.

-Carlos Santana, 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:

On this day in 1876, Thomas Edison patented the mimeograph, a  precursor to the photocopier. This low cost printing press revolutionized the independent publishing industry.

August 8^th:  When we were visiting a garden this past May in the English countryside, the gardener told us the 8-8-8 rule:  In order to keep beautiful lavender, one must cut in down to 8 inches on August 8^th.

–from A Countrywoman’s Notes, August:

The local flower show was great fun, with lovely dahlias, long carrots, solid cabbages, pansies with delightful faces as well as large, mop-headed chrysanthemums.  The flower arrangements showed plenty of imagination and, I thought, so did the people who had compiled the competitions, for without creative classes there will not be good entries.  There proved to be much scope in the class entitled ‘A nursery rhyme’ when Little Boy Blue and the Old Lady who lived in a Shoe appeared in well-chosen floral form.  While the tug-of-war was going on and the rain threatened we watched small children on fat ponies negotiating painted fences.  But the best value for me, a chance visitor, was undoubtedly the dog show.  The majority were family pets but I spotted a few who had been taught ring behavior.  When under the scrutiny of the judge they held their pose like Hollywood children awaiting the photographer.  Those without  this discipline demonstrated their fondness for the family when the saw them at the ringside.  It was the diverse range of shapes and sizes that gave me such pleasure and must surely have presented the judge with a serious problem.  The smallest was an obviously highly intelligent border terrier, a good ratter, I was sure.  There was a mystery black dog which looked like a soft black shawl, so well draped that no one could really see what its feet were doing.  The lurchers were graceful and the Dobermans well groomed and fit, but it was the Pyrenean mountain dog that I would like to have been given.  I had a chat with its owner who explained how these Blaireau dogs act as guards for sheep in the mountains.  Perhaps in his native country Ben would have taken on  a fiercer attitude but here on show he was deceptively gentle. –Rosemary Verey.

I’ve failed over and over and over again in my life and that is why I succeed. –Michael Jordan.

Photos of the Day –August 8th, 2013

Chinese inventor Tao Xiangli (behind the robot) controls his self-made humanoid robot at his house located in a old residential area in Beijing, China. The self-taught Chinese inventor built the home-made robot, named ‘The King of Innovation,’ out of scrap metal and electronic wires that he bought from a second-hand market. Kim Kyung-Hoon/Reuters

A US Air Force Wideband Global SATCOM (WGS-6) mission lifts off on a ULA Delta IV rocket from Cape Canaveral Air Force Station, Fla., Wednesday night. The unmanned rocket is carrying a communications satellite for the US military and its partners. Mike Brown/Reuters

Market Closes for August 8^th, 2013

Market  Index	Close	Change
Dow  Jones	15498.32	+27.65    +0.18%
S&P 500	1697.48	+6.57    +0.39%
NASDAQ	3669.124	+15.116    +0.41%
TSX	12552.92	+140.19
		+1.13%

International Markets

Market  Index	Close	Change
NIKKEI	13605.56	-219.38
		-1.59%
HANG  SENG	21655.88	+67.04
		+0.31%
SENSEX	18789.34	+124.46
		+0.67%
FTSE 100	6529.68	+18.47
		+0.28%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	2.498	2.502
CND.   30 Year Bond	3.003	3.013
U.S.   10 Year Bond	2.5892	2.5986
U.S.   30 Year Bond	3.6729	3.6854

Currencies

BOC Close	Today	Previous
Canadian $	0.96826	0.95960
US   $	1.03279	1.04211
Euro Rate  1 Euro=		Inverse
Canadian   $	1.38200	0.72359
US  $	1.33813	0.74731

Commodities

Gold	Close	Previous
London Gold   Fix	1312.00	1285.74
Oil	Close	Previous
WTI Crude Future	103.40	104.37
BRENT	109.359	109.359

Market Commentary:

Canada

By Eric Lam

Aug. 8 (Bloomberg) — Canadian stocks rose the most in a month as exports rebounded in Germany and China, gold rallied and earnings from companies including Canadian Tire Corp. and Tim Hortons Inc. topped analyst estimates.

Canadian Tire soared to a record high and Tim Hortons, the nation’s largest coffee and doughnut chain, gained 0.7 percent.

Turquoise Hill Resources Ltd. jumped 12 percent after parent Rio Tinto Plc loaned $600 million to the company to fund development of its copper and gold mine in Mongolia. Air Canada rallied for a second day after reporting better-than-forecast profits.

The Standard & Poor’s/TSX Composite Index rose 140.19 points, or 1.1 percent, to 12,552.92 at 4 p.m. in Toronto, the biggest increase since July 11. The index has gained 1 percent this year.

“The reasons for the past few down days have been pretty tenuous,” said David Cockfield, a fund manager with Northland Wealth Management in Toronto. The firm manages about C$200 million ($193 million). “The numbers out there aren’t bad at all. This is a long, drawn out recovery but we’re still on the recovery path and I don’t see any reason why this market won’t continue to chug along. I’d like to see the Canadian market shake itself out of its doldrums.”

Chinese shipments overseas climbed 5.1 percent in July from a year earlier after sliding 3.1 percent in June, the General Administration of Customs in Beijing said. China is Canada’s second-largest trading partner. German exports increased 0.6 percent in June from May.

Raw-materials producers climbed the most in the S&P/TSX, gaining 5.9 percent, the most since 2011, as eight of 10 industries advanced. Trading volume was 62 percent higher compared with the 30-day average at this time of the day.

Turquoise Hill jumped 12 percent to C$5.10. Rio Tinto agreed to provide the $600 million loan after Turquoise Hill repaid an earlier $225 million bridge loan, the company said in a statement. The latest loan will mature in December.

Iamgold Corp. surged 14 percent to C$5.13 after announcing an agreement yesterday with the government of Suriname to reduce power rates at its Rosebel mine and lower costs by as much as $50 an ounce.

Barrick Gold Corp. climbed 8.2 percent to C$17.58 and Yamana Gold Inc. advanced 7.7 percent to C$10.03 as the price of gold jumped 1.9 percent to $1,309.90 an ounce in New York, the biggest gain in two weeks.

Teck Resources Ltd. jumped 7.7 percent to C$26.31 and First Quantum Resources Ltd. rallied 8.4 percent to C$17.12 after copper soared to an eight-week high as imports rose to the highest in 14 months in China.

Canadian Tire surged 7.1 percent to C$89.45, a record high.

The retailer reported second-quarter earnings of C$1.91 a share, compared with analysts’ estimates for C$1.77 a share. Canadian Tire is seeking a partner for its C$4.4 billion credit-card portfolio.

Tim Hortons, the nation’s largest coffee-and-doughnut chain, rose 0.7 percent to C$59.90 after the company posted a 14 percent increase in net income. Tim Hortons also announced it will buy back as much as 10 percent of its shares.

Air Canada, the nation’s largest airline, jumped 9.4 percent to C$2.90. The stock has gained 37 percent in the past two days, after reporting second-quarter profit that topped analysts’ estimates as fuel costs dropped.

US

By Nick Taborek

Aug. 8 (Bloomberg) — U.S. stocks rose, with the Standard & Poor’s 500 Index halting a three-day drop, as Chinese trade data topped estimates and jobless claims fell to the lowest monthly rate since before the recession.

Cliffs Natural Resources Inc. and Newmont Mining Corp. gained at least 8.7 percent as metals prices rallied. Tesla Motors Inc. surged 14 percent after reporting second-quarter results that surpassed analysts’ estimates. AT&T Inc. slid 0.8 percent as phone stocks fell the most in the benchmark index.

JPMorgan Chase & Co. dropped 0.9 percent after saying it’s under federal criminal investigation for practices tied to sales of mortgage-backed bonds.

The S&P 500 climbed 0.4 percent to 1,697.48 at 4 p.m. in New York, paring the index’s weekly drop to 0.7 percent. The Dow Jones Industrial Average gained 27.65 points, or 0.2 percent, to 15,498.32. About 5.9 billion shares changed hands on U.S. exchanges, 6.9 percent below the three-month average.

“It shows that the data is moving in the right direction, so at the end of the day that is a positive catalyst for stocks,” Anastasia Amoroso, Global Market Strategist at JPMorgan Funds, which oversees about $400 billion, said in a phone interview. “There could be some short-term volatility around how that impacts Fed policy. One thing to keep in mind is if the Fed does actually reduce the pace of purchases, that is for some very good reasons.”

The S&P 500 declined 1.1 percent the first three days of the week amid growing speculation the Federal Reserve will pare bond purchases this year as the economy strengthens. Fed Bank of Cleveland President Sandra Pianalto said yesterday there had been “meaningful improvement” in the labor market and a scaling back of stimulus may be warranted if it continues.

Fed Bank of Dallas President Richard Fisher told Germany’s Handelsblatt newspaper in an interview today that the central bank should start reducing bond purchases in September if “economic data doesn’t significantly deteriorate.” Fisher, one of the most vocal critics of quantitative easing, said on Aug. 5 the Fed is closer to slowing its stimulus.

Data today showed claims for U.S. unemployment benefits in the four weeks ended Aug. 3 declined to 335,500 on average, the least since November 2007. They rose to 333,000 last week, in line with the median forecast of 50 economists surveyed by Bloomberg, from 328,000 the prior week.

A separate report showed consumers last week were the most upbeat in more than five years. The Bloomberg Consumer Comfort Index rose to minus 23.5 for the period ended Aug. 4, its strongest reading since January 2008.

In Asia, data indicated China’s exports and imports exceeded economists’ forecasts, adding to signs that the world’s second-largest economy is stabilizing following a two-quarter slowdown. Improved trade may bolster Premier Li Keqiang’s chances of achieving the year’s 7.5 percent target for expansion, after official manufacturing and service-industry indexes rose in July.

The trade data “could be a sign that we see some stabilization in Chinese activity,” said Patrick Moonen, who helps oversee $244 billion as senior strategist at ING Investment Management in The Hague. “I don’t think the U.S. equity market is only a matter of monetary policy. As the economy recovers, the earnings backdrop will become the most important element.”

The S&P 500 has rallied 19 percent this year and closed at a record 1,709.67 on Aug. 2. The gauge topped 1,700 for the first time on Aug. 1, after climbing within two points of that level for three times in the week before only to retreat by the close of trading. It briefly rose above 1,700 twice today before slipping back below.

Stocks have also advanced this year as corporate earnings have surpassed estimates. Of the 445 companies in the S&P 500 to have reported quarterly results this period, 72 percent have exceeded analysts’ profit estimates and 56 percent have beaten sales projections, data compiled by Bloomberg show.

The Chicago Board Options Exchange Volatility Index, or VIX, fell 1.9 percent today to 12.73. The equity volatility gauge reached its 2013 peak in June and has since dropped 38 percent.

Nine of 10 industries in the the benchmark gauge advanced.

Materials stocks rallied 1.5 percent to pace gains, boosted by the data from China, which is the largest consumer of raw- materials.

Cliffs Natural Resources, a diversified miner, jumped 8.9 percent to $22.01. Newmont Mining rallied 8.7 percent to $28.78, snapping a six-day losing streak, as copper rose to an eight- week high and gold added the most in two weeks.

Tesla, the electric-car company led by Elon Musk, soared 14 percent to a record $153.48. The carmaker’s results surpassed analysts’ estimates on a surge in Model S sedan deliveries. The company also said it will make money all year on an operating basis, even as it expands to Europe and Asia.

Groupon Inc. rallied 22 percent to $10.60, the biggest jump since December. The operator of the largest daily-deals website’s second-quarter net loss was narrower than analysts forecast. The company also named co-founder Eric Lefkofsky as CEO to lead turnaround plans.

Consumer discretionary shares climbed 0.7 percent as a group. L Brands Inc., which operates Victoria’s Secret, gained 5.2 percent to $60.25 after reporting same-store sales in July rose more than analysts estimated.

J.C. Penney Co. jumped 6.7 percent to $13.66. The department-store chain seeking to rebound from its worst sales year in more than two decades gained for the first time since July 29 after CNBC said the retailer is searching for a new chief executive officer. The stock had lost 23 percent in the seven sessions through yesterday.

Microsoft Corp. rose 2.6 percent to $32.89 for the biggest gain in the Dow. The maker of the Windows operating system was raised to overweight from equalweight by Evercore Partners.

Analyst Kirk Materne said in a note the company has an attractive valuation and may increase its dividend in September.

Phone stocks tumbled 1 percent to pace declines in the S&P 500. AT&T dropped 0.8 percent to $35.29 and Verizon Communications Inc. lost 0.6 percent to $49.62.

CenturyLink Inc. fell 5.6 percent to $34.36 for the biggest drop in the S&P 500. The telecommunications company cut its sales forecast, citing slower acceleration in data-hosting revenue and a faster rate of decline in low bandwidth data services.

JPMorgan Chase declined 0.9 percent to $54.83 for the biggest slide in the Dow and a fifth straight losing session.

The biggest U.S. bank said the Justice Department’s civil division found in May that the bond-sales practices broke civil laws after it examined securities tied to subprime and Alt-A loans sold to investors from 2005 through 2007.

 

Have a wonderful evening everyone.

 

Be magnificent!

 

What is the object of jnâna yoga?  Freedom.

Freedom from what?  Freedom from our imperfections, freedom from the suffering of life.

Why are we unhappy?  We are unhappy because we are enslaved.  And what are we enslaved by?

The enslavement of nature.  Who enslaves us?

We do, ourselves.

Swami Vivekananda, 1863-1902

As ever,

 

Carolann

Nothing is a waste of time if you use the

experience wisely.

-Auguste Rodin, 1840-1917

 

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 today in the most recent edition of Barron’s:

The August Effect

In August 1913, exactly 100 years ago, General Motors’ stock surged nearly 20% for the month.  Folks were loving Buicks – and besides, it was August.  Stocks generally rose in August in those days, and that remained the case through the early ‘60s.  From 1913 to 1963, gains for the month averaged a strong 2%, says the Bespoke Investment Group.

Then something happened.  For the next 50 years, stocks were flat in August, and eventually they tended to decline.  For the past 20 years, Bespoke says, the Dow averaged a loss of 0.7% for August, the third-worst showing of any month.

We chalk it up to the changing nature of summer vacations.  In the old days, investors took their ease for weeks, sometimes months, at a time, opening their minds to truly fresh ideas as they boarded steamships to Europe or kicked back on the yacht-club porch.  A GM buy order was just a telegram away.

By the ‘50s, vacationers were packing up their Country Squire station wagons and crowding the nascent highway system, all thoughts of investing pushed aside by the loud demands of children and the harrowing antics of fellow drivers.  Stocks went nowhere.

Now, of course, no one really ever gets away, tethered to the market by the Internet.  Frazzled, anxious, and easily unnerved, legions of investors have turned their cellphones into sellphones.  Maybe this August it’s time to take a cue from our forebears and genuinely unplug.  It could do wonders for the market.  –Lawrence C. Strauss

Excellence is not a skill.  It is an attitude.  –Ralph Marston.

Photos of the Day –August 7th, 2013

A girl plays the piano in the park in Russia’s Siberian city of Krasnoyarsk. A group of young enthusiasts bought an old Soviet-made piano, adjusted it, painted it white and placed it in a park for free use by all visitors. Ilya Naymushin/Reuters

A child cools off from hot weather in a fountain at People’s Square in Shanghai, China. A record-setting summer heat wave continues to bake most parts of south China. Aly Song/Reuters

Market Closes for August 7^th, 2013

Market  Index	Close	Change
Dow  Jones	15470.67	-48.07    -0.31%
S&P 500	1690.91	-6.46    -0.38%
NASDAQ	3654.009	-11.761    -0.32%
TSX	12412.73	-56.59
		-0.45%

International Markets

Market  Index	Close	Change
NIKKEI	13824.94	-576.12
		-4.00%
HANG  SENG	21588.84	-334.86
		-1.53%
SENSEX	18664.88	-68.16
		-0.36%
FTSE 100	6511.21	-93.00
		-1.41%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	2.502	2.512
CND.   30 Year Bond	3.013	3.028
U.S.   10 Year Bond	2.5986	2.6402
U.S.   30 Year Bond	3.6854	3.7261

Currencies

BOC Close	Today	Previous
Canadian $	0.95960	0.96371
US   $	1.04211	1.03765
Euro Rate  1 Euro=		Inverse
Canadian   $	1.39033	0.71925
US  $	1.33416	0.74954

Commodities

Gold	Close	Previous
London Gold   Fix	1285.74	1283.65
Oil	Close	Previous
WTI Crude Future	104.37	105.30
BRENT	109.359	109.359

Market Commentary:

Canada

By Eric Lam

Aug. 7 (Bloomberg) — Canadian stocks fell, erasing gains for the year, as financials and energy producers retreated amid weaker-than-forecast housing construction and growing concern the U.S. Federal Reserve may reduce its bond purchases.

Dream Unlimited Corp., a real-estate manager and developer, lost 2.8 percent to pace declines among financial stocks.

Enbridge Inc. and Encana Corp. dropped at least 1.6 percent as energy shares slumped. BlackBerry Ltd. retreated 3.3 percent as its market share fell. Athabasca Oil Corp. surged 10 percent after winning approval for its Dover oil-sands project from an Alberta regulator. Air Canada soared 25 percent as profits topped estimates amid falling fuel costs.

The Standard & Poor’s/TSX Composite Index fell 56.59 points, or 0.5 percent, to 12,412.73 at 4 p.m. in Toronto. The benchmark Canadian equity gauge lost 1.5 percent over the past two days, and is down 0.2 percent for the year.

“I thought we needed a rest, a slight pause and a correction,” said Ian Nakamoto, director of research with MacDougall MacDougall & MacTier Inc. in Toronto. The firm manages about $4 billion. “If you go up in a straight line you’re in trouble. There’s some worry over the Fed which has caused the market to sell off, and that nervousness has spilled over into today.”

Canadian equities sank 1.1 percent yesterday as comments from a Fed official fueled concern the U.S. central bank may reduce the pace of its monthly bond buying this year. Fed Bank of Chicago President Charles Evans said he “would clearly not” rule out a decision to begin curbing bond purchases in September. Fed Bank of Cleveland President Sandra Pianalto said today that a tapering may be warranted if the labor market continues to strengthen.

Canadian building permits fell for the first time this year in June, declining 10.3 percent to C$6.65 billion ($6.38 billion) as contractors scaled back intentions for new condominiums. Economists surveyed by Bloomberg had forecast a median drop of 2.8 percent.

Dream Unlimited slumped 2.8 percent to C$12.10 as financial stocks dropped 0.6 percent.

Energy stocks declined 0.9 percent, falling the most as seven of 10 industries in the S&P/TSX retreated. Trading volume was 9.1 percent lower than the 30-day average.

Enbridge lost 1.6 percent to C$44.88 and Encana decreased 1.9 percent to C$18.07 as 42 of 58 members in the S&P/TSX Energy Index fell.

Crude for September delivery dropped 0.9 percent to settle at $104.37 a barrel in New York, after the U.S. government reported an unexpected increase in supplies of gasoline and distillate fuels. Economists had forecast stockpiles to decrease.

BlackBerry lost 3.3 percent to C$9.58, snapping five days of gains. BlackBerry’s global smartphone market share in the second quarter fell to 2.9 percent from 4.9 percent a year ago, a report from International Data Corp. said today. Google Inc.’s Android operating system was the top performer, climbing to a 79 percent market share, the report said.

Athabasca Oil jumped 10 percent to C$8.12. With the Alberta regulator approving the Dover oil-sands project, Athabasca can sell its stake in the project, worth about C$1.3 billion, to PetroChina Co. and use the funds for other projects.

Air Canada climbed 25 percent to C$2.65, the most since May 2009, after reporting second-quarter profit that topped analysts’ estimates. The company said it spent C$831 million on fuel in the second quarter, 6 percent less than the same period a year ago. Capacity will grow 9 percent to 11 percent next year as the company adds Boeing Co. 777 and 787 jets.

Valeant Pharmaceuticals International Inc. rose 2.1 percent to C$101.70, a record high, after raising its full-year earnings forecast. The drugmaker completed its $8.7 billion acquisition of Bausch & Lomb Inc. this month and expects “significantly more than” $800 million in cost synergies from the combined company.

US

By Nick Taborek and Tom Stoukas

Aug. 7 (Bloomberg) — U.S. stocks declined, giving the Standard & Poor’s 500 Index its first three-day drop since June 12, amid growing speculation the Federal Reserve will pare bond purchases this year as the economy strengthens.

Bank of America Corp. declined 0.8 percent after the Department of Justice yesterday accused the company in a lawsuit of misleading investors. Walt Disney Co. dropped 1.7 percent after quarterly profit stalled on lower earnings from films and weaker revenue at its ABC network. Time Warner Inc. fell 0.4 percent, erasing an earlier gain after an analyst downgraded the shares.

The S&P 500 slid 0.4 percent to 1,690.91 at 4 p.m. in New York. The benchmark gauge has fallen 1.1 percent this week after closing at a record on Aug. 2. The Dow Jones Industrial Average decreased 48.07 points, or 0.3 percent, to 15,470.67 today.

About 5.5 billion shares changed hands on U.S. exchanges, 12 percent below the three-month average.

“We’re just going through a period of consolidation,” Terry Sandven, chief equity strategist at U.S. Bank Wealth Management in Minneapolis, said by phone. His firm manages $112 billion. “We still like the outlook for the broad equity market, but near term we’re probably in a trading range pattern until we get greater clarity as to what happens with quantitative easing.”

The S&P 500 sank the most in six weeks yesterday as trade data and comments from a Fed official fueled concern the central bank may reduce stimulus this year. Fed Bank of Chicago President Charles Evans said he would not rule out a decision to begin tapering in September.

Fed Bank of Cleveland President Sandra Pianalto said today there has been “meaningful improvement” in the labor market and that tapering may be warranted if it continues to strengthen.

Fed policy makers are weighing data to determine whether the economy has improved enough to begin reducing its $85 billion in monthly bond purchases. The stimulus has helped propel the S&P 500 up more than 150 percent from its bear-market low in 2009.

A report Aug. 2 showed American companies added fewer workers than anticipated in July while the jobless rate fell to 7.4 percent. Separate data last week showed U.S. gross domestic product rose at a better-than-forecast rate and manufacturing expanded in July.

“The economic data is probably coming in a little better than expected, and because of that I think the market’s concerned that’s going to give the Fed the potential to begin tapering in September,” Mike Binger, who helps oversee about $360 million as senior portfolio manager at Gradient Investments LLC in Shoreview, Minnesota, said by phone.

Stocks also climbed to records amid better-than-estimated corporate earnings. Of the 436 companies in the gauge that have reported results for the second quarter, 72 percent have exceeded analysts’ profit estimates and 56 percent have beaten sales projections, data compiled by Bloomberg show.

The equity index has advanced 19 percent this year and is trading at 15.3 times estimated earnings, compared with an average of 13.9 over the last five years, data compiled by Bloomberg showed.

The Chicago Board Options Exchange Volatility Index, or VIX, rose 2 percent today to 12.98 for a second day of gains.

The equity volatility gauge reached its 2013 peak in June and has since fallen 37 percent.

Seven of 10 main industry groups in the S&P 500 fell today.

Shares in consumer discretionary and financial companies slid 0.8 percent for the biggest declines.

Bank of America slid 0.8 percent to $14.53, paring an earlier loss of as much as 2.7 percent. The Justice Department said the firm misled investors about the quality of loans tied to $850 million in mortgage-backed securities. The complaint chronicles friction among bank staff in 2007 and 2008 as they excluded risky Alt-A loans while leaving in wholesale debts once scorned as “toxic waste” by the firm’s then-chief.

Disney fell 1.7 percent to $65.91 for the steepest decline in the Dow. The world’s biggest entertainment company said third-quarter profit was little changed from the same time last year amid costs to market the box-office disappointment “The Lone Ranger” and shrinking revenue at ABC television network.

A gauge that tracks homebuilder shares retreated for a third day, falling 2.7 percent to the lowest level since November. All 11 members of the S&P Supercomposite Homebuilders Index declined, extending the measure’s loss this week to 7.1 percent. D.R. Horton Inc. slid 3.2 percent to $18.98 and Toll Brothers Inc. lost 3 percent to $31.23.

Ralph Lauren Corp. fell 8.6 percent to $173.13. The retailer of its namesake brand clothing issued a forecast for the current quarter that implied profit would trail analysts’ estimates.

Clothing retailers slid yesterday after a Janney Montgomery analyst downgraded the sector, citing headwinds including a high level of promotional activity. The group retreated 1.3 percent today.

First Solar Inc. tumbled 13 percent to $40.47 for the biggest loss in the S&P 500. The largest U.S. solar-panel manufacturer said yesterday profit fell short of analysts’ estimates as revenue from its current project pipeline slumped.

Today’s share-price drop was the steepest in five months.

Zillow Inc. tumbled 7.7 percent to $83.73. The operator of the largest U.S. real-estate information website reported a second-quarter loss on higher costs related to advertising and acquisition-related compensation.

The Dow Jones Transportation Average fell for a fourth day, sliding 0.7 percent, as C.H. Robinson Worldwide Inc. lost 5.5 percent to $56.31. The cargo and logistics company was downgraded to underperform from market perform by a Wells Fargo analyst after it reported yesterday sales that missed estimates.

Computer Sciences Corp. jumped 8.5 percent to $54.20 for the biggest gain in the S&P 500. The technology consultant for governments and companies forecast earnings that were higher than analysts estimated as the company cut costs and struck partnerships.

Time Warner fell 0.4 percent to $64.49. The owner of the TNT, CNN and HBO cable channels fell after a B. Riley analyst downgraded the shares to neutral from buy. The company had gained as much as 3 percent earlier in the day after reporting second-quarter profit that topped analysts’ estimates. Network advertising sales rose 11 percent, helped by the National Basketball Association playoffs on TNT and the college basketball tournament.

AOL Inc. rose 1.4 percent to $36.69 after it agreed to buy Adap.tv for about $405 million, gaining online video advertising technology used by the world’s largest brands and agencies. The purchase is the largest by AOL since Chief Executive Officer Tim Armstrong led the spinoff of the company from Time Warner in 2009.

21st Century Fox Inc.’s Class A shares advanced 1.9 percent to $31.81. Rupert Murdoch’s film and television company that in June spun off News Corp.’s publishing operation today posted a gain in fourth-quarter operating profit, bolstered by growth at cable networks including F/X and Fox News.

 

Have a wonderful evening everyone.

 

Be magnificent!

 

What we are about to undertake is an expedition together, a journey of discovery

into the most secret recesses of our consciousness.

And for such an adventure we must travel light, we cannot burden ourselves

with opinions, prejudices, conclusions that is, with all the baggage that we have collected

over the past two thousand years or more.  Forget everything you know about yourself;

forget everything that you have thought about yourself;

we are going to set off as if we know nothing.

Krishnamurti, 1895-1986

As ever,

 

Carolann

 

Be kind whenever possible.  It is always

possible.

-Dalai Lama, 1935-

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:

Hiroshima Day: the world’s first nuclear weapon used in warfare occurred on this day in 1945.

There is a goddess of Memory, Mnemosyne, but none of Forgetting.  Yet there should be, as they are twin sisters, twin powers and walk on either side of us, disputing for sovereignty over us and who we are, all the way until death.

–Richard Holmes, A meander Through Memory and Forgetting.

Photos of the Day –August 6th, 2013

The Atomic Bomb Dome is silhouetted at sunset in Hiroshima, western Japan. Hiroshima marks the 68th anniversary of the world’s first atomic bombing. Shizuo Kambayashi/AP

Market Closes for August 6^th, 2013

Market  Index	Close	Change
Dow  Jones	15518.74	-93.39    -0.60%
S&P 500	1697.37	-9.77    -0.57%
NASDAQ	3665.770	-27.182    -0.74%
TSX	12469.32	-133.93
		-1.06%

International Markets

Market  Index	Close	Change
NIKKEI	14401.06	+143.02
		+1.00%
HANG  SENG	21923.70	-298.31
		-1.34%
SENSEX	18733.04	-449.22
		-2.34%
FTSE 100	6604.21	-15.37
		-0.23%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	2.512	2.490
CND.   30 Year Bond	3.028	3.001
U.S.   10 Year Bond	2.6402	2.5979
U.S.   30 Year Bond	3.7261	3.6843

Currencies

BOC Close	Today	Previous
Canadian $	0.96371	0.96226
US   $	1.03765	1.03922
Euro Rate  1 Euro=		Inverse
Canadian   $	1.38072	0.72426
US  $	1.33062	0.75153

Commodities

Gold	Close	Previous
London Gold   Fix	1283.65	1312.80
Oil	Close	Previous
WTI Crude Future	105.30	106.94
BRENT	109.359	109.359

Market Commentary:

Canada

By Eric Lam

Aug. 6 (Bloomberg) — Canadian stocks fell for the first time in three days, led lower by precious metals producers and energy companies as commodities extended declines.

Barrick Gold Corp. and Yamana Gold Inc. retreated at least 6.2 percent as the precious metal headed for a sixth straight decline, the longest slump since May. Athabasca Oil Corp. and Suncor Energy Inc. slid at least 1.3 percent as oil prices fell for a third day. Paladin Energy Ltd. sank 6.9 percent to extend losses a second day after the uranium producer agreed to sell additional shares at a discount. BlackBerry Ltd. surged 5.7 percent for a fifth day of gains.

The Standard & Poor’s/TSX Composite Index fell 149.47 points, or 1.2 percent, to 12,453.78 at 2:12 p.m. in Toronto.

Today’s drop trimmed the gauge’s gain for the year to 0.2 percent. Trading volume was 7.1 percent lower than the 30-day average at this time of the day. Canadian markets were closed yesterday for a holiday.

“The commodities are weak and it affects us more than the U.S. market,” said John Kinsey, fund manager with Caldwell Securities Ltd. in Toronto. The firm manages about $1 billion.

“Gold looked like it was starting to form a bottom for a while there but now it’s breaking down. It’s been a big disappointment for an awful lot of people. The Fed really gave all the wrong signals and they’ve been trying to repair the damage ever since.”

Federal Reserve Chairman Ben S. Bernanke said last month that it’s too early to decide whether to begin paring asset purchases in September. The comments helped gold rise 7.3 percent in July, the biggest monthly gain since January 2012.

Speculation that the central bank would pull back on stimulus escalated yesterday after Fed Bank of Dallas President Richard Fisher, one of the most vocal critics of quantitative easing, said the Fed is closer to slowing the pace of bond buying. Fed Bank of Chicago President Charles Evans, who has been among the strongest proponents of record monetary accommodation, said today he “would clearly not rule” out a decision to begin dialing back the purchases in September.

Nine of 10 industries in the S&P/TSX retreated. Raw- materials producers lost the most, declining 3.4 percent to the lowest since June.

Barrick Gold, the world’s largest gold producer, tumbled 6.2 percent to C$16.29 and Yamana Gold plunged 6.4 percent to C$9.37, pacing declines in the S&P/TSX Gold Index. The gauge lost 5.4 percent, with 23 of its 24 members retreating. Gold futures for December delivery declined 1.5 percent in New York, on pace for the longest string of drops in 11 weeks.

Athabasca Oil slumped 3.4 percent to C$7.38 and Suncor Energy lost 1.3 percent to C$33.46. Crude for September delivery fell for a third day amid speculation the Fed will reduce stimulus, losing 1.4 percent in New York.

Francisco Blanch, head of commodities research with Bank of America, said in a Bloomberg Radio interview with Tom Keene West Texas Intermediate crude could slide $8 to $10 “unless there is a major geopolitical event” to drive prices higher.

Crude jumped 8.8 percent in July for the biggest monthly gain since August 2012, as U.S. inventories dropped and on concern political instability in Egypt would disrupt exports from the Middle East.

Paladin Energy sank 6.9 percent to 67 Canadian cents. The stock plunged 22 percent on Aug. 2 after the company said it failed to sell part of the Langer Heinrich mine in Namibia. That prompted the uranium miner to sell shares at a 30 percent discount to its previous closing price in Australia to raise about $78 million.

BlackBerry advanced 5.7 percent to C$9.80, giving information-technology stocks the only gain among 10 S&P/TSX groups. The smartphone maker’s shares have risen for five days, the longest streak since February.

U.S.-listed shares in the Waterloo, Ontario-based company jumped 7.4 percent yesterday after a report by GSM Arena included supposed leaked images of new BlackBerry smartphones that are in development.

US

By Nick Taborek and Whitney Kisling

Aug. 6 (Bloomberg) — U.S. stocks fell, giving the Standard & Poor’s 500 Index its biggest decline since June 24, as retailers’ results disappointed and trade data fueled concern the Federal Reserve may reduce its bond purchases this year.

American Eagle Outfitters Inc. and CVS Caremark Corp. slumped more than 2.8 percent. Newmont Mining Corp. lost 6.5 percent as gold tumbled. International Business Machines Corp. retreated 2.3 percent after requiring most U.S. employees in its hardware division to take a week off amid slowing demand.

Washington Post Co. rallied 4.3 percent as Amazon.com Inc. Chief Executive Officer Jeff Bezos agreed to buy its newspaper assets.

The S&P 500 fell 0.6 percent to 1,697.37 at 4 p.m. in New York, extending yesterday’s loss after a record high last week.

The Dow Jones Industrial Average decreased 93.39 points, or 0.6 percent, to 15,518.74. About 5.6 billion shares changed hands on U.S. exchanges, 12 percent below the three-month average.

“Certainly some of the move is due to increased concern about tapering due to the very strong trade number,” Paul Zemsky, the New York-based head of asset allocation for ING Investment Management which oversees $180 billion, said in an e- mail. “It’s puzzling to me why better GDP growth would be bad for the equity market, but there are some who view it this way. Longer term, we need to see revenue growth, and stronger GDP will deliver that.”

The U.S. trade deficit narrowed more than forecast in June to the lowest level since October 2009 as crude oil imports declined and American companies shipped more goods abroad, showing second-quarter growth was stronger than initially estimated.

Economists at Goldman Sachs Group Inc. and Barclays Plc raised their estimates for second-quarter U.S. gross domestic product, citing the trade report. A Commerce Department report last week showed the economy grew more than projected in the quarter, with GDP rising at a 1.7 percent annualized rate after a 1.1 percent gain the prior quarter.

The S&P 500 fell 0.1 percent yesterday after Fed Bank of Dallas President Richard Fisher, one of the most vocal critics of quantitative easing, said the central bank is closer to slowing its $85 billion in monthly bond buying.

Fed Bank of Chicago President Charles Evans, who has been among the strongest proponents of record monetary accommodation, said today he “would clearly not rule” out a decision to begin dialing back the purchases in September.

“We’ve seen good improvement in the labor market, there’s no question in my mind about that,” Evans said in a meeting with reporters in Chicago. “I’m still wanting to see greater evidence that it’s a sustainable improvement.”

Central bank policy makers have been debating the pace and timing of any cuts in the monetary stimulus that has helped propel the S&P 500 up more than 150 percent from its bear-market low in 2009. The Fed said last week that persistently low inflation could hamper the economy and pledged to keep buying bonds every month. Tapering of the pace of asset purchases may begin in September, according to a growing number of economists surveyed by Bloomberg from July 18 to July 22.

Stocks rallied 1.1 percent last week, sending the S&P 500 above 1,700 for the first time. The equity gauge has advanced 19 percent this year and is trading at 15.4 times estimated earnings, compared with an average of 13.9 over the last five years, data compiled by Bloomberg showed.

Better-than-expected corporate earnings have bolstered stocks in recent weeks. Some 31 companies in the S&P 500 report earnings today, including Marathon Oil Corp. and Walt Disney Co. Of the 419 members that have posted quarterly results so far, 73 percent have exceeded analysts’ estimates for profit, data compiled by Bloomberg show.

“The market is probably just sort of resting, digesting all its earnings numbers, which are good but not great,” Thomas Nyheim, a Wilmington, Delaware-based fund manager for Christiana Trust, which oversees about $16 billion, said by phone.

“Companies have basically hit their earnings numbers through cost cutting and not hiring as much as they should.”

Volumes on exchange-listed stocks reached 4.65 billion yesterday, the slowest full-day trading this year, data compiled by Bloomberg show. Intraday price swings have narrowed, with fluctuations in the S&P 500 averaging 0.65 percent during the past 20 days through yesterday, the smallest change over a comparable period since Feb. 1, the data show.

The Chicago Board Options Exchange Volatility Index, or VIX, jumped 7.4 percent today to 12.72. The equity volatility gauge reached its 2013 peak in June and has since fallen 38 percent.

All 10 main industry groups in the S&P 500 fell, with raw- materials, financial and industrial companies losing at least 0.8 percent to lead declines. Newmont Mining retreated 6.5 percent to $26.63 as gold prices declined 1.5 percent, capping the longest slump in 11 weeks. Caterpillar Inc. slid 1.2 percent to $82.53. Citigroup Inc. fell 2.6 percent to $51.48.

The Morgan Stanley Cyclical Index lost 1.4 percent and the Dow Jones Transportation Average erased 1.3 percent. An S&P index of homebuilders slipped 2.6 percent and the Bloomberg U.S.

Airlines Index dropped 2.7 percent. PulteGroup Inc. declined 4 percent to $16.19 and KB Home tumbled 3.5 percent to $16.79.

United Continental Holdings Inc. retreated 3.8 percent to $33.57 and Delta Air Lines Inc. fell 3.4 percent to $20.98.

Retailers slid. Urban Outfitters Inc. slipped 2.8 percent to $42.47 and Abercrombie & Fitch Co. erased 4.1 percent to $49.57 after a Janney Montgomery analyst downgraded the retail softline sector to underweight from neutral weight, citing headwinds including a high level of promotional activity.

American Eagle Outfitters fell 12 percent, the most since May 2010, to $17.57. The teen apparel chain said second-quarter profit was less than it forecast amid disappointing sales of women’s clothing and weak shopper traffic.

CVS Caremark dropped 2.8 percent to $59.89, the biggest decline since June 20. The largest provider of prescription drugs in the U.S. lowered the top end of its full-year adjusted earnings target to $3.96 a share from $4 a share.

J.C. Penney Co. declined 3.9 percent to $13.28, falling for a sixth straight session to the lowest level since January 2001.

The stock has tumbled 20 percent since July 29.

IBM lost 2.3 percent to $190.99 for the biggest drop in the Dow. The world’s largest computer-services company said U.S. employees in its hardware division will take a furlough week with one-third pay starting either Aug. 24 or Aug. 31.

The company is cutting costs after server demand slowed in the second quarter. Sales in the hardware business, which includes storage devices and microelectronics, slid 12 percent in the period from a year earlier to $3.76 billion.

Regeneron Pharmaceuticals Inc. fell 6.1 percent to $254.50.

The drug company declined after reporting second-quarter profit and sales that missed analysts’ estimates.

Washington Post Co. advanced 4.3 percent to $593. Bezos agreed to buy the Washington Post newspaper that is the core of the company’s weakest division. Washington Post Co., which isn’t selling its Kaplan education division and other businesses, plans to change its name.

Fossil Group Inc. gained 18 percent to $126.55. The fashion accessories designer reported results that beat analysts’ estimates. The company also raised its full-year earnings forecast. Fossil slid the most in the S&P 500 yesterday after a Barclays Plc analyst downgraded the shares to underweight from equalweight.

 

Have  a wonderful evening everyone.

 

Be magnificent!

 

Fear comes from the selfish idea

of cutting one’s self off from the universe.

Swami Vivekananda, 1863-1902

As ever,

 

Carolann

 

Success is not final, failure is not fatal: it is the courage

to continue that counts.

-Winston Churchill, 1874-1965

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:

What carries us through

We lie on the driveway, side by side,

old sheet pulled up

to our shoulders to fend off the mosquitoes,

and look

for shooting stars against the August sky.

(I see one – there!  Did you see it?)

Too hot to touch, I feel your hand,

hold a single finger,

love you,

bigger than the sky,

for taking me outside

to see.

-Jennifer Freed

Make a note: The Perseid meteor shower will peak the night of August 12^th.

Photos of the Day –August 2nd, 2013

Star trails form over yurts, traditional nomad felt tents, in a long exposure picture on the mountainous Assy plateau, 56 miles east of Almaty, Kazakhstan. Modern farmers follow centuries old nomadic tradition of relocating from settlements to the plateau to tend their livestock for a summer season. Shamil Zhumatov/Reuters

A general view of Hong Kong’s business district. The Hong Kong Observatory has issued a strong wind signal number three as Tropical Storm Jebi edges closer to Hong Kong. Vincent Yu/AP

Market Closes for August 2^nd, 2013

Market  Index	Close	Change
Dow  Jones	15658.36	+30.34    +0.19%
S&P 500	1709.67	+2.80    +0.16%
NASDAQ	3689.588	+13.844    +0.38%
TSX	12603.25	+9.29
		+0.07%

International Markets

Market  Index	Close	Change
NIKKEI	14466.16	+460.39
		+3.29%
HANG  SENG	22190.97	+102.18
		+0.46%
SENSEX	19164.02	-153.17
		-0.79%
FTSE 100	6647.87	-34.11
		-0.51%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	2.490	2.547
CND.   30 Year Bond	3.001	3.043
U.S.   10 Year Bond	2.5979	2.7060
U.S.   30 Year Bond	3.6843	3.7542

Currencies

BOC Close	Today	Previous
Canadian $	0.96226	0.96631
US   $	1.03922	1.03486
Euro Rate  1 Euro=		Inverse
Canadian   $	1.38028	0.72449
US  $	1.32819	0.75291

Commodities

Gold	Close	Previous
London Gold   Fix	1312.80	1305.18
Oil	Close	Previous
WTI Crude Future	106.94	107.89
BRENT	109.359	109.359

Market Commentary:

Canada

By Eric Lam

Aug. 2 (Bloomberg) — Canadian stocks rose a second day as banks helped lead gains, offsetting a drop in industrials after data showed the U.S. added fewer jobs than forecast in July.

Turquoise Hill Resources Ltd., a unit of Rio Tinto Group, jumped 8.7 percent for a third day of gains after agreeing to new terms for the sale of a stake in a mine. Royal Bank of Canada, the nation’s largest lender, climbed 0.8 percent.  SNC- Lavalin Group Inc., Canada’s largest engineering company, sank 6.1 percent after reporting an unexpected second-quarter loss.

Paladin Energy Ltd. plunged 22 percent after saying it will sell additional shares.

The Standard & Poor’s/TSX Composite Index rose 9.29 points, or 0.1 percent, to 12,603.25 at 4 p.m. in Toronto. The gauge pared a weekly loss to 0.4 percent. Trading volume was about 24 percent lower than the 30-day average.

“It’s time for a bit of a pause,” said Keith Richards, a fund manager with ValueTrend Wealth Management in Barrie, Ontario. The firm manages about C$110 million ($106 million). “We’ve had this great run in the U.S. markets.”

U.S. payrolls rose by 162,000 last month, less than an estimated 185,000 and the smallest advance in four months. The unemployment rate dropped to 7.4 percent from 7.6 percent. The U.S. Federal Reserve has indicated its $85 billion monthly bond buying may be trimmed should the economy meet its forecasts, though Chairman Ben S. Bernanke has said there’s no fixed schedule for reducing stimulus.

Turquoise Hill surged 8.7 percent to C$5 after agreeing to sell its 50 percent stake in Altynalmas Gold Ltd. to Sumeru Gold BV for $235 million, down from $300 million agreed to in February. In exchange, Turquoise Hill will receive advance payment by Aug. 9, ahead of the closing of the transaction.

Silvercorp Metals Inc. gained 2.6 percent to C$3.12 as silver rallied 1.5 percent to $19.912 an ounce in New York, snapping three days of losses.

Royal Bank rose 0.8 percent to C$64.43 and Toronto-Dominion Bank advanced 0.7 percent to C$87.37 as the S&P/TSX Financials Index rose the most in two weeks.

Paladin Energy Ltd. slumped 22 percent to 72 Canadian cents, the biggest loss since in went public in 2005. The Australian company producing uranium in Africa announced it will sell shares to institutions after ending talks to sell a stake in its mine in Namibia, citing low prices for the nuclear fuel.

Athabasca Oil Corp. lost 3.9 percent to C$7.64 and Pengrowth Energy Corp. slipped 1.7 percent to C$5.94. Oil dropped 0.9 percent to $106.94 a barrel, paring a weekly advance.

SNC-Lavalin, based in Montreal, tumbled 6.1 percent to C$40.38 after cutting its annual profit forecast. The company cited losses in the second quarter in its oil and gas division and its infrastructure and environment unit. Chief Executive Officer Robert Card said in the statement that 2013 is “proving to be a very challenging year.”

Bombardier Inc. lost 1.6 percent to C$4.87. The world’s third-biggest aircraft maker said it is working toward a debut takeoff for the CSeries jetliner within the next few weeks, after three delays since November.

US

By Lu Wang and Katie Brennan

Aug. 2 (Bloomberg) — U.S. stocks rose, with the Standard & Poor’s 500 Index erasing an earlier decline, as data showing employers added fewer workers than anticipated in July signaled the Federal Reserve will continue its stimulus efforts.

American International Group Inc. rallied 2.7 percent after saying it will pay its first dividend since 2008 and authorizing a share buyback of as much as $1 billion. LinkedIn Corp. surged 11 percent after increasing its full-year sales forecast. Dell Inc. advanced 5.6 percent as Michael Dell agreed to sweeten his proposal to buy the computer maker with a special dividend.

Chevron Corp. slipped 1.2 percent after posting its biggest second-quarter profit decline in four years.

The S&P 500 rose 0.2 percent to 1,709.67 at 4 p.m. in New York, advancing to a record in the final hour of trading and capping the weekly gain at 1.1 percent. The Dow Jones Industrial Average climbed 30.34 points, or 0.2 percent, to a record 15,658.36 today. About 5.7 billion shares changed hands, 11 percent lower than the three-month average.

“This number isn’t an earth-shaker,” John Manley, who helps oversee $222.7 billion as chief equity strategist for Wells Fargo Funds Management in New York, said in a phone interview. “It is debatable if it was good or bad. It was OK. The number still indicates the Fed is going to be there for a while, that is not bad.”

The 162,000 increase in payrolls last month was the smallest in four months and followed a revised 188,000 rise in June that was less than initially estimated, Labor Department figures showed today in Washington. The median forecast of 93 economists surveyed by Bloomberg called for a 185,000 gain.

Workers spent fewer hours on the job and hourly earnings fell for the first time since October. The unemployment rate dropped to 7.4 percent from 7.6 percent.

Consumer spending rose in line with forecasts in June as Americans’ incomes grew, while orders placed with factories increased, pointing to further stabilization in manufacturing that may help lift second-half growth, separate reports showed.

Equities pared earlier losses as Federal Reserve Bank of St. Louis President James Bullard, who backed this week’s Fed decision to continue bond buying, said the central bank should wait for evidence the labor market and economy are strengthening before tapering purchases.

The S&P 500 climbed above the 1,700 level yesterday for the first time as central banks vowed to maintain stimulus efforts and data on global manufacturing beat forecasts. The benchmark gauge is trading at 15.5 times projected earnings, compared with an average of 13.9 over the last five years, according to data compiled by Bloomberg.

About 83 percent of stocks in the index traded above their average prices from the past 50 days as of yesterday, according to data compiled by Bloomberg. While that’s below a 19-month high of 93 percent reached in May, it’s up from its 2013 bottom of 12.8 percent in June.

Some 115 S&P 500 stocks had their 14-day relative-strength index exceeding 70 yesterday, the most since May 21, Bloomberg data show. RSI measures the degree to which gains and losses outpace each other and some analysts who watch charts to predict market moves consider a reading over 70 as indicating the stock has risen too far too fast.

Three rounds of bond purchases by the Fed, coupled with improving earnings and economic growth, has helped propel the S&P 500 up more than 150 percent from its bear-market low in 2009. Speculation about the Fed’s monthly bond purchases has whipsawed stocks since May, when Chairman Ben S. Bernanke first indicated policy makers could begin reducing the stimulus this year if the job market continues to improve.

Fed officials said this week the labor market has shown “improvement,” while a report showed the U.S. economy grew more than projected in the second quarter. The central bank may begin tapering the pace of its asset purchases in September, according to a growing number of economists surveyed by Bloomberg from July 18 to July 22.

“The market will read today’s jobs report as part of the mixed data that’s shaping the Fed’s policy,” Stephen Wood, the New York-based chief market strategist who helps oversee about $237 billion at Russell Investments. “The pattern of economic growth looks more lumpy coming into this quarter. The market is going to turn its focus back to the earnings season and look at the revenue guidance with a microscope.”

Chevron and Berkshire Hathaway Inc. are among nine S&P 500 companies reporting results today. Of the 390 companies in the gauge to have already reported quarterly earnings, 74 percent have exceeded analysts’ profit estimates and 56 percent have beaten sales projections, data compiled by Bloomberg show.

The Chicago Board Options Exchange Volatility Index, or VIX, dropped 7.4 percent today to 11.98, the lowest closing level since March 15. The equity volatility gauge reached its 2013 peak in June and has since fallen 42 percent.

Seven of the 10 main industries in the S&P 500 advanced, with consumer-discretionary, raw-materials and technology companies rising at least 0.5 percent to lead gains.

AIG jumped 2.7 percent to $48.33. The insurer that repaid a government bailout last year announced a quarterly dividend of 10 cents a share. It also posted net income that climbed 17 percent to $2.73 billion in the second quarter.

LinkedIn surged 11 percent to $235.58. The operator of the biggest online professional-networking service said revenue jumped 59 percent to $363.7 million in the second quarter. That exceeded the average analyst estimate of $354.3 million.

Facebook Inc. rose 1.5 percent to $38.05, a closing price not seen since the social-networking company’s May 18, 2012, initial public offering. The stock had tumbled to a low of $17.55 in September, less than half the $38 IPO price.

Dell increased 5.6 percent to $13.68. Michael Dell and Silver Lake Management LLC agreed to increase their offer for the computer maker to $13.75 a share with a special dividend of 13 cents. Dell and Silver Lake had offered $13.65.

Sealed Air Corp. rallied 8.9 percent to $30.36 for the largest advance in the S&P 500. The packing-material maker reported second-quarter adjusted profit of 35 cents a share, beating the average analyst estimate of 25 cents.

Viacom Inc. jumped 6.5 percent to $79.17. The owner of cable networks MTV and Nickelodeon doubled its stock-buyback program to $20 billion and posted higher-than-estimated sales.

Charter Communications Inc. climbed 4.7 percent to $134.

The fourth-largest U.S. cable company by subscribers has held talks about combining with rival Cox Communications Inc., according to two people with knowledge of the matter.

Charter and its shareholder Liberty Media Corp. are still pursuing an acquisition of Time Warner Cable Inc., the people said. Time Warner Cable, which has been resistant to a combination with Charter, slipped 0.5 percent to $117.10.

Cablevision Systems Corp. climbed 5.2 percent to $19.61 even after the fifth-largest U.S. cable provider reported second-quarter sales that missed analysts’ estimates. The stock climbed 25 percent this year through yesterday, driven by speculation it may be an acquisition target.

Chief Executive Officer James Dolan said on the earnings call that “you never say never” to potential mergers and acquisitions.

Energy companies fell 0.6 percent as a group, the most in the S&P 500. Chevron slipped 1.2 percent to $124.95. The world’s second-largest energy company by market value missed analysts’ estimates as crude oil prices and production fell.

Eaton Corp. slid 5.5 percent to $66.06. The equipment maker cut the high end of its 2013 forecast, saying it expects to earn no more than $4.25 a share. Analysts estimated $4.33 on average.

CareFusion Corp. tumbled 6 percent, the most in the S&P 500, to $36.61. Smiths Group said talks with a “potential counterparty” to sell its medical equipment division had collapsed. The U.S. maker of medical pumps, ventilators and medicine dispensers was a potential buyer for the U.K. technology company’s unit, the Financial Times said in May.

 

Have a wonderful weekend everyone.

 

Be magnificent!

 

When a man begins to have a vision larger than his own truth,

when he realizes that it is much larger than it at first seemed, he begins to become conscious of his moral nature.

His perspective on life necessarily changes , and his will takes the place of his desires,

So comes about the conflict between our inferior self and our superior self,

between our desires and our will, between our greed for objects that appeal to our senses

and the purpose that comes from the bottom of our heart.

Rabindranath Tagore,1861-1901

As ever,

 

Carolann

 

Wear a smile and have friends; wear a scowl

and have wrinkles.

-George Eliot, 1819-1880

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:

On this day in…

1819, Herman Melville was born.

1831, King William IV and Queen Adelaide officiate at the River Thames to debut the London Bridge.

1936, Yves St. Laurent was born.

1936, The Berlin Olympics opening ceremony took place.

1944, Anne Frank writes the last entry in her diary before her hidden family is discovered.

1960, Aretha Franklin records her first studio demos which lands her a contract with Columbia Records.

1990, The World Wide Web was established.

Computers make very fast, very accurate mistakes.

Retirement?

Alfred Feld started working for Goldman Sachs in 1933 as an office boy, when the U.S. unemployment rate was 25%, the Wall Street Journal reports.

He still works there.

Feld is now 98, and spent most of that time working as a financial advisor. While he no longer works directly with clients, he serves as a mentor and ambassador for the wealth-management arm of GS.

When the New York Times profiled him in 2008 for his 75th anniversary, he said he had no plans to retire.

What’s money?  A man is a success if he gets up in the morning and goes to bed at night and in between does what he wants to do. –Bob Dylan.

Photos of the Day –August 1st, 2013

More than 400 hot-air balloons take off in Chambley-Bussieres, eastern France, Wednesday in an attempt to set a world record for collective take-offs during an international hot-air balloon meeting. Alexandre Marchi/L’est Republicain/AP

Japanese actor Takeshi Tsuruno clowns around with a replica of the Velociraptor during the opening ceremony of the dinosaurs exhibition in Tokyo. Koji Sasahara/AP

Market Closes for August 1^st, 2013

Market  Index	Close	Change
Dow  Jones	15628.02	+128.48    +0.83%
S&P 500	1706.87	+21.14    +1.25%
NASDAQ	3675.744	+49.373    +1.36%
TSX	12593.96	+107.32
		+0.86%

International Markets

Market  Index	Close	Change
NIKKEI	14005.77	+337.45
		+2.47%
HANG  SENG	22088.79	+205.13
		+0.94%
SENSEX	19317.19	-28.51
		-0.15%
FTSE 100	6681.98	+60.92
		+0.92%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	2.547	2.452
CND.   30 Year Bond	3.043	2.971
U.S.   10 Year Bond	2.7060	2.5762
U.S.   30 Year Bond	3.7542	3.6353

Currencies

BOC Close	Today	Previous
Canadian $	0.96631	0.97221
US   $	1.03486	1.02858
Euro Rate  1 Euro=		Inverse
Canadian   $	1.36680	0.73163
US  $	1.32076	0.75714

Commodities

Gold	Close	Previous
London Gold   Fix	1305.18	1326.20
Oil	Close	Previous
WTI Crude Future	107.89	105.03
BRENT	109.359	109.359

Market Commentary:

Canada

By Katie Brennan

Aug. 1 (Bloomberg) — Canadian stocks rose, capping the biggest gain in three weeks, after companies reported higher- than-estimated earnings and manufacturing in the U.S. and China strengthened.

Suncor Energy Inc., Canada’s largest energy company by market value, advanced 3.9 percent after second-quarter profit more than doubled. Catamaran Corp., a manager of prescription drug benefits, surged 9.1 percent after boosting its profit forecast for the year and announcing an acquisition. Athabasca Oil Corp. and BlackPearl Resources Inc. added at least 10 percent as oil climbed the most since since July 10.

The Standard & Poor’s/TSX Composite Index gained 107.32 points, or 0.9 percent, to 12,593.96 at 4 p.m. in Toronto. The gauge advanced 3 percent last month, the largest increase since September 2012. Trading volume was 3.6 percent below the 30-day average.

“We saw strong manufacturing data out of China and the U.S., and another key driver we’ve had lately is earnings,” said Jeffrey Bradacs, a fund manager with Manulife Asset Management Ltd., in a phone interview from Toronto. He helps oversee about C$1.50 billion ($1.47 billion) with his team.

“Today we had a number of companies in Canada report with strong earnings and that is helping our market.”

China’s manufacturing unexpectedly expanded in July, suggesting a slowdown in the world’s second-largest economy may be stabilizing as the government rolls out targeted measures to support growth. The Institute for Supply Management’s U.S. manufacturing index grew at the fastest pace in more than two years as orders and production jumped. China and the U.S. are Canada’s largest trading partners.

Seven of 10 industries in the Canadian equity benchmark rose. Health-care and energy companies paced gains, adding at least 1.9 percent.

About 57 percent of the companies in the S&P/TSX that have reported earnings have exceeded analysts’ profit forecasts, data compiled by Bloomberg show. More than 90 companies in the gauge are scheduled to report earnings between tomorrow and the end of next week.

Catamaran surged 9.1 percent to a record C$59.03 after beating second-quarter earnings estimates and increasing its full-year profit forecast. The company also announced it will buy pharmacy benefit manager Restat for $409.5 million in cash.

Athabasca Oil climbed 10 percent to C$7.95 and BlackPearl Resources added 13 percent to C$1.81 as oil rose 2.7 percent.

Suncor Energy gained 3.9 percent to C$33.74. The company’s second-quarter profit more than doubled after earnings a year ago were crimped by a one-time charge on its Syrian operations.

Chief Executive Officer Steve Williams has been cutting costs by halting or delaying projects.

Potash Corp of Saskatchewan Inc. added 2.6 percent to C$30.56. The fertilizer producer fell 22 percent in two days after OAO Uralkali, the world’s largest potash producer, predicted prices for the crop nutrient will fall about 25 percent after it exits an export cartel.

Barrick Gold Corp. added 2.7 percent to C$17.46. The company reported sales and earnings excluding one-time items that surpassed analysts’ estimates.

Cameco Corp. fell 1.6 percent to C$20.53. The world’s third-largest uranium producer said it will sell less of the nuclear fuel via its German trading unit than previously planned prices have fallen 27 percent in the past year.

US

By Lu Wang and Nick Taborek

Aug. 1 (Bloomberg) — U.S. stocks rallied, sending the Standard & Poor’s 500 Index above 1,700 for the first time, after central banks vowed to maintain stimulus and data on global manufacturing beat forecasts.

All 10 S&P 500 main industries advanced. MetLife Inc. and Procter & Gamble Co. rose more than 1.7 percent as earnings topped estimates. DreamWorks Animation SKG Inc. jumped 8.8 percent as net income surged on the hit movie “The Croods.”

Exxon Mobil Corp. slid 1.1 percent as profit trailed estimates by the most in more than a decade.

The S&P 500 rose 1.3 percent to 1,706.87 at 4 p.m. in New York. The Dow Jones Industrial Average advanced 128.48 points, or 0.8 percent, to a record 15,628.02. About 6.8 billion shares changed hands, or 7 percent above the three-month average.

“Central banks throughout the world remain accommodative and you do not want to fight the central banks,” Phil Orlando, New York-based chief equity strategist at Federated Investors, which manages about $380 billion in assets, said by phone. “All of the data from an economic standpoint is telling that the economy is continuing to get better, the labor market is improving, and corporate earnings are coming in better than expected. So this market should continue to work higher.”

The Fed said yesterday that persistently low inflation could hamper the economy and pledged to keep buying $85 billion in bonds every month. The statement came as data showed the U.S. economy grew more than projected in the second quarter. European Central Bank President Mario Draghi said today that recent economic indicators signal that the euro region is through the worst and reiterated that officials plan to keep interest rates low for the foreseeable future.

Three rounds of bond purchases by the Fed, coupled with improving earnings and economic growth, has helped propel the S&P 500 up 152 percent from its bear-market low in 2009.

Speculation about the Fed’s monthly bond purchases has whipsawed stocks since May, when Chairman Ben S. Bernanke first indicated policy makers could begin reducing the stimulus this year if the job market continues to improve.

Investors poured $38.1 billion into exchange-traded funds listed in the U.S. last month, the most since December 2008 and the fourth-highest inflow ever, according to data compiled by Bloomberg since 2000. Almost $30 billion of the deposits went to funds that buy and sell American equities.

“When you see milestones, that gets people interested,” Randy Bateman, who oversees $15 billion as chief investment officer of Huntington Asset Advisors in Columbus, Ohio, said by phone. “Maybe there’s still a lot of money sitting on the sidelines that might be tempted to come into the market. I think it’s a bullish thing.”

The benchmark index gained 5 percent in July, its biggest monthly advance since January. The gauge is trading at 15.5 times estimated earnings, compared with an average valuation of 13.9 times profit over the past five years, according to data compiled by Bloomberg.

Manufacturing in the U.S. expanded at the fastest pace in more than two years as orders and production jumped, according to the Institute for Supply Management’s factory index. Separate reports overseas showed manufacturing grew more than forecast in China and Europe.

In the U.S., applications for unemployment insurance payments declined by 19,000 to 326,000 in the week ended July 27, the fewest since January 2008, the Labor Department reported today in Washington. The median forecast of 50 economists surveyed by Bloomberg called for 345,000.

Labor Department data tomorrow may show U.S. employers added 185,000 people to payrolls in July, as the jobless rate fell to 7.5 percent from 7.6 percent, according to Bloomberg surveys of more than 80 economists.

Some 40 companies in the S&P 500 were scheduled to report results today. Of the 373 companies in the gauge to have already reported quarterly results, 73 percent have exceeded analysts’ profit estimates and 56 percent have beaten sales projections, data compiled by Bloomberg show.

The Chicago Board Options Exchange Volatility Index, or VIX, slipped 3.8 percent to 12.94 today. The equity volatility gauge reached its highest level this year in June and has since fallen 37 percent.

Companies whose growth is most tied to economic swings led the rally. The Morgan Stanley Cyclical Index rose 1.8 percent.

The Dow Jones Transportation Average surged 3.2 percent to a record, while the Russell 1000 Index, the S&P Midcap 400 Index and the Russell 2000 Index for smaller companies hit all-time highs, climbing at least 1.3 percent. The Nasdaq Composite Index added 1.4 percent to the highest level since September 2000.

The KBW Bank Index rallied 1.9 percent as all its 24 members gained. American Express Co. advanced 2.5 percent to $75.63 for the biggest gain in the Dow, and Bank of America Corp. climbed 2.4 percent to $14.95.

MetLife jumped 6.3 percent to $51.47. The largest U.S. life insurer said earnings, which exclude some investment results, were $1.44 a share. That beat the $1.33 average estimate of 20 analysts surveyed by Bloomberg.

Procter & Gamble rose 1.7 percent to $81.64. Earnings beat analyst forecasts, giving Chief Executive Officer A.G. Lafley some breathing room as he works to turn around the company he rejoined two months ago.

DreamWorks climbed 8.8 percent to $26.95. The independent film studio run by Jeffrey Katzenberg reported a 75 percent surge in profit. “The Croods” was released on March 22 in the U.S. and later in countries including China and France, generating $71.8 million in revenue in the quarter.

Automakers advanced 2.2 percent as a group in the S&P 500, as vehicle sales extended a resurgence that’s putting the industry on course for its best year since 2007. Ford Motor Co. gained 1.8 percent to $17.19 as light-vehicle sales increased 11 percent in July. General Motors Co. rose 1.7 percent to $36.47 after its deliveries jumped 16 percent last month.

Industrial companies rose 1.7 percent as a group for the best performance among 10 S&P 500 groups. Quanta Services Inc. jumped 5 to $28.14. The biggest U.S. power line contractor exceeded analysts’ estimates for a ninth straight quarter, according to data compiled by Bloomberg. The company boosted its full-year forecast.

Yelp Inc. soared 23 percent to $51.50. The company, whose website compiles consumer-business reviews, said second-quarter sales climbed 69 percent to $55 million, topping the $53.3 million average analyst prediction compiled by Bloomberg.

CBS Corp. gained 3.9 percent to $54.88. The owner of the most-watched U.S. TV network said second-quarter profit rose 11 percent, spurred by higher rates from pay-TV systems and new Internet streaming agreements.

Pioneer Natural Resources Co. jumped 13 percent to $174.15.

At least three analysts raised their share-price forecasts for the oil and gas producer, according to data compiled by Bloomberg. Results from Pioneer’s Wolfcamp drilling site appear to show the company has “established a giant resource play,” Jonathan Wolff, an analyst with International Strategy & Investment Group LLC, wrote in a note.

Sprouts Farmers Market LLC more than doubled to $40.11 on the first day of trading. The organic grocery chain and existing owners sold 18.5 million shares, or a 13 percent stake, for $18 apiece, pricing its initial public offering above the marketed range as increasing consumer confidence ignites interest in companies from restaurants to cruise lines.

Exxon Mobil dropped 1.1 percent to $92.73. The world’s biggest energy company by market value reported profit of $1.55 a share as returns from its fuel-making business plunged. That missed the average analyst estimate by 18 percent, the biggest gap since at least the fourth quarter of 2002.

 

Have a wonderful evening everyone.

 

Be magnificent!

 

Everyone is but a manifestation of the Impersonal, the basis of all being,

and misery consists in thinking of ourselves as different from this Infinite, Impersonal Being,

and liberation consists in knowing our unity with this wonderful Impersonality.

Swami Vivekananda, 1863-1902

As ever,

 

A smile is happiness you’ll find

right under your nose.

-Tom Wilson

Carolann

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