Month: May 2016

Dear Friends,

Tangents:

Israel was established 68 years ago today.

Anne Frank was born on this day in 1929.

Florence Nightingale was born on this day in 1820.

Kate Hepburn was born on this day in 1907.

And because Edward Lear, the limericist was born on this day in 1812, it is LIMERICK DAY.

There was a Young Lady whose eyes,
Were unique as to colour and size.
When she opened them wide,
People all turned aside,
And started away in surprise.
                   -Edward Lear

Also on this day, in 1932, the body of Charles Lindbergh’s baby is found in Hopewell N.J., a short distance from the Lindbergh residence. Charles Augustus Lindbergh, Jr. was kidnapped from the family’s home more than two months earlier. The crime and subsequent trial captured the world’s attention.

PHOTOS OF THE DAY

Solar Impulse 2, a solar powered airplane piloted by Swiss adventurer Bertrand Piccard, takes off from Phoenix Goodyear Airport on Thursday. Solar Impulse 2 took off from Arizona at 10:05 AM UTC, 12:05 PM CET, 3:05 AM local time for a journey that is expected to last 17 hours and 50 minutes until landing in Tulsa, Oklahoma. Jean Revillard/SI2/Reuters

A girl watches as Israeli Air Force CH-53 helicopters fly over the Mediterranean Sea during an aerial show as part of the celebrations for Israel’s Independence Day marking the 68th anniversary of the creation of the state in Tel Aviv, Israel on Thursday. Baz Ratner/Reuters

Market Closes for May 12^th, 2016

Market Index	Close	Change
Dow Jones	17720.50	+9.38   +0.05%
S&P 500	2064.11	-0.35   -0.02%
NASDAQ	4737.336	-23.352   -0.49%
TSX	13787.80	-0.41
		—

International Markets

Market Index	Close	Change
NIKKEI	16646.34	+67.33
		+0.41%
HANG SENG	19915.46	-139.83
		-0.70%
SENSEX	25790.22	+193.20
		+0.75%
FTSE 100	6104.19	-58.30
		-0.95%

Bonds

Bonds	% Yield	Previous  % Yield
CND. 10 Year Bond	1.317	1.299
CND. 30 Year Bond	1.985	1.964
U.S.    10 Year Bond	1.7516	1.7315
U.S. 30 Year Bond	2.5983	2.5762

Currencies

BOC Close	Today	Previous
Canadian $	0.77861	0.77860
US $	1.28434	1.28436
Euro Rate 1 Euro=		Inverse
Canadian $	1.46090	0.68451
US $	1.13747	0.87914

Commodities

Gold	Close	Previous
London Gold Fix	1279.25	1276.85
Oil	Close	Previous
WTI Crude Future	46.70	46.23

Market Commentary:

QUOTE OF THE DAY

“We’re, frankly, scratching our heads”

Macy’s Chief Financial Officer Karen Hoguet on the country’s largest department-store chain reporting its worst quarterly sales since the recession. With saving rates high, wages growing and employment data steady, Macy’s executives were at a loss to explain why consumers weren’t spending in its stores. 

Canada

By Eric Lam

     (Bloomberg) — Canadian stocks ended the day flat, as a retreat by natural-resource producers was offset by gains in energy after crude settled at a six-month high. Oil rebounded amid signs of a reduction in global supply while Canadian oil- sands production is coming back online.

     The benchmark S&P/TSX Composite Index lost less than an index point to 13,787.80 at 4 p.m. in Toronto, erasing an earlier advance of as much as 0.7 percent. Four of 10 industries in the S&P/TSX declined. Volume was 4.9 percent lower than the 30-day average. The gauge now trades at 20.9 times earnings, about 9.3 percent higher than the 19.2 times valuation of the S&P 500, data compiled by Bloomberg show.

     Crescent Point Energy Corp. jumped 4.9 percent for a third day of gains. The company reported a first-quarter loss narrower than analysts had forecast. Energy producers ended higher after swinging between gains and losses.

     Oil futures in New York swung between gains and losses, adding 47 cents to settle at $46.70 a barrel for a six-month high. Nigeria said militants have curbed the country’s oil output by about 30 percent, while Canadian oil-sands producers are starting the process of resuming operations after wildfires around Fort McMurray in Alberta disrupted production in the past week.

     Raw-materials producers slumped 1.8 percent, the second- most in the S&P/TSX. Barrick Gold Corp. lost 1.9 percent while First Quantum Minerals Ltd. retreated 5.3 percent to lead base- metals producers lower. Gold futures fell as the dollar rose after trading little changed against a basket of 10 currencies. The greenback strengthened against the yen amid speculation of further monetary easing by the Bank of Japan.

     Goldcorp Inc. tumbled 3.9 percent after agreeing to buy Kaminak Gold Corp. in a share-swap deal worth C$520 million ($406 million). The purchase price values Kaminak at a 40 percent premium to its 20-day average, and will involve Goldcorp issuing about 21.6 million shares.

     Health-care stocks lagged the most as Valeant Pharmaceuticals International Inc. dropped 5.6 percent. The stock has slumped 30 percent during a seven-day slide, the longest losing streak for the embattled drugmaker in almost two years. 

     Valeant’s new CEO Joseph Papa was criticized by the leader who took over his previous company. As well, most U.S. hospitals are not receiving promised discounts of as much as 30 percent for two heart medications that have seen steep price increases, despite Valeant pledging to Congress to do so, the New York Times reported.

US

By Dani Burger

     (Bloomberg) — U.S. stocks closed little changed in a whipsaw session, as rising oil prices bolstered an afternoon rebound while a selloff in Apple Inc. was offset by gains in Monsanto Co.

     Apple fell to a 22-month low after a report fueled speculation iPhone sales continue to slump. Monsanto jumped 8.4 percent as people familiar with the matter said Bayer AG is exploring a potential bid for its U.S. competitor. Kohl’s Corp. sank 9.2 percent after its earnings and sales results missed predictions, adding to worry that consumers haven’t loosened spending habits even as economists forecast that a government report Friday will show the biggest gain in retail sales in 11 months.

     The S&P 500 fell less than 0.1 percent to 2,064.11 at 4 p.m. in New York, after swinging between gains and losses. The worst of the days declines halted at the index’s average price during the past 50 days. The Dow Jones Industrial Average rose 9.38 points, or 0.1 percent, to 17,720.50, after losing nearly 86 points. The Nasdaq Composite Index lost 0.5 percent amid Apple’s slump. About 7.1 billion shares traded hands on U.S. exchanges, 5 percent below the three-month average.

     “The markets have expended a lot of energy to stay flat,”  said Eric Wiegand, senior portfolio manager at the Private Client Reserve of U.S. Bank in New York, which oversees $125 billion. “It really is like trying to tread water in a very choppy environment. We’re seeing a lot of rotation beneath the surface. We’re not surprised by volatility. Not just some downside volatility like yesterday, but the potential for upside price movements as well.”

     A roller-coaster week continued as equities struggled to regain upward momentum that has remained elusive since the S&P 500 reached a four-month high three weeks ago. The benchmark rallied the most in two months on Tuesday amid a rebound in commodities, only to dive yesterday after disappointing results from Walt Disney Co. and Macy’s Inc. battered consumer shares and sparked a broader selloff.

     With Apple souring sentiment in the tech group, semiconductor shares fell to a two-month low. Micron Technology Inc. and Skyworks Solutions Inc. dropped at least 4.5 percent, while Intel Corp. fell 1 percent. Elsewhere, Allergan Plc and Gilead Sciences Inc. lost at least 1.3 percent to pace a slide in health-care. The Nasdaq Biotechnology Index sank 1.7 percent, bringing its two-day retreat to 4.7 percent.

     Stocks have churned after the S&P 500 last month reached the highest level since Dec. 1 and came within 1.4 percent of a record set a year ago. The gauge surged as much as 15 percent from a 22-month low in February as crude rebounded, weakness in China showed signs of stabilizing and central bankers signaled they’ll maintain efforts to boost growth. Since the recent high on April 20, the benchmark has ambled in 70-point range as tepid earnings and economic data cooled investors’ risk appetite.

     A report today showed applications for unemployment benefits unexpectedly increased to the highest level since February 2015, signaling a more modest recovery lies ahead as companies adjust headcounts after a first-quarter slowdown in demand. The government’s retail sales data due on Friday are forecast to show a rebound for April after unexpectedly declining in March. Readings on consumer sentiment, producer prices and business inventories are also scheduled for release tomorrow.

     Weaker-than-predicted monthly payrolls figures last week helped push back expectations for Federal Reserve rate increases, with traders pricing in only a 4 percent chance the central bank will act in June. December is now the first month with at least even odds of higher borrowing costs.

     Boston Fed President Eric Rosengren sounded a hawkish note today, saying recent data warrant continued gradual rate increases and policy makers could risk stoking a bubble in the commercial real estate market if they delay action for too long.

     With the earnings season drawing to a close, analysts estimate income at S&P 500 companies fell 7.4 percent in the first quarter. Among the 90 percent members that have announced results so far this season, 75 percent beat profit forecasts, and 54 percent exceeded sales expectations.

     “Part of what’s helping the market is that investor expectations on earnings are generally not so high,” said Frances Hudson, a global thematic strategist at Standard Life Investments in Edinburgh. “Retail sales will be an important indicator tomorrow, as the U.S. consumer has been stalwart to the economy.”

     The CBOE Volatility Index fell 1.9 percent Thursday to 14.41, wiping out a climb of as much as 5 percent. The measure of market turbulence known as the VIX is down 8 percent this month after rising 13 percent in April.

     In Thursday’s trading, seven of the S&P 500’s 10 main industries advanced, with phone, raw-material and consumer staples companies rising at least 0.4 percent. Health-care shares lost 0.6 percent, while the technology group slipped 0.4 percent after falling as much as 1.1 percent.

     Monsanto’s strongest rally since August boosted the raw materials group. The potential takeover by German competitor Bayer looks to extend a record-setting pace for consolidation in the chemical sector, as low crop prices drive mega-deals in agriculture. Sealed Air Corp. gained 2.5 percent after Goldman Sachs Group Inc. rated the shares a buy.

     Industrial stocks fell for the third time in four days, with airlines weighing the most. The Dow Jones Transportation Average marked the biggest back-to-back decline since Jan. 8, with air carriers pummeled for a second day. JetBlue Airways Corp. and United Continental Holdings Inc. slid more than 4.4 percent, while a Bloomberg index of U.S. airlines dropped to a three-month low.

Have a wonderful evening everyone.

 

Be magnificent!

Where we suffer we have made it into a personal affair.

We shut out all the suffering of mankind.

Krishnamurti

As ever,

 

Carolann

 

Well done is better than well said.

 -Benjamin Franklin, 1706-1790

 

Carolann Steinhoff, B.Sc., CFP®, CIM, CIWM

Portfolio Manager &

Senior Vice-President

 

Queensbury Securities Inc.,

St. Andrew’s Square,

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7

Dear Friends,

Tangents:

WE ARE THE DECISIVE ELEMENT

I have come to the frightening conclusion that I am the decisive element.
It is my personal  approach that creates the climate.
It is my daily mood that makes the weather.
I possess tremendous power to make life miserable or joyous.
I can be a tool of torture or an instrument of inspiration.
I can humiliate or humor, hurt or heal.
In all situations, it is my response that decides whether a crises is escalated or de-escalated, and a
person is humanized or dehumanized…

                 -Johann Wolfgang von Goethe, 1749-1832

AWAKENING GATHA/ Deena Metzger
Waking in the morning
Time smiles in my hand.
This dawn
Lasts all day.

PHOTOS OF THE DAY

A couple holding a baby pose for a selfie on a breakwater on the edge of the Mediterranean Sea in Barcelona, Spain on Tuesday. Emilio Morenatti/AP

Guests attend a garden party at Buckingham Palace in London on Tuesday. Every summer, the Queen hosts at least three such parties that are attended by people from all walks of life. Garden parties have been held at the palace since the 1860s, when Queen Victoria instituted what were known as ‘breakfasts,’ though they took place in the afternoon. John Stillwell/AP

Market Closes for May 10^th, 2016

Market Index	Close	Change
Dow Jones	17928.35	+222.44   +1.26%
S&P 500	2084.39	+25.70   +1.25%
NASDAQ	4809.879	+59.670   +1.26%
TSX	13775.19	+211.35
		+1.56%

International Markets

Market Index	Close	Change
NIKKEI	16565.19	+349.16
		+2.15%
HANG SENG	20242.68	+85.87
		+0.43%
SENSEX	25772.53	+83.67
		+0.33%
FTSE 100	6156.65	+41.84
		+0.68%

Bonds

Bonds	% Yield	Previous  % Yield
CND. 10 Year Bond	1.315	1.317
CND. 30 Year Bond	1.964	1.968
U.S.    10 Year Bond	1.7613	1.7507
U.S. 30 Year Bond	2.6122	2.6083

Currencies

BOC Close	Today	Previous
Canadian $	0.77461	0.77148
US $	1.29097	1.29620
Euro Rate 1 Euro=		Inverse
Canadian $	1.46840	0.68101
US $	1.13744	0.87917

Commodities

Gold	Close	Previous
London Gold Fix	1262.80	1265.25
Oil	Close	Previous
WTI Crude Future	44.66	43.44

Market Commentary:

Canada

By Eric Lam

     (Bloomberg) — Canadian stocks climbed the most since February, rebounding from a month low, as the nation’s largest lenders and natural resource producers rose following reports oil-sands producers will restart production after wildfires that engulfed northern Alberta moved away from their facilities.

     The benchmark S&P/TSX Composite Index jumped 1.6 percent to 13,775.19 at 4 p.m. in Toronto, for the steepest gain in almost three months. The gauge now trades at 20.9 times earnings, about 8 percent higher than the 19.4 times valuation of the S&P 500, data compiled by Bloomberg show. Volume was in line with the 30- day average.

     Energy producers climbed 2.3 percent as a group, the biggest contributor to gains in the S&P/TSX. Suncor Energy Inc. and Canadian Natural Resources Ltd. added more than 3.1 percent. Crude futures bounced back from a two-week low, trading above $44 a barrel in New York. 

     Producers including Suncor, Syncrude Canada Ltd. and Royal Dutch Shell Plc took an estimated 1 million barrels a day offline over the past week due to the wildfires surrounding Fort McMurray in Alberta. The companies are now seeking to bring workers back and start up plants. Canadian officials said Monday rain and cooler temperatures were helping firefighters battle the flames, which still cover an area the size of New York City.

     Canadian oil and gas companies are leading a drop in investment plans for a second year, with spending by companies and governments on non-residential construction, machinery and equipment to fall 4.4 percent in 2016, according to Statistics Canada. Capital spending in the mining, quarrying and oil and gas industry will drop 23 percent this year.

     Royal Bank of Canada and Bank of Nova Scotia added at least 1 percent as financial services stocks increased as a group. Industrial shares also rallied, pacing gains with railway operators Canadian National Railway Co. and Canadian Pacific Railway Ltd. Raw-materials producers soared 3 percent as a group, as industrial metals rebounded after posting the biggest selloff in two months.

     Intertape Polymer Group Inc. sank 7.6 percent, the most since August, after first-quarter revenue that trailed analysts’ estimates were blamed on the South Carolina flood. The flood resulted in about $5 million worth of lost sales of masking tape and stencil products, the company said.

     Badger Daylighting Ltd.ended 0.2 percent higher. Shares tumbled as much as 9.2 percent after posting first-quarter earnings that fell short of analysts’ expectations. Cash flow from operations plunged 36 percent from year-ago levels amid lower revenue and gross profit. The excavating company also raised its dividend.

US

By Dani Burger

     (Bloomberg) — The bearish sentiment that hit traders in the past two weeks eased amid a bounce in commodities, with U.S. stocks rising the most in two months to join in equity market gains from Japan to Europe.

     Energy producers, industrial shares, banks and Amazon.com Inc. were among the strongest contributors to a rally that jolted equities out of a recent torpor. The online retail giant climbed 3.4 percent to an all-time high after an analyst boosted their price target on the shares to $1,000. The Bloomberg Commodity Index rebounded from the biggest drop in six weeks, bolstering sentiment toward raw-material companies. After the markets closed, Walt Disney Co. fell as its earnings missed estimates.

     The S&P 500 jumped 1.3 percent to 2,084.39 at 4 p.m. in New York, the most since March 11. The gauge ended an 18-session streak without a 1 percent move in either direction, the longest period of calm since 2014. It was a third day of gains in a recovery from the first back-to-back weekly drop since February. The Dow Jones Industrial Average added 222.44 points, or 1.3 percent, to 17,928.35, the biggest increase in eight weeks. The Nasdaq Composite Index also advanced 1.3 percent.

     “Some of the same factors driving commodities are driving global growth and equities in general,” said Greg Woodard, a senior analyst and strategist at Fairport, New York-based Manning & Napier Inc., which oversees about $46 billion. “If they feel better about growth in China, in emerging markets and global growth, they feel more positive about equities and commodities. The commodity space is really a barometer as opposed to driving equities.”

     After sliding 2.5 percent from its April high through last Thursday, the S&P 500 began a rebound on Friday as worse-than- estimated payrolls data spurred speculation the Federal Reserve will adopt a slower pace in tightening monetary policy. Traders are pricing in only a 6 percent chance of higher interest rates in June, compared with 20 percent in April. The first month with at least even odds of an increase has been pushed back to February 2017.

     The main U.S. equity benchmark jumped 15 percent from its February low through April 20, when it reached a four-month high and came within 1.4 percent of the record set last year. The index has struggled since to extend gains amid lackluster corporate results, particularly from technology giants such as Apple Inc. and Microsoft Corp., as well as subdued economic indicators that damped investor appetite for risky assets.

     As the earnings season draws to a close, analysts have moderated their predictions for a decline in first-quarter profits to 7.4 percent, from 9.5 percent at the start of April. So far, about 75 percent of the firms that have released results beat profit estimates, and 55 percent exceeded sales projections. Walt Disney tumbled 6.2 percent as of 4:42 p.m. after its results missed analysts’ estimates as earnings at the company’s ABC TV network and consumer-products division declined.                        

     Along with earnings, investors continue to scrutinize data for clues on the health of the economy and the path for interest rates. A report today showed signs the labor market remained solid in the first quarter, as job openings rose more than projected in March to the second-highest in data back to 2000.

     The CBOE Volatility Index fell 6.5 percent Tuesday to 13.63, slipping for a fourth day to a two-week low. The measure of market turbulence known as the VIX is down 13 percent so far this month, after a 13 percent climb in April. About 6.7 billion shares traded hands on U.S. exchanges, 12 percent below the three-month average.

     Meanwhile, Tuesday’s trading was an about-face from yesterday’s session as commodity sensitive sectors led gains among the S&P 500’s 10 main groups. Energy and raw-material producers climbed as much as 1.8 percent as oil rose 2.8 percent from a two-week low, amid concern supplies from two of Africa’s largest crude reserves could be disrupted. Hess Corp. and Devon Energy Corp. advanced more than 4.9 percent, while services giant Schlumberger Ltd. added 2.1 percent.

     Financial companies also recovered from yesterday’s losses, advancing 1.4 percent as a group. Leucadia National Corp. gained 5.9 percent, the most in more than four years, after agreeing to acquire ITG Investment Research. JPMorgan Chase & Co. and Bank of America Corp. rose at least 1.3 percent, while the KBW Bank Index had its strongest climb since April 13. Goldman Sachs Group Inc. increased 2.5 percent, the steepest in almost three weeks.                         

     Amazon climbed for a third day after Sanford C. Bernstein & Co Inc. analyst Carlos Kirjner lifted his price target on the shares to a street-high $1,000 from $770, citing profit margins that are likely to expand faster in the next two years. The stock has surged 46 percent in three months, the biggest contributor to the S&P 500’s rebound from a 22-month low.

     Boeing Co. climbed 2 percent, one of the Dow’s biggest gainers today. The planemaker is scheduled to meet with analysts tomorrow, and is in the midst of defending its rainmaker 737 jet as its competition grows. With its fate tied closely to the prospects for commodities, Caterpillar Inc. flipped from worst in the Dow yesterday to second-best today, rising 2.4 percent.

     Among other industrial stocks, Dun & Bradstreet Corp. gained 7 percent to a nine-month high after it reported earnings yesterday that beat analysts’ estimates. Railroads Union Pacific Corp. and Norfolk Southern Corp. increased more than 1.7 percent. As a group, industrial shares in the S&P 500 rose 1.7 percent, the most since March 17.

     International Flavors & Fragrances Inc. led gains among raw-materials companies, surging 5.3 percent to a record after its quarterly sales and earnings exceeded predictions. Dow Chemical Co. increased 1.4 percent and Freeport-McMoRan Inc. rose 3.2 percent after an 11 percent slide on Monday.                      

     Technology companies advanced for a fourth day, the longest streak of gains in seven weeks. Microsoft Corp. and Google parent Alphabet Inc. each added at least 1.4 percent. Akamai Technologies Inc. and Western Digital Corp. topped the group, rising more than 3.6 percent.

     Health-care shares were near the bottom of the S&P 500’s 10 main industries, though still closed with the best two-day gain in a month. Allergan Plc rose 5.3 percent as the maker of the anti-wrinkle injection Botox plans to buy back as much as $10 billion in stock after completing the $40 billion sale of its generics business to Teva Pharmaceutical Industries Ltd. The company also reported earnings that beat analysts’ projections.

     Pfizer Inc. was one of two Dow components to decline, closing little changed after falling as much as 1 percent. Zoetis Inc. slipped 2 percent after people familiar with the matter said Pershing Square Holdings Ltd., the publicly traded security of Bill Ackman’s activist hedge fund, is selling part of its stake in health-care company.

     Gap Inc. was the biggest loser in the S&P 500, falling almost 12 percent after the apparel chain posted disappointing results. The shares sank to the lowest since January 2012. Kohl’s Corp., Urban Outfitters Inc. and Macy’s Inc. each lost more than 1.5 percent. Macy’s is scheduled to report results tomorrow.

     HCP Inc. and Welltower Inc. fell more than 2.2 percent as the health-care REITs slipped following Genesis Healthcare Inc.’s earnings miss. Genesis tumbled 24 percent to a two-month low after the company also cut its 2016 profit outlook below analysts’ estimates.

Have a wonderful evening everyone.

 

Be magnificent!

Nonviolence is not a cloistered virtue to be practiced

by the individual for peace and final salvation,

but it is a rule of conduct for society,

if it is to live consistently with human dignity

and make progress towards the attainment of peace

for which it has been yearning for ages past.

Mahatma Gandhi

As ever,

 

Carolann

 

Doubt kills more dreams than failure ever will.

                              -Suzy Kassem, b. 1975

 

Carolann Steinhoff, B.Sc., CFP®, CIM, CIWM

Portfolio Manager &

Senior Vice-President

 

Queensbury Securities Inc.,

St. Andrew’s Square,

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7

Dear Friends,

Tangents:

Poem – Selected by Matthew Zapruder, NY Times, 5/8/2016

Along with the epic and the dramatic play, the lyric was one of the earliest forms of poetry: a song of personal emotion, sung by a single voice to the accompaniment of a strummed instrument, a lyre.  For a long time the lyre itself has been implied, but the best lyric poems still sound like songs.

Vall de Núria

By Rowan Ricardo Phillips

The white rose.  The celestial silence.
The lake of light. The bed-like inner thigh
Of empyrean buttermilk and gold,
Call it what you will, it wakes me tonight.
Heaven reheavens.  And the mind’s prelude
To the touch of your lips on my forehead,
On my neck, our drowned echoes celloing
In the dark like flames drawn on the ocean,
Is not the mind’s prelude but its heaven.
How somewhere not in Spain there’s a mountain
Borrowing your name, my soul is its snow,
And so in the summer I am nothing,
When all I want to do is lay my head
Down, lay my head down on the naked slope
Of your chest and listen there for my heart.

Matthew Zupruder is the author of four collections of poetry, most recently “Sun Bear.”  He teaches at Saint Mary’s College of California and is the editor at large at Wave Books.  Rowan Ricardo Phillips is the winner of a Whiting Award.  His second collection f poetry, “Heaven,” was published by Farrar, Straus & Giroux last year.

PHOTOS OF THE DAY

An American flag is silhouetted as the planet Mercury is seen, lower left quadrant, transiting across the face of the sun in Las Vegas, Nevada on Monday. Mercury passes between Earth and the sun only about 13 times a century, with the previous transit taking place in 2006. David Becker/Reuters

‘Maya’ girl Irene Garcia Sieteiglesias sits at an altar during “Las Mayas” festivity in Madrid, Spain on Sunday. ‘Las Mayas’ festival is held annually at the beginning of May to celebrate the awakening of nature in Spring. Susana Vera/Reuters

Market Closes for May 9^th, 2016

MarketIndex	Close	Change
DowJones	17705.91	-34.72  -0.20%
S&P 500	2058.69	+1.55  +0.08%
NASDAQ	4750.211	+14.056  +0.30%
TSX	13563.84	-137.63
		-1.00%

International Markets

MarketIndex	Close	Change
NIKKEI	16216.03	+109.31
		+0.68%
HANGSENG	20156.81	+46.94
		+0.23%
SENSEX	25688.86	+460.36
		+1.82%
FTSE 100	6114.81	-10.89
		-0.18%

Bonds

Bonds	% Yield	Previous  % Yield
CND.10 Year Bond	1.317	1.357
CND.30 Year Bond	1.968	1.990
U.S.   10 Year Bond	1.7507	1.7789
U.S.30 Year Bond	2.6083	2.6276

Currencies

BOC Close	Today	Previous
Canadian $	0.77148	0.77453
US$	1.29620	1.29110
Euro Rate1 Euro=		Inverse
Canadian $	1.44532	0.67782
US$	1.13819	0.87859

Commodities

Gold	Close	Previous
London GoldFix	1265.25	1289.00
Oil	Close	Previous
WTI Crude Future	43.44	44.66

Market Commentary:

Canada

By Oliver Renick

     (Bloomberg) — Canadian stocks slid, extending last week’s retreat, as commodity prices fell and wildfires raging through Alberta appeared set to move away from one of the country’s oil- producing regions.

     The benchmark S&P/TSX Composite Index lost 1 percent to 13,563.84 at 4 p.m. in Toronto, falling for the first time in three sessions. The gauge now trades at 20.6 times earnings, about 7.9 percent higher than the S&P 500’s 19.1 times earnings valuation, data compiled by Bloomberg show. Volume in the measure was about 7 percent lower than the 30-day average at closing time.

     The Bloomberg Commodity Index dropped for the fifth time in six sessions. All but seven companies in the S&P/TSX raw- materials index slid on Monday. Teck Resources Ltd. and First Quantum Minerals Ltd. led losses, slumping more than 11 percent.

     Gold producers also fell with the precious metal, which lost 2.1 percent to $1,266.60 an ounce in New York, the biggest loss since Feb. 16. Yamana Gold Inc. sank 7.3 percent, while Barrick Gold Corp. lost 5.5 percent, the most in six weeks.

     Crude oil fell 2.7 percent to a two-week low, as shifting winds moved wildfires away from oil-sands facilities in Alberta, reducing concern that production cuts would make a substantial dent in U.S. oil stockpiles. Suncor Energy Inc. dropped 1.8 percent, and Encana Corp. sank 4.1 percent to a one-month low.

     Consumer discretionary stocks led gains in the S&P/TSX with advances of at least 3.8 percent in Performance Sports Group Ltd and Dorel Industries.

     Temple Hotels Inc. tumbled 15 percent, the most in seven years. The shares had surged 56 percent in the three prior sessions amid the wildfires in Alberta. The company has nine properties in the Ft. McMurray area, with insurance coverage for loss of revenue.

     Valeant Pharmaceuticals International Inc. fell 5.2 percent to weigh on the health-care group, with the stock dropping for the sixth time in seven days. The embattled drugmaker reiterated its revenue and earnings estimates for the first quarter, saying it expects to submit its regulatory filing by June 10, ahead of a July 31 deadline in its debt agreement.

US

By Dani Burger

     (Bloomberg) — The S&P 500 closed little changed as a rally in health-care shares was offset by declines among commodity producers, while investors awaited a final batch of earnings reports and further clues on prospects for the economy.

     Health-care stocks jumped after their worst two weeks since February, while energy producers slid for a second day amid lower crude prices. Weaker metals prices sent other commodity shares lower. Freeport-McMoRan Inc. dropped 11 percent as copper sank and the company agreed to sell one of its mines. LendingClub Corp. tumbled 35 percent after its chief executive resigned as an internal review found abuses tied to the sale of loans.

     The S&P 500 rose 0.1 percent to 2,058.69 at 4 p.m. in New York, after its first back-to-back weekly losses since February. The Dow Jones Industrial Average lost 34.72 points, or 0.2 percent, to 17,705.91. The Nasdaq Composite Index increased 0.3 percent, buoyed by drug developers, to mark its first two-day climb since April 13. About 6.8 billion shares traded hands on U.S. exchanges, 11 percent below the three-month average.

     “What’s helping right now on the upside is consumer discretionary, staples and health,” said Brian Frank, portfolio manager at Frank Capital Partners LLC. “It’s the old bifurcated market story, with energy and materials down while the rest of the market is up. Metals are under a lot of pressure right now, with stockpiles up significantly.”

     The weakness in commodity shares showed evidence of simmering pessimism on the pace of global growth. Chinese trade figures released during the weekend showed exports fell in dollar terms in April and imports dropped for the 18th month in a row. Crude fell 2.7 percent as shifting winds moved wildfires away from oil-sands facilities in Alberta, Canada, reducing concern that production cuts would make a substantial dent in U.S. stockpiles.

     The main U.S. equity benchmark snapped a three-day decline on Friday after worse-than-estimated payrolls data stoked speculation the Federal Reserve will adopt a slower pace in tightening monetary policy. Traders are pricing in only a 4 percent chance of higher borrowing costs in June, compared with 20 percent a month ago.

     Still, influential bond investors warn not to count out the Fed. Bill Gross, former manager of the biggest bond fund, said policy makers may act at their next meeting in June. Mohamed El- Erian, chief economic adviser at Allianz SE, said the Fed may move twice this year. Mark Kiesel at Pacific Investment Management Co. and New York Fed President William Dudley echoed the comments.

     The S&P 500 has slipped about 2 percent since its April 20 peak, putting a brake on a 15 percent rise from the index’s 22- month low in February. Tepid first-quarter corporate results, particularly from technology giants such as Apple Inc. and Microsoft Corp., as well as subdued economic indicators damped investor appetite for risky assets after the gauge approached its all-time high set last May. The benchmark on Monday held within a 10-point band, the narrowest range in three weeks.

     Analysts have moderated their predictions for a declinein first-quarter earnings to 7.4 percent, from 9.5 percent at the start of April. According to one measure of corporate optimism, companies that forecast profit will exceed analyst estimates just outnumbered those that warn earnings will trail projections. A pause in the drumbeat of bad news on earnings would be welcome by bulls who’ve watched stock swings widen and rallies die as share prices approached record levels reached 12 months ago.

     Traders will also parse economic releases for clues on U.S. growth prospects, including data on retail sales and jobless claims later this week. Chicago Fed President Charles Evans said in a panel discussion in London today that the U.S. central bank is “just being careful” by pausing in its campaign to raise rates, and that borrowing costs should increase later in the year if economic fundamentals remain sound.

     “We’re starting to see with Friday’s payrolls that the Fed will not raise rates in June, so at least that risk is gone,” said Jasper Lawler, a London-based market analyst at CMC Markets Plc. “Investors will be looking toward retail sales this week for further indications.”

     Health-care companies were the best performers among the S&P 500’s 10 main industries, capping the strongest daily advance in more than a month. Generic drugmakers pushed the group higher, after Teva Pharmaceutical Industries Ltd. said falling prices of generic drugs would start to stabilize.

     Teva gained 5.1 percent, the most since October, while Mylan NV and Perrigo Co. added at least 1.5 percent. Allergan Plc, whose generic business Teva plans to acquire by June, climbed 6 percent for its biggest increase in six months. The Nasdaq Biotechnology Index rallied 2.5 percent, the most since April 21 after dropping more than 11 percent in the subsequent two weeks. Celgene Corp. and Biogen Inc. each added at least 2.1 percent.

     Krispy Kreme Doughnuts Inc. surged to its best performance in nearly five years after JAB Holdings announced it would buy the doughnut maker in a $1.35 billion transaction. The $21 a share offer is 25 percent higher than Krispy Kreme’s average closing level in the past 20 trading sessions.

     Grocer Kroger Co. added 3.7 percent, the best in almost three months, while Hormel Foods Corp. rose 3.1 percent to lead the advance among consumer staples. The group reached a one- month high and Wal-Mart Stores Inc. climbed for a fourth day, the longest winning streak in more than two months. Chipotle Mexican Grill Inc. and Darden Restaurants Inc. increased at least 3.1 percent to lead gains among discretionary stocks.

     The energy and raw-material groups sank the most as crude and metals dropped to reverse Friday’s advance. Energy producers fell 1.3 percent, cutting early losses by almost half. Diamond Offshore Drilling Inc. and Transocean Ltd. lost more than 6.4 percent, while Chevron Corp. declined 1.5 percent.

     Freeport-McMoRan saw the steepest slide among raw-materials companies, falling 11 percent, and is now down 25 percent since April ended. The copper producer said Monday it agreed to sell its Democratic Republic of Congo mine in an attempt to reduce debt racked up in the commodities boom. Imports of copper by China slumped in April from a record the previous month after swelling stockpiles in the top user discouraged purchases.

     The Bloomberg Commodity Index had its largest drop in six weeks, helping to drag mining machinery maker Caterpillar Inc. to a two-month low. Newmont Mining Corp. sank 6.7 percent, after a 5.5 percent jump in the prior two sessions, as gold fell for the fifth time in six days. Alcoa Inc. dropped 5.8 percent to a one-month low, taking its May retreat to 15 percent. The shares had surged nearly 17 percent in April.

     The CBOE Volatility Index fell 1 percent to 14.57. The measure of market turbulence known as the VIX slipped 6.2 percent last week, its third drop in the last four.

 

Have a wonderful evening everyone.

 

Be magnificent!

 

Nonviolence and cowardice go ill together.

I can imagine a fully armed man to be at heart a  coward.

Possession of arms implies an element of fear, if not cowardice.

But true nonviolence is impossible without the possession of unadultereated fearlessness.

Mahatma Gandhi

 

As ever,

 

Carolann

 

 

Storms make the oak grow deeper roots.

              -George Herbert, 1875-1957

Carolann Steinhoff, B.Sc., CFP®, CIM, CIWM

Portfolio Manager &

Senior Vice-President

 

Queensbury Securities Inc.,

St. Andrew’s Square,

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7

Dear Friends,

Tangents: HAPPY MOTHER’S DAY WEEKEND!

Just returned from the Sohn Investment Conference in NYC and, as always, it was terrific – great investment ideas proposed by every speaker – and, as to be expected, many contradictory ones.   Most of the attendees presented after suffering terrible returns in 2015.  Pershing Square’s Bill Ackman, who presented the bullish case for Valeant last year (and now is working to salvage a multi billion dollar investment in the drugmaker and recover from his worst year as a fund manager) did not present this year, but was in attendance – in fact he sat in the row directly in front of me.  The group was pretty equally weighted with bulls and bears, in fact several money managers gave one short and one long recommendation.  This year’s lineup was as impressive as it usually is every year.  Whenever a political opinion was given, the belief is that Trump is going to win the Presidency.  Billionaire Stanley Druckenmiller gave a scathing rant on the Federal Reserve, which he claims is using low interest rates to ease borrowing costs and smooth over growing problems in the global economy, namely unproductive investment, particularly in China, an engine of global demand.  Hedge fund guru Zachary Schreiber thinks Saudi Arabia is in trouble and thinks shorting the Saudi Rial is a good bet.  The US dollar will get stronger he believes.  Chamath Palihapitiya, a  refugee to Canada from then war torn Sri Lanka, made his way to Silicon Valley after college and made his fortune at the investment fund he founded; he thinks that Amazon is undervalued and that it could be worth  a $3  trillion valuation.

Squeezed some of the arts in after meetings.  I was lucky enough to get to the theatre one night to see the highly acclaimed drama, Hamilton.  It  is the story of Alexander Hamilton, a penniless Caribbean immigrant who rose to be the U.S.’s first Treasury secretary.  The show has already won a Grammy for best musical theatre album, and multiple Drama Desk awards in 2015, a Pulitzer and appears destined to sweep the Tony’s this year.

It was simply stunning, possibly the best theatre I’ve ever seen.  A pleasant surprise was to see Marissa Mayer seated in the seat behind me.

PHOTOS OF THE DAY

Four dancers from The Australian Ballet dressed in white swan tutus pose for photos on a floating barge in Penrith Lake in Sydney on Friday. The ballet announced today it will perform on an open air stage on the lake in November. Rob Griffith/AP

Members of the Prizma Ensemble, wearing solid-colored bodysuits, take part in the 6th Jane’s Walk, a movement of free, citizen-led walking tours inspired by American urban planner Jane Jacobs, in Jerusalem on Friday. Baz Ratner/Reuters

 

A horse gets a bath after a morning workout at Churchill Downs Friday in Louisville, Ky. The 142nd running of the Kentucky Derby is scheduled for Saturday. Charlie Riedel/AP

Market Closes for May 6^th, 2016

Market Index	Close	Change
Dow Jones	17740.63	+79.92   +0.45%
S&P 500	2057.14	+6.51   +0.32%
NASDAQ	4736.156	+19.062   +0.40%
TSX	13701.47	+69.46
		+0.51%

International Markets

Market Index	Close	Change
NIKKEI	16106.72	-40.66
		-0.25%
HANG SENG	20109.87	-339.95
		-1.66%
SENSEX	25228.50	-33.71
		-0.13%
FTSE 100	6125.70	+8.45
		+0.14%

Bonds

Bonds	% Yield	Previous  % Yield
CND. 10 Year Bond	1.357	1.355
CND. 30 Year Bond	1.990	1.987
U.S.    10 Year Bond	1.7789	1.7383
U.S. 30 Year Bond	2.6276	2.5952

Currencies

BOC Close	Today	Previous
Canadian $	0.77453	0.77798
US $	1.29110	1.28531
Euro Rate 1 Euro=		Inverse
Canadian $	1.47263	0.67906
US $	1.14060	0.87673

Commodities

Gold	Close	Previous
London Gold Fix	1289.00	1280.25
Oil	Close	Previous
WTI Crude Future	44.66	44.32

Market Commentary:

Canada

By Eric Lam

     (Bloomberg) — Canadian stocks rose, paring the first weekly loss in a month, as gold producers jumped after the U.S. added the fewest jobs in seven months and Canada unexpectedly lost jobs due to cutbacks linked to the struggling energy industry.

     The benchmark S&P/TSX Composite Index climbed 0.5 percent to 13,701.47 at 4 p.m. in Toronto, paring its weekly loss to 1.8 percent. The gauge now trades at 20.8 times earnings, about 8.6 percent higher than the 19.1 times earnings valuation of the S&P 500, data compiled by Bloomberg show.

     Canada’s employment declined by 2,100 positions in April, keeping the unemployment rate at 7.1 percent, a reversal from expectations of a 1,000 job increase and a jobless rate of 7.2 percent, according to a survey of economists. The surprise loss in jobs follows a 40,600 gain in March. U.S. employers added 160,000 workers in the month, the fewest in seven months as the jobless rate held steady.

     “While not good news, the moderation in employment in April is far from surprising after the big gain in the prior month,” Doug Porter, chief economist at BMO Financial Group, said in a report, referring to the Canadian labor market data.

     Porter also cut his estimate for Canada’s second-quarter economic growth to zero from 1.5 percent “amid the severe disruptions to oil production due to the Fort McMurray wildfires”. The figure is a placeholder until further information on the impact of the disaster is known, he also said.

     Barrick Gold Corp. and Kinross Gold Corp. rallied more than 3.6 percent to lead raw-materials producers higher.

     Gold prices jumped after the jobs data release, with the disappointing numbers increasing speculation the Federal Reserve will delay raising interest rates. Traders are now pricing in a 8 percent probability of an interest rate hike at the Fed’s June meeting, down from 10 percent before the payrolls data.

     Crude rose 34 cents to settle at $44.66 a barrel in New York, paring its first weekly decline in more than a month. The wildfires ravaging Fort McMurray, Canada’s oil hub in northern Alberta, has rapidly spread to an area almost the size of Hong Kong, forcing more than 80,000 residents to flee and disrupting oil-sands operations in the region.

     Health-care stocks slid with Valeant Pharmaceuticals International Inc. Valeant announced Thursday a committee to oversee the pricing of its drugs after coming under scrutiny for its business practices.

     National Bank of Canada slumped 1.2 percent for a seventh straight loss, its longest slump since December. The lender said Thursday it will set aside C$195 million ($152 million) to cover soured oil-and-gas loans in the second quarter, the second bank to provide an early warning ahead of earnings results later this month.

US

By Anna-Louise Jackson

     (Bloomberg) — U.S. stocks advanced to halt a three-day drop, after the smallest jobs gain in seven months fueled speculation the Federal Reserve will look to raise interest rates gradually.

     The S&P 500 added 0.3 percent to 2,057.14 at 4 p.m. in New York, after falling as much as 0.6 percent. The Dow Jones Industrial Average added 79.92 points to 17,740.63. The S&P 500, which posted its first back-to-back weekly drop since February, climbed higher in afternoon trading after dipping briefly below its 50-day moving average of 2,045.06.

     The Labor Department report today showed American employers added 160,000 workers in April, trailing the 200,000 jobs economists estimated and lower than the revised 208,000 gain in March. The jobless rate, projected to ease, stayed at 5 percent, while wage growth accelerated. 

     The data adds to speculation the Fed will stick with a slower pace in tightening monetary policy. While traders were pricing in a 10 percent chance of higher borrowing costs next month before the jobs report, the odds fell to just 2 percent after. February 2017 is now the first month with an even probability of an increase.

     “The first reaction by the market is people are taking June off the table,” said John Canally, chief economic strategist at LPL Financial in Boston, which oversees about $460 billion. “This report wasn’t a disaster. It wasn’t booming, but it wasn’t awful either. The focus now turns to China with the data coming out over the weekend and next week. The global growth story will either be confirmed or denied.”

     The S&P 500 has retreated 2.2 percent since its high on April 20, halting a rebound that lifted it as much as 15 percent from a February low. Concerns over lackluster corporate earnings and signs of tepid economic growth have provided little incentive for further gains in risky assets.

     “The number this morning was not a good number, coming in well below expectations — but on the other side of it, there’s the question of what it means for policy,” said Kevin Caron, a Florham Park, New Jersey-based market strategist and portfolio manager who helps oversee $180 billion at Stifel Nicolaus & Co. “There’s a push and pull between the real economy and the stimulus response to these changes, and those two things tend to negate one another.”

     Investors are also watching the tail end of the earnings season, with more than 85 percent of S&P 500 companies having already announced. While about 76 percent of the firms that have reported so far beat profit forecasts and 54 percent exceeded sales expectations, analysts are still projecting a 7.4 percent decline in first-quarter earnings.

     Activision Blizzard Inc. jumped 8.5 percent after posting first quarter earnings and sales that topped estimates and boosting its outlook for 2016. Herbalife Ltd. surged 9.1 percent after saying it’s in late-stage talks to resolve a Federal Trade Commission probe into whether the nutrition company is a pyramid scheme.

     Carmakers and raw-material producers advanced, after Morgan Stanley boosted its recommendation on General Motors Co. and a weaker dollar fueled gains in metals prices, sending shares of Freeport-McMoran Inc. higher.

     Last year’s momentum stocks added the most to today’s gains, with Amazon.com Inc., Facebook Inc. and Google’s Alphabet Inc. all advancing. Meanwhile, Apple Inc. fell to its lowest level since June 2014.

     Health-care shares slumped, with Endo International Plc slumping as much as 42 percent after the drugmaker cut its full- year earnings forecast to well below analysts’ predictions in the face of increasing competition.

     Square Inc. plunged 22 percent on concerns about financing for its small-business customer-loan program. GoPro Inc. slid 2.3 percent after saying it sees “modest” growth in the second quarter. Valeant Pharmaceuticals International Inc. dropped 13 percent after saying it’s creating a committee to oversee drug pricing as the company seeks to rest its strategy.

 

Have a wonderful weekend everyone.

 

Be magnificent!

Nonviolence is the law of our species,

just as violence is the law of the beasts.

In the savage man, the spirit is not awake;

he does not know the other law as he knows that of physical force.

Human dignity demands that one refer to a superior law,

which implements the force of the spirit.

Mahatma Gandhi

As ever,

 

Carolann

 

 

People don’t like to follow pessimists.

                    -Bob Iger, b. 1951

 

Carolann Steinhoff, B.Sc., CFP®, CIM, CIWM

Portfolio Manager &

Senior Vice-President

 

Queensbury Securities Inc.,

St. Andrew’s Square,

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7

Dear Friends,

Tangents:

Carolann is out of the office, I will be writing the newsletter on her behalf.

PHOTOS OF THE DAY

A woman walks past street art in Beirut, Lebanon, on Wednesday. Graffiti artists have been trying to engage disillusioned youth in a debate about the country’s latest wave of political turmoil. Hassan Ammar/AP

 

A Bangladeshi street vendor sells coconut on a street in Dhaka, Bangladesh, on Wednesday. A.M. Ahad/AP

Market Closes for May 5^th, 2016

Market Index	Close	Change
Dow Jones	17660.65	+9.39   +0.05%
S&P 500	2049.33	-1.79   -0.09%
NASDAQ	4717.094	-8.546   -0.18%
TSX	13630.42	-1.58
		-0.01%

International Markets

Market Index	Close	Change
NIKKEI	16147.38	-518.67
		-3.11%
HANG SENG	20449.82	-76.01
		-0.37%
SENSEX	25262.21	+160.48
		+0.64%
FTSE 100	6117.25	+5.23
		+0.09%

Bonds

Bonds	% Yield	Previous  % Yield
CND. 10 Year Bond	1.355	1.402
CND. 30 Year Bond	1.987	2.032
U.S.    10 Year Bond	1.7383	1.7717
U.S. 30 Year Bond	2.5952	2.6322

Currencies

BOC Close	Today	Previous
Canadian $	0.77798	0.77674
US $	1.28531	1.28744
Euro Rate 1 Euro=		Inverse
Canadian $	1.46572	0.68226
US $	1.14036	0.87691

Commodities

Gold	Close	Previous
London Gold Fix	1280.25	1283.00
Oil	Close	Previous
WTI Crude Future	44.32	43.78

Market Commentary:

Canada

By Eric Lam

     (Bloomberg) — Canada stocks ended the day where they began, after swinging between gains and losses, as gold miners advanced with the price of the metal while energy producers slipped as a rally in crude faded.

     The benchmark S&P/TSX Composite Index ended at 13,632.01 at 4 p.m. in Toronto, after rising as much as 0.9 percent and falling 0.4 percent. The gauge now trades at 20.7 times earnings, about 8.8 percent higher than the 19.1 times earnings valuation of the S&P 500 Index, data compiled by Bloomberg show. Trading volume was 6.3 percent higher than the 30-day average.

     Six of 10 industries in the S&P/TSX retreated, led by financial services stocks and energy producers. Suncor Energy Inc. retreated 3 percent. Yamana Gold Inc. and Kinross Gold Corp. added at least 4.4 percent as raw-materials producers climbed 1.1 percent as a group.

     National Bank of Canada dropped 0.8 percent, sliding to a month low, after the lender said it will set aside C$195 million ($152 million) to cover soured oil-and-gas loans in the second quarter, joining Canadian Western Bank in providing early warning of rising credit losses tied to energy after the rout in crude prices. National has lost 6.7 percent during a six-day slide, the longest since December. The lender is set to report results June 1.

     Crude futures rose 1.2 percent in New York for a second day of gains, paring an earlier advance. The spreading wildfire in Fort McMurray in northern Alberta has given oil prices a lift as producers have reduced production and opened work camps to fleeing residents. More than 1 million barrels a day of oil sands production capacity may be affected by the blaze, according to company statements and data published in Alberta’s Spring Oil Sands Quarterly.

     The resource-dominant S&P/TSX has stumbled to start the month of May, after a rally of more than 40 percent in the first four months of the year. A rebound in global equities has slowed amid the uncertain outlook for growth and speculation higher interest rates in the U.S. will boost the dollar’s value.

     Manulife, the nation’s largest life insurer, added 1.1 percent as first-quarter profit surged 45 percent after benefiting from interest rate movements and record insurance sales in Asia. Adjusted earnings of 44 cents a share came in ahead of the 43-cent average of analysts surveyed by Bloomberg.

US

By Jeremy Herron and Anna-Louise Jackson

     (Bloomberg) — A rally in crude oil faded and U.S. stocks slipped for a third day, leaving the S&P 500 Index at a three- week low as investors awaited Friday’s jobs report for clues on the strength of the world’s largest economy. Emerging-market shares fell and the dollar strengthened.

     The S&P 500 has fallen 2.5 percent since April 20 amid rising concern global economies haven’t responded to central- bank stimulus. Emerging-market shares dropped to the lowest in seven weeks, and Turkish 10-year bond yields topped 9.5 percent as the prime minister said he was stepping down. Crude advanced as wildfires disrupted production in Canada. Treasuries rose a fourth day, with economists lowering predictions for how high the central bank will be able to lift interest rates.

     Global equities continued their slow slide from recent highs, with a 10-week rally faltering as investors gauge prospects for higher U.S. interest rates amid persistent signs of tepid to slowing growth in major economies. While Fed officials signaled in recent days that rates could rise as soon as June, futures traders assign only a 10 percent probability for such a move as recent data indicated the U.S. economy remains sluggish. The dollar’s rebound from the lowest level in a year weighed on commodities.

     “Sentiment is more negative than I would’ve thought after such a strong rally off that February low,” said Charlie Bilello, director of research at New York-based Pension Partners LLC. “This is a normal kind of digestive period or consolidation after a strong move and ahead of the jobs report tomorrow.” 

     The S&P 500 fell less than 0.1 percent at 4 p.m. in New York. A rally that sent the index up as much as 15 percent from February lost steam after reaching a four-month high on April 20, amid lackluster earnings and lukewarm signs of an economic pickup.

     Retailers slid after L Brands Inc. posted preliminary first-quarter profit that trailed estimates. Utility and telephone stocks retreated, as investors capitulated from a recent preference for companies less tied to growth. Tesla Motors Inc. slumped after UBS Group AG described the electric- car maker’s new production goals as “too optimistic.”

     “There’s still a very cautious feeling to markets,” said William Hobbs, who helps oversee about $150 billion as head of investment strategy at the wealth-management unit of Barclays Plc in London. “The world is growing and is likely to grow a bit quicker as we go through the year and inflation returning and that’s simply not priced in at these levels.”

     The Stoxx Europe 600 climbed 0.3 percent, for the first gain in five days. Trading volume was 16 percent lower than the 30-day average amid holidays in markets including Switzerland, Denmark, Sweden and Finland.

     Emerging-market stocks sank 0.7 percent, with the MSCI Emerging Market Index dropping for a fifth day in the longest slump since December.

     U.S. Treasuries due in a decade rosefor a fourth day. The benchmark 10-year note yield fell three basis points to 1.74 percent, the lowest level in two weeks. Traders are awaiting further insight into the state of the labor market from the monthly payrolls report on Friday.

     Turkish bonds fell, sending 10-year yields to a one-month high, after Prime Minister Ahmet Davutoglu lost a power struggle with President Recep Tayyip Erdogan.

     Currencies of nations that export all kinds of commodities benefited from a jump in oil prices following news of a drop in U.S. production. Australia’s currency vied with its Canadian counterpart to lead gains. The Bloomberg Commodity Index rose for the first time in four days.

     A gauge of the dollar versus 10 major peers extended its advance from its lowest level in a year, capping its biggest three-day rise in six months. The greenback has been supported this week as two regional Fed presidents said that a rate increase should be considered at the central bank’s June gathering.

     West Texas Intermediate crude climbed for a second day, rising 1.2 percent to settle at $44.74 a barrel. Fires in Canada may affect more than 1 million barrels a day of capacity, according to company statements and data published in Alberta’s Spring Oil Sands Quarterly. Brent crude climbed 3.7 percent to $46.26.

     U.S. oil production dropped by 113,000 barrels a day to 8.83 million a day last week, the lowest level since September 2014, data showed Wednesday.

     Gold futures fell for a third straight day, the longest slump in five weeks, as the dollar’s strength damped demand for the metal. Bullion for June delivery slipped 0.2 percent to settle at $1,272.30 an ounce in New York.

 

Have a wonderful evening everyone.

 

Be magnificent!
 

“There is only one happiness in this life, to love and be loved.” George Sand

As ever,

 

Karen
 

“Great works are performed not by strength but by perseverance.” Samuel Johnson

Queensbury Securities Inc.,

St. Andrew’s Square,

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7

Dear Friends,

Tangents:

Carolann is out of the office, I will be writing the newsletter on her behalf.

PHOTOS OF THE DAY

Villarrica Volcano is seen at night in Pucon, Chile, on Tuesday. Cristobal Saavedra/Reuters

A trout splashes into Jamaica Pond in Boston during the annual spring fish stocking event on Wednesday. Elise Amendola/AP

Market Closes for May 4^th, 2016

Market Index	Close	Change
Dow Jones	17651.26	-99.65   -0.56%
S&P 500	2052.36	-11.01   -0.53%
NASDAQ	4725.641	-37.583   -0.79%
TSX	13635.20	-72.48
		-0.53%

International Markets

Market Index	Close	Change
NIKKEI	16147.38	-518.67
		-3.11%
HANG SENG	20525.83	-151.11
		-0.73%
SENSEX	25101.73	-127.97
		-0.51%
FTSE 100	6112.02	-73.57
		-1.19%

Bonds

Bonds	% Yield	Previous  % Yield
CND. 10 Year Bond	1.402	1.460
CND. 30 Year Bond	2.032	2.072
U.S.    10 Year Bond	1.7717	1.7963
U.S. 30 Year Bond	2.6322	2.6593

Currencies

BOC Close	Today	Previous
Canadian $	0.77674	0.78630
US $	1.28744	1.27177
Euro Rate 1 Euro=		Inverse
Canadian $	1.47936	0.67597
US $	1.14907	0.87027

Commodities

Gold	Close	Previous
London Gold Fix	1283.00	1294.00
Oil	Close	Previous
WTI Crude Future	43.78	43.65

Market Commentary:

Canada

By Eric Lam

     (Bloomberg) — Canadian stocks fell to a three-week low as data showing a record trade deficit in March fueled declines in commodity and industrial shares.

     The benchmark S&P/TSX Composite Index dropped 0.6 percent to 13,632 at 4 p.m. in Toronto, capping a third day of losses. The gauge now trades at 20.8 times earnings, about 9.4 percent higher than the 19 times earnings valuation of the S&P 500 Index, data compiled by Bloomberg show.

     Six of 10 main industries in the S&P/TSX declined, led by a 2.4 percent drop in raw-materials shares. Energy producers and industrials also retreated, while telecommunications providers and technology companies advanced to offset some losses.

     The resource-dominant S&P/TSX has sputtered to start the month of May, as commodities producers slumped after a rally of more than 40 percent in the first four months of the year. Global equities have slowed amid the uncertain outlook for growth and speculation higher interest rates in the U.S. will boost the dollar’s value.

     Canada’s trade gap unexpectedly widened to a record C$3.41 billion in March, according to a Statistics Canada report Wednesday, as exports to the U.S. fell 6.3 percent reviving concern a stalling American recovery will derail Canada’s recent rebound. The trade surplus with the U.S. shrank to its narrowest since December 1993, the data showed.

     Materials producers slumped Wednesday as metals from copper to gold retreated. Crude ended the day little-changed, settling below $44 a barrel in New York, after declining 5.2 percent in the previous three sessions. Suncor Energy Inc. has reduced its crude output amid a raging wildfire in Fort McMurray in Alberta, prompting tens of thousands to flee. Suncor shares declined 2.2 percent to a two-month low.

     Bank of Nova Scotia dropped 1.3 percent for a third straight decline, extending losses during that period to 4.9 percent after Canada’s third largest lender said it will post a C$275 million ($214 million) restructuring charge in the second quarter to cover the cost of job cuts and other productivity enhancements as it shifts to digital banking.

     Maple Leaf Foods Inc. jumped 6.8 percent, to a record close, after posting first-quarter earnings ahead of analysts’ estimates as margins improved. Torstar Corp. lost 5.9 percent, the most since March 18, after posting a first-quarter loss amid the challenging print advertising environment.

     Lucara Diamond Corp. surged 9.1 percent to a record after reporting first-quarter earnings ahead of analysts’ estimates Tuesday. The diamond producer may earn as much as 48 percent of the proceeds from the sale of the biggest diamond unearthed in more than a century. That could deliver about $35 million of the $70 million value estimated by Sotheby’s, Chief Executive Officer William Lamb said in an interview with Bloomberg News.

US

By Inyoung Hwang and Joseph Ciolli

     (Bloomberg) — U.S. stocks slid to a three-week low as concern that global growth remains tepid sent equities lower from Europe to developing nations. Oil traded near $44 a barrel, while the dollar strengthened for a second day after falling to its lowest point in almost a year.

     The S&P 500 Index fell for the fourth time in five days, with industrial shares slipping more than 1 percent as a rebound from lows reached in February faltered. Emerging-market equities sank, while the dollar rallied amid speculation on the timing of higher interest rates in the U.S. The Turkish lira plunged with the country’s prime minister said to plan to take the ruling party to an extraordinary congress, intensifying a power struggle within the government. U.S. oil erased declines in a late-in-the-day advance.

     The rally in global equities stumbled into a second week as data from Europe to America failed to alleviate concern that economic growth is slowing and corporate profits will contract. At the same time, comments from Federal Reserve officials have raised the specter key rates will be increased even as economic reports paint a mixed picture on the state of the world’s largest economy. Friday’s monthly payrolls report will be key for investors seeking to determine the Fed’s potential policy path.

     “Data has been a mixed bag today, starting with some disappointing employment figures that gave way slightly to some better-than-expected numbers,” said Chad Morganlander, a Florham Park, New Jersey-based money manager at Stifel, Nicolaus & Co., which oversees about $170 billion. “We expect the market to see some volatility going forward, with a downward bias as investors look for the next positive sign.”

     U.S. reports on Wednesday showed service companies expanded last month at the fastest pace in four months, while fewer jobs were added than projected, according to private payrolls data. A report from Markit Economics indicated that European Central Bank policy is helping to sustain growth in the euro area economy, though the pace is “tepid” and inflation remains too slow.

     The S&P 500 declined 0.6 percent to 2,051.12 as of 4 p.m. New York time to the lowest level since April 11. The U.S. benchmark fell in the last session amid an uninspiring corporate earnings season.

     Bank shares fell a second day, while energy and raw- material producers — the two strongest groups as stocks rebounded from a February low — lagged for a third session. Priceline Group Inc. sank 7.5 percent after its profit forecast disappointed, with executives citing, in part, the “fragility” of the global economy. Investors stuck with a recent preference for defensive shares, as utilities, consumer-staples and phone companies advanced.

     Stan Druckenmiller, the billionaire investor with one of the best long-term track records in money management, said the bull market has “exhausted itself.” Druckenmiller, speaking at the Sohn Investment Conference in New York, said while he’s been critical of Fed policy for the last three years he expected it would lead to higher asset prices.

     “I now feel the weight of the evidence has shifted the other way; higher valuations, three more years of unproductive corporate behavior, limits to further easing and excessive borrowing from the future suggest that the bull market is exhausting itself,” said Druckenmiller.

     Investors are also monitoring the U.S. presidential campaign, with Donald Trump becoming the presumptive Republican nominee after his final two challengers exited the race.

     The Stoxx Europe 600 Index was down 1.1 percent, with all industry groups falling. Anheuser-Busch InBev NV — the world’s largest brewer — slid 1.6 percent after reporting sales and profit growth that missed estimates. BHP Billiton Ltd. tumbled after it was named in a $44 billion law suit over a dam rupture in Brazil that caused deaths and severe environmental damage. 

     The MSCI Emerging Markets Index of stocks fell 0.9 percent to the lowest level in almost a month.

     The Bloomberg Dollar Spot Index, which tracks the greenback against 10 major peers, added 0.5 percent as the currency climbed 0.4 percent to 107.01 yen and was little changed at $1.1487 per euro.

     MSCI’s Emerging Markets Currency Index fell for a third day, sliding 0.6 percent to the lowest level since April 8. The lira extended declines, posting its steepest one-day drop versus the dollar since June, after a person familiar with the matter – – who asked not to be identified citing the sensitivity of the subject — said Prime Minister Ahmet Davutoglu will take the ruling party to an extraordinary congress amid a widening rift over leadership with President Recep Tayyip Erdogan. 

     Turkish assets have slumped on mounting signs of renewed political risk as Erdogan transforms the typically ceremonial role of president to the country’s power center. The Borsa Istanbul 100 Index of stocks dropped for a fourth day in its longest slump in four months.

     Oil rebounded, even after a U.S. government report showed crude inventories rose by 2.78 million barrels. Analysts surveyed ahead of the data release had anticipated a stock build of 750,000 barrels in the week ended April 29. West Texas Intermediaterose 0.3 percent to settle at $43.78 a barrel.

     Gold slid a third day as the dollar’s rebound dimmed the metal’s appeal as an alternative investment. Bullion for immediate delivery retreated 0.5 percent to $1,279.68 an ounce. Copper fell 1.1 percent to $4,867 a metric ton in London, while zinc dropped 0.5 percent.

     U.S. government bonds rose after fluctuating earlier in the session. Yields on 10-year U.S. Treasuries fell two basis points, or 0.02 percentage point, to 1.78 percent. Treasuries have returned 3.2 percent this year as traders back away from bets on Fed monetary policy tightening.

     German government bonds were little changed, with 10-year yields holding at 0.20 percent. Turkish notes fell with yields on debt due in a decade up 10 basis points to 9.33 percent.

 

Have a wonderful evening everyone.

 

Be magnificent!
 

“If your actions inspire others to dream more, learn more, do more and become more, you are a leader.” John Quincy Adams

As ever,

 

Karen
 

“Keep your face to the sunshine and you cannot see a shadow.” Helen Keller

Queensbury Securities Inc.,

St. Andrew’s Square,

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7

Dear Friends,

Tangents:

Carolann is out of the office, I will be writing the newsletter on her behalf.

PHOTOS OF THE DAY

A woman takes photographs of cherry blossoms in Sakura Park in Vilnius, Lithuania, Tuesday. The park opened in 2001 and was dedicated to Japanese diplomat Chiune Sugihara, who was ambassador to Lithuania during WWII. Mindaugas Kulbis/AP

People ride their bicycles by Arpoador beach, near the statue of Brazilian musician Tom Jobim, in Rio de Janeiro Tuesday. Sergio Moraes/Reuters

Market Closes for May 3^rd, 2016

Market Index	Close	Change
Dow Jones	17750.91	-140.25   -0.78%
S&P 500	2063.53	-17.90   -0.86%
NASDAQ	4763.223	-54.372   -1.13%
TSX	13705.55	-160.08
		-1.15%

International Markets

Market Index	Close	Change
NIKKEI	16147.38	-518.67
		-3.11%
HANG SENG	20676.94	-390.11
		-1.85%
SENSEX	25229.70	-207.27
		-0.81%
FTSE 100	6185.59	-56.30
		-0.90%

Bonds

Bonds	% Yield	Previous  % Yield
CND. 10 Year Bond	1.460	1.531
CND. 30 Year Bond	2.072	2.118
U.S.    10 Year Bond	1.7963	1.8635
U.S. 30 Year Bond	2.6593	2.7190

Currencies

BOC Close	Today	Previous
Canadian $	0.78630	0.79809
US $	1.27177	1.25299
Euro Rate 1 Euro=		Inverse
Canadian $	1.46324	0.68342
US $	1.15055	0.86915

Commodities

Gold	Close	Previous
London Gold Fix	1294.00	1285.65
Oil	Close	Previous
WTI Crude Future	43.65	44.78

Market Commentary:

Canada

By Eric Lam

     (Bloomberg) — Canadian stocks fell a second day for the biggest retreat in almost three months, joining a retreat in equities worldwide that was spurred by sluggish economic data.

     The benchmark S&P/TSX Composite Index sank 1.1 percent to 13,707.68 at 4 p.m. in Toronto, posting the steepest drop since Feb. 9. The S&P/TSX advanced for a third consecutive week on April 29 and remains one of the best-performing developed markets in the world this year. The gauge now trades at 21.2 times earnings, about 11 percent higher than the 19.2 times earnings valuation of the Standard & Poor’s 500 Index, data compiled by Bloomberg show.

     Canadian Western Bank, the Edmonton-based lender, sank 6.9 percent for the biggest slide since March 2015 after saying it would take about C$33 million ($26 million) in provisions for soured oil-and-gas loans in the second quarter, prompting one analyst to downgrade the stock. Financial shares contributed the most to the decline today out of 10 S&P/TSX groups.

     Encana Corp. sank 10 percent after reporting a first- quarter loss that was wider than expected, as energy and raw- materials producers each posted a 2 percent drop. Eight of 10 industries in the S&P/TSX fell with trading volume 14 percent higher than the 30-day average.

     Encana said its first-quarter operating loss was 15 cents a share compared with estimates for 12 cents, as cash flow sank 73 percent from the previous quarter. The company blamed the decline in energy prices, lower realized hedging gains, reduced liquids volumes and a one-time restructuring charge.

     Commodities prices from copper to crude fell after data showed a private gauge of Chinese manufacturing slipped in April. A Markit gauge for U.K. manufacturing also showed contraction, unexpectedly shrinking for the first time in three years in April. Stocks fell in the U.S. and Europe, while the dollar rose from a one-year low as Federal Reserve Bank of Atlanta President Dennis Lockhart called a June interest-rate hike “a real option.”

     Crude futures settled below $44 a barrel in New York ahead of weekly U.S. government data forecast to show rising stockpiles. Inventories are forecast to have increased by 750,000 barrels last week, according to the median estimate of a Bloomberg survey ahead of the report Wednesday.

     The resource-dominant S&P/TSX has sputtered to start the month of May, with commodities producers giving back some gains amid the uncertain outlook for global growth and speculation higher interest rates at the Fed will boost the dollar’s value. Raw-materials and energy producers are still the two top- performing industries in Canada so far this year.

US

By Joseph Ciolli and Dani Burger

     (Bloomberg) — U.S. stocks fell, with the S&P 500 sinking to a three-week low, amid rekindled angst over the sluggish pace of global growth and an uninspiring flow of corporate earnings.

     Weaker-than-forecast factory data today in the U.K. and China reminded investors of the worldwide malaise that had a hand in sending equities to their worst-ever start to a year. Commodity shares tumbled, with energy producers falling the most in eight weeks as crude oil retreated, while banks posted the biggest slide since April 7. Apple Inc. snapped its longest losing streak since 1998, and Pfizer Inc. rallied 2.7 percent on earnings that beat estimates and a boosted outlook.

     The S&P 500 declined 0.9 percent to 2,063.37 at 4 p.m. in New York, falling for the third time in four days. The index jumped 0.8 percent to begin the month on Monday in a recovery from the worst weekly drop since February. The Dow Jones Industrial Average lost 140.25 points, or 0.8 percent, to 17,750.91. The Nasdaq Composite Index fell 1.1 percent to seven- week low. About 7.9 billion shares traded hands on U.S. exchanges, in line with the three-month average.

     “The continued narrative is that the global economy is not very strong, even if the U.S. is the best of the bunch,” said Joe Bell, a Cincinnati-based senior equity analyst at Schaeffer’s Investment Research Inc. “We ran into congestion near the 2,100 area. We’ve had such a strong run-up over the last few months that we’re in a bit of a consolidation phase here.”

     A surge sparked by rising oil prices that helped the S&P 500 rebound as much as 15 percent from its February low faltered last week amid lackluster corporate results, scant signs of a pickup in economic growth and waning consumer confidence. The benchmark reached a four-month high on April 20, closing within 1.3 percent of the record set last May, and taking its valuation near a peak.

     With the season past its halfway mark, corporate results have so far failed to suggest a speedy recovery from what’s on track to be a fourth straight quarterly decline. Apple Inc., Microsoft Corp. and Alphabet Inc. all forecast sales in coming periods below analyst estimates, sinking large-cap technology shares even as Facebook Inc. and Amazon surpassed forecasts. Banks, however, used cost cuts to top predictions, helping financial shares post the second-strongest performance behind energy producers since the reporting period began.

     Analysts still project an 8.2 percent decline in first- quarter earnings for S&P 500 companies. Predictions call for a 4.8 percent drop in the current quarter, compared to forecasts for 3.7 percent growth when the year started.

     Economic releases are also in focus after the Federal Reserve kept its benchmark rate unchanged last week, and manufacturing data disappointed yesterday. A report on employment due Friday will be closely watched, as investors seek assurances on the stability of job growth which has been a source of strength in an otherwise tepid environment.

     Traders are now pricing in a 55 percent chance of higher borrowing costs in December, the first month with more than even odds for a boost. Fed Bank of Atlanta President Dennis Lockhart said today U.S. financial markets may be underestimating the odds of a central-bank rate increase in June, calling it “a real option.” Current bets show just a 12 percent chance the Fed will raise borrowing costs next month.

     In Tuesday’s trading, all of the S&P 500’s 10 main industries declined, with energy, financial and raw-materials companies — the strongest performers during the market’s 10- week rebound to a 2016 high — sliding at least 1.3 percent. Consumer staples and utilities, the biggest laggards during the rally were little changed.

     “Things had calmed down for the U.S. in March and April and now we’re in a mode where the market can’t make up its mind and is slipping back and forth,” said Peter Jankovskis, who helps oversee $1.9 billion as co-chief investment officer of Lisle, Illinois-based OakBrook Investments. “The weakening in energy is realistic. I’m not sure what’s supporting the price of crude at these levels, because it was driven up by rumors that the meeting at OPEC would lead to production quotas, and that fell apart.”

     The CBOE Volatility Index climbed 6.3 percent to 15.60, trimming a jump of almost 12 percent. The measure of market turbulence known as the VIX rose 13 percent in April, the biggest monthly gain of 2016.

     Energy companies in the benchmark decreased 2.2 percent, the worst since March 8, as the price of oil fell 2.5 percent before weekly data forecast to show rising crude stockpiles. Chesapeake Energy Corp. and Southwestern Energy Co. were the biggest losers, declining at least 6.8 percent, while Marathon Oil Corp. fell 5.6 percent. Halliburton Co. sank the most since February after reporting results that included charges related to the failed $28 billion merger with Baker Hughes Inc.

     The S&P 500 Financials Index lost 1.3 percent, reversing a 1.1 percent rally on Monday. Asset managers Legg Mason Inc. and Affiliated Managers Group Inc. decreased at least 3.2 percent. The KBW Bank Index slid 2 percent, its third decline in four days and the biggest drop since April 7. All 24 companies in the gauge fell more than 1 percent. JPMorgan Chase & Co. dropped 1.9 percent, one of the biggest drags on the S&P 500.

     General Motors Co. and Ford Motor Co. dropped more than 1.4 percent after their April sales missed estimates. The two pared earlier declines of more than 3 percent. Goodyear Tire & Rubber Co. lost 1.2 percent.

     FMC Corp. was the biggest gainers in the S&P 500 and a bright spot in raw-materials, rising 8.5 percent after reporting profit and revenue that exceeded analyst expectations. The pesticide company also increased guidance for full-year earnings. Meanwhile, Freeport-McMoRan Inc. tumbled more than 11 percent, the steepest in eight weeks, as copper slumped on concern demand for metals is weakening following sluggish manufacturing data around the world. Alcoa Inc. fell 5.6 percent.

     IMS Health Holdings Inc. announced that it will buy Quintiles Transnational Holdings Inc. in an all-stock transaction with an equity value of about $9 billion, bringing together two of the biggest providers of pharmaceutical industry data. IMS Health slipped 3.5 percent, while Quintiles fell 2.4 percent.

     Among other shares moving on corporate news, Mallinckrodt Plc surged 6.8 percent, combining with Pfizer’s gain to help the health-care group mitigate its losses. The drugmaker lifted its 2016 profit outlook as quarterly results exceeded estimates.

     Clorox Co. added 2 percent and briefly touched an all-time high after raising its full-year earnings and sales forecasts following results that beat analysts’ predictions. CVS Health Corp.’s quarterly profit also topped estimates, sending its shares up 2.4 percent, helped by higher prescription claims and the acquisition of a nursing-home pharmacy business.

 

Have a wonderful evening everyone.

 

Be magnificent!

 

“The best preparation for tomorrow is doing your best today.” H. Jackson Brown, Jr.

As ever,

 

Karen

 “Try to be a rainbow in someone’s cloud.” Maya Angelou

 

Queensbury Securities Inc.,

St. Andrew’s Square,

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7

Dear Friends,

Tangents:

Carolann is out of the office, I will be writing the newsletter on her behalf.

PHOTOS OF THE DAY

A participant takes part in the annual Jack In The Green parade involving hundreds of costumed revellers joining a four hour procession culminating in the traditional ‘slaying’ of a Jack character to ‘unleash the spirit of summer’ on the May Day week end, in Hastings, southern Britain on Monday.Toby Melville/Reuters

A bus passes by a canola field in Sehnde near Hannover, northern Germany, on Monday morning. Julian Stratenschulte/AP

Market Closes for May 2^nd, 2016

Market Index	Close	Change
Dow Jones	17891.16	+117.52   +0.66%
S&P 500	2081.43	+16.13   +0.78%
NASDAQ	4817.594	+42.432   +0.88%
TSX	13869.49	-81.96
		-0.59%

International Markets

Market Index	Close	Change
NIKKEI	16147.38	-518.67
		-3.11%
HANG SENG	21067.05	-320.98
		-1.50%
SENSEX	25436.97	-169.65
		-0.66%
FTSE 100	6241.89	-80.51
		-1.27%

Bonds

Bonds	% Yield	Previous  % Yield
CND. 10 Year Bond	1.531	1.513
CND. 30 Year Bond	2.118	2.084
U.S.    10 Year Bond	1.8635	1.8333
U.S. 30 Year Bond	2.7190	2.6781

Currencies

BOC Close	Today	Previous
Canadian $	0.79809	0.79656
US $	1.25299	1.25540
Euro Rate 1 Euro=		Inverse
Canadian $	1.44464	0.69222
US $	1.15295	0.86734

Commodities

Gold	Close	Previous
London Gold Fix	1285.65	1285.65
Oil	Close	Previous
WTI Crude Future	44.78	45.92

Market Commentary:

Canada

By Eric Lam

     (Bloomberg) — Canadian stocks fell in the first trading session of May, after capping a third monthly gain, as commodities producers declined with oil and Bank of Nova Scotia slipped after reporting a C$275 million restructuring charge.

     The benchmark S&P/TSX Composite Index sank 0.6 percent to 13,865.63 at 4 p.m. in Toronto. The gauge increased 3.4 percent in April, matching the longest monthly winning streak since August 2014. The S&P/TSX is one of the best-performing developed markets in the world this year, up 6.6 percent as it rebounds from last year’s worst annual decline since 2008.

     Suncor Energy Inc. and Cenovus Energy Inc. fell at least 3.1 percent to lead energy producers lower as the group declined 2 percent. Four of 10 industries in the S&P/TSX retreated on trading volume in line with the 30-day average. Raw-materials, financial services and health-care companies also decreased, while consumer staples and utilities rose more than 0.8 percent.

     Goldcorp Inc. dropped 3.2 percent as raw-materials producers tumbled 1.6 percent. Gold was little changed in New York while copper prices sagged for the first time in three sessions as growth in U.S. manufacturing cooled in April. A gauge of S&P/TSX gold producers slumped 1.9 percent to snap a four-day rally of 15 percent.

     Crude futures settled below $45 a barrel in New York, extending a slide from Friday. Exports from Iraq approached a record in April, shipping 3.36 million barrels a day in the month to add to a worldwide supply glut, according to an oil ministry spokesman. The figures don’t include sales by the Kurdistan Regional Government.

     The resource-dominant S&P/TSX remains closely linked to moves in commodities prices, with a 17 percent rally in the benchmark equity gauge from a Jan. 20 low aligning with a rebound in crude from the lowest levels since 2003. Raw- materials and energy producers are the two top-performing industries in Canada so far this year, up more than 11 percent.

     The Canadian benchmark now trades at 21.5 times earnings, about 11 percent higher than the 19.3 times earnings valuation of the Standard & Poor’s 500 Index, according to data compiled by Bloomberg.

     Scotiabank lost 1 percent after reporting it will take a charge of 22 cents a share in its fiscal second quarter, to cover the cost of job cuts and other productivity enhancements as it shifts toward digital banking. The lender is scheduled to report results May 31.

     Manitoba Telecom Services Inc. climbed a record 15 percent to the highest since 2008, after agreeing to sell itself to BCE Inc. in a C$3.1 billion cash and stock deal. Manitoba Telecom traded at a lower value than the C$40 a share acquisition price. As a follow-on to the deal, BCE will also transfer one-third of Manitoba Telecom’s wireless subscribers to competitor Telus Corp. BCE fell 0.3 percent while Telus gained 0.2 percent.

     Valeant Pharmaceuticals International Inc. lost 2.3 percent, paring earlier declines of as much as 13 percent, for a third drop in the last four sessions. Warren Buffett criticized Valeant at Berkshire Hathaway Inc.’s annual meeting, calling the drugmaker’s business model “enormously flawed.”

US

By Jeremy Herron and Joseph Ciolli

     (Bloomberg) — U.S. shares rose the most in two weeks and the dollar weakened to the lowest in almost a year as traders lowered expectations for higher interest rates as manufacturing slowed last month. Emerging-market assets retreated with crude.

     The S&P 500 advanced as consumer and financial shares paced gains amid corporate results. The euro topped $1.15 for the first time since August, while gold pared an advance after climbing above $1,300 an ounce for the first time since January 2015. Oil fell below $45 a barrel in New York, after a 20 percent surge in April. Brazil’s real led losses among its major peers. The Treasury 10-year yield rose to 1.85 percent.

     Global equities advanced on the first day of May, following a week that saw risk assets fall from favor amid speculation central banks from Asia to Europe won’t rush to add to unprecedented stimulus. The Federal Reserve struck a more hawkish tone with its policy statement even as signs mount that the rate of U.S. growth continues to slow. A weakening dollar helped boost commodities prices to the best month since 2010.

     “We can hold the strength, but there’s still a lack of conviction in the market,” said Bill Schultz, who oversees $1.2 billion as chief investment officer at McQueen, Ball & Associates Inc. in Bethlehem, Pennsylvania. “Earnings have been spotty at best, and outlooks have given investors some pause about the future. At the same time, there are no signs pointing to a dramatic pullback.”

     U.S. manufacturing expanded at a slower pace than forecast in April as factories continued to grapple with lax global demand and fallout from a weakened energy industry. China released an official manufacturing gauge over the weekend that added to evidence its economy is stabilizing, while manufacturing in the euro zone expanded at a faster pace than initially estimated in April. Markets shut for holidays included those of China, Hong Kong and the U.K.

     The S&P 500 advanced 0.8 percent at 4 p.m. in New York, for its best gain since April 13. Amazon.com Inc. rose to a four- month high after earnings last week led to its biggest one-day gain in nine months. Wells Fargo & Co. and JPMorgan Chase & Co. climbed at least 1.1 percent. Halliburton Co. rallied 3.3 percent and Baker Hughes Inc. fell 1.6 percent after ditching their $28 billion merger. Apple Inc. extended its longest losing streak since 1998.

     A rebound that lifted S&P 500 as much as 15 percent from its February low faltered last week amid lackluster earnings and few signs of a pickup in economic growth. The gauge reached a four-month high on April 20, within 1.3 percent of the record set last May.

     Corporate results so far haven’t convinced investors that profits will rebound from what’s shaping up to be a fourth straight quarterly decline. Apple, Microsoft Corp. and Alphabet Inc. all forecast sales in coming periods below analyst estimates, sinking large-cap technology shares even as Facebook Inc. and Amazon.com Inc. have surpassed forecasts. Not all has been bad, as banks used cost cuts to top predictions. Financial shares advanced 0.9 percent Monday.

     The MSCI Emerging Markets Index fell 0.5 percent, following two weeks of losses that pared its April gains. South Korea’s Kospi Index dropped for a fourth day and Indonesia Jakarta Composite Index slid to a three-week low, tracking losses in Japanese equities.

     The yen has strengthened 13 percent this year, the best performance among Group-of-10 currencies. The euro advanced 0.6 percent to $1.1517, the highest since Aug. 25.

     The Bloomberg Dollar Spot Index, which tracks the greenback against 10 major peers, headed for its lowest close in almost a year. It slumped 2 percent last week as the BOJ’s inaction coincided with Fed Chair Janet Yellen reiterating she’s in no rush to cool the U.S. economy by raising borrowing costs.

     “So long as the Fed signals that they are being cautious in raising rates, real yields in the U.S. will decline, leading the dollar weaker,” said Hiromichi Shirakawa, the Swiss lender’s chief Japan economist and a former BOJ official. “The currency market is in a rather dangerous zone.”

     Gold futures climbed as much as 1.1 percent to $1,304.30 an ounce, the highest since January 2015, before settling at $1,295.80.

     Brent oil retreated 1.7 percent, following a 22 percent surge in April, as near-record Iraqi output added barrels to a worldwide supply glut. Gold climbed for a sixth day, the longest streak since March 2015. Brent crude fell to $46.53 a barrel.

     The London Metal Exchange is shut Monday.

     Treasury 10-year yields rose 2 basis points to 1.86 percent as trading resumed in New York after being closed for the London morning. The yield dropped five basis points last week. Puerto Rico, a U.S. territory, said Sunday that it will default on a $422 million bond payment for its Government Development Bank.

     Canadian government bonds ended their worst month in a year as investors switched bets to central bank interest-rate increases from cuts on signs of economic strength and a crude- oil rally.

     German’s 10-year bond yield fell one basis points to 0.27 percent, after three weeks of increases that pushed it to as high as 0.31 percent on April 27, the most in more than a month.

 

Have a wonderful evening everyone.

 

Be magnificent!

 

“Very little is needed to make a happy life; it is all within yourself, in your way of thinking.” Marcus Aurelius

 

As ever,

 

Karen

 

“The purpose of our lives is to be happy.” Dalai Lama

 

Queensbury Securities Inc.,

St. Andrew’s Square,

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7

Dear Friends,

Tangents:

May:

The Anglo-Saxons called this month thrimilce, because then cows can be milked three times a day.  The present name is the Latin Maius, probably from Maia, the goddess of growth and increase, connected with major.  It was the fifth month in the Julian and Gregorian calendars.  The old Dutch name was Bloumaand, “blossoming month.”  The corresponding month in the French revolutionary calendar was Floréal, “floral”, with a period from modern April 21 to May 20^th. 

May Day:  Polydore Virgil says that the Roman youths used to go into the fields and spend the calends of May in dancing and singing in honor of Flora, goddess of fruits and flowers.  The English celebrated May Day with games and sports, particularly archery and Morris Dances and the setting up of the Maypole.  In due time, Robin Hood and Maid Marian came to preside as Lord and Lady of the May, and by the 16^th century May Day was Robin Hood’s day and Robin Hood plays  became an integral part of the festivities.

May Day was also formerly the day of the London chimney-sweepers’ festival.

HAPPY MAY DAY EVERYONE!

FYI:  I am off to Toronto to visit with clients on Monday and then on to an investment conference in NYC for a couple of days, but I shall be continuously in touch with the office.   Therefore, you can leave a  message with my assistants if you need anything; they will make sure I get the message so I can reply to you at the first opportunity.

PHOTOS OF THE DAY

Two women walk their dogs near a field of rape in Frankfurt, Germany on Friday. Michael Probst/AP

A man paddles on Lake Geneva on a warm spring afternoon in Lausanne, Switzerland, on Friday. Denis Balibouse/Reuters

Market Closes for April 29^th, 2016

Market Index	Close	Change
Dow Jones	17773.64	-57.12   -0.32%
S&P 500	2065.30	-10.51   -0.51%
NASDAQ	4775.359	-29.931   -0.62%
TSX	13951.45	+65.02
		+0.47%

International Markets

Market Index	Close	Change
NIKKEI	16666.05	-624.44
		-3.61%
HANG SENG	21067.05	-320.98
		-1.50%
SENSEX	25606.62	+3.52
		+0.01%
FTSE 100	6241.89	-80.51
		-1.27%

Bonds

Bonds	% Yield	Previous  % Yield
CND. 10 Year Bond	1.513	1.479
CND. 30 Year Bond	2.084	2.057
U.S.    10 Year Bond	1.8333	1.8260
U.S. 30 Year Bond	2.6781	2.6843

Currencies

BOC Close	Today	Previous
Canadian $	0.79656	0.79661
US $	1.25540	1.25533
Euro Rate 1 Euro=		Inverse
Canadian $	1.43772	0.69554
US $	1.14514	0.87326

Commodities

Gold	Close	Previous
London Gold Fix	1285.65	1256.00
Oil	Close	Previous
WTI Crude Future	45.92	46.03

Market Commentary:

Canada

By Eric Lam

     (Bloomberg) — Canadian stocks advanced, capping a third straight monthly gain, as raw-materials rallied on First Quantum Minerals Ltd.’s earnings and the nation’s economy contracted less than expected in February.

     The benchmark S&P/TSX Composite Index rose 0.5 percent to 13,951.45 at 4 p.m. in Toronto. The gauge increased 3.4 percent in April, matching the longest monthly winning streak since August 2014. It also added 0.6 percent in the last five days, to extend the longest stretch of weekly gains since the year began. The S&P/TSX is one of the best-performing developed markets in the world this year as it rebounds from last year’s worst annual decline since 2008.

     Canada’s gross domestic product declined 0.1 percent in February, smaller than the median 0.2 percent estimate in a Bloomberg survey of economists. The decline is the first in five months, a rare setback in a quarter economists expect will actually show the best expansion in more than a year. Statistics Canada kept in place its January growth estimate of 0.6 percent, the fastest since 2013.

     Raw-materials shares surged 5.4 percent to the highest level in more than a year, one of only three groups in the S&P/TSX to climb Friday. Trading volume was 37 percent higher than the 30-day average in April’s final trading session.

     First Quantum jumped 17 percent, climbing to the highest close since July, after reporting first-quarter earnings and revenue ahead of analysts’ estimates. The results reflect higher copper, nickel and zinc output from continuing operations, including the new Sentinel mine, according to Eily Ong, a Bloomberg Intelligence analyst.

     Enbridge Inc. and Crescent Point Energy Ltd. fell more than 0.8 percent as energy stocks slipped 0.1 percent, paring a second monthly advance. Oil dropped from a five-month high in New York as OPEC crude production surged by 484,000 barrels a day in April, the most in monthly data going back to 1989. Oil still rose 20 percent this month for the biggest such advance in a year as U.S. production slumped to the lowest level since October 2014.

     The resource-dominant S&P/TSX remains closely linked to moves in commodities prices, with an 18 percent rally in the benchmark equity gauge from a Jan. 20 low aligning with a rebound in crude from the lowest levels since 2003. Raw- materials and energy producers are the two top-performing industries in Canada so far this year, up more than 14 percent.

     The Canadian benchmark now trades at 21.7 times earnings, about 14 percent higher than the 19 times earnings valuation of the Standard & Poor’s 500 Index, according to data compiled by Bloomberg.

     Air Canada soared 13 percent, the most in two years, as the airline reported an unexpected first-quarter profit, benefiting from falling fuel prices and rising traffic.

     Valeant Pharmaceuticals International Inc. dropped 5.5 percent after filing its delayed 2015 annual report and saying it may make significant changes to its business strategy. Neither outgoing Chief Executive Officer Mike Pearson nor former Chief Financial Officer Howard Schiller will stand for re- election and five independent directors have also told the board they will not run again.

US

By Jeremy Herron and Joseph Ciolli

     (Bloomberg) — The dollar fellto the lowest level in almost a year on speculation the Federal Reserve won’t rush to raise interest rates. U.S. stocks fell and commoditiesextended gains in their best month since 2010.

     The Bloomberg Dollar Spot Index fell for third month, the longest since it started a two-year rally of 20 percent, while the yen had its biggest weekly jump since 2008. Declines in the greenback are proving a boon for raw materials, helping lift gold and silver to 15-month highs. Crude oiljumped 20 percent this month to $46 a barrel in New York. U.S. stocks staged an afternoon comeback to pare a decline and end April slightly higher.

     The dollar’s drop comes as personal spending in the U.S. last month reinforced speculation on the pace of Fed tightening as the world’s largest economy struggles to gain traction. The rally in equities spurred by stabilization in the price of crude and the potential for central-bank support has stalled in recent weeks. Corporate results have been mixed, with profits at S&P 500 companies set for a fourth straight quarterly contraction.

     “With the inactivity and ineffectiveness progressively for central bank policy, there’s still certainly a lot of hand- wringing to be done,” said Mike Moran, head of economic research for the Americas at Standard Chartered Bank. “It underscores the issue — we’re not in a very strong growth environment globally.”

     The Bloomberg dollar gauge, which tracks the greenback against 10 major peers, slipped 0.6 percent as of 4 p.m. in New York, capping a 2 percent weekly loss and third straight monthly slide.

     Consumer spending rose less than forecast in March, wrapping up the weakest quarter in a year for the biggest part of the U.S. economy even as incomes accelerated. A tempering of household purchases for the last three quarters has surprised economists given the favorable backdrop of low inflation, job gains and cheap borrowing costs.

     The yen strengthened against all 16 major peers for the second day in a row, climbing as much as 1.1 percent to 106.91 a dollar, the strongest level since October 2014. It surged 5.1 percent this week as the Bank of Japan defied economists’ expectations that stimulus would be stepped up.

     Emerging-market currencies rose for a third month advance as oil rallied. The MSCI Emerging Markets Currency Index touched the highest level since July on Friday. The ruble extended the best start to a year on record as Russia’s central bank left borrowing costs on hold. Colombia’s peso rose 0.7 percent, pushing its gain in April to 5.1 percent. South Africa’s rand advanced 0.4 percent, extending a monthly gain to 3.7 percent. The Brazilian real strengthened 4.4 percent in April.

          The S&P 500 Index fell 0.6 percent to 2,065.50, the lowest in two weeks. It’s fallen 1.4 percent in two days, the most since Feb. 9. The gauge lost 1.3 percent in the week, paring a monthly gain to 0.3 percent. It’s now fallen 1.7 percent since April 20, when it closed at 2,102.40 and was within 1 percent of an all-time high.

     “A lot of optimism came into the market last week as we crossed 2,100, which makes it vulnerable to a short-term pullback,” said Bruce Bittles, chief investment strategist at Milwaukee-based Robert W. Baird, which oversees $110 billion. “The market is being supported by very favorable monetary policy, but valuations are very stretched and earnings aren’t coming through.”

     Amazon.com Inc. surged as it reported sales and profit that topped estimates. Chevron Corp. fell after reporting a wider- than-estimated loss. Gilead Sciences Inc. retreated as its profit missed estimates on lower-than-expected sales of its hepatitis C treatments.

     The Stoxx Europe 600 Index fell 2.1 percent, for its biggest drop since Feb. 24 and paring its monthly increase to 1.2 percent. All its industry groups declined Friday.

     The MSCI Emerging Markets Index dropped 0.6 percent, trimming this month’s advance to 0.3 percent. The gauge has climbed 5.7 percent this year, compared with a 1 percent gain in the MSCI World Index of developed markets.

     The global gluts that have plagued markets from crude oil to zinc are finally starting to subside, sending commodities to their biggest monthly gain since December 2010. The Bloomberg Commodity Index, a measure of returns on 22 raw materials, rose 0.8 percent, extending this month’s gain to 8.5 percent.

     Oil dropped Friday from a five-month high as surging OPEC crude production is seen swelling global stockpiles. Futures settled at $45.92 a barrel in New York. WTI is up 20 percent this month, the most in a year, rebounding after slumping to the lowest since 2003 earlier this year. 

     Base metals rallied, with aluminum set for its biggest monthly advance since 2012 amid signs of improved demand in China, the world’s biggest consumer. Raw materials have recovered as China’s property and construction industry rebounded after a slow start to the year. Copper, zinc, lead and nickel climbed at least 1 percent.

     Gold and silver rose, both closing at the highest since January 2015.

     The Bloomberg U.S. Treasury Index declined 0.3 percent in April, set for the first monthly loss of 2016. The 10-year yield was little changed at 1.83 percent on Friday, having started the month at 1.77 percent. Similar-maturity bonds in Japan yielded minus 0.085 percent at the end of their final trading session in April.

     The 10-year break-even rate, which measures the difference between yields on 10-year notes and equivalent Treasury Inflation-Protected Securities, widened for a 10th day. The gauge of the expected annual inflation pace over the next decade climbed to 1.73 percentage points, the highest since July.

     Government bonds from Germany to Spain and Italy capped monthly declines amid signs of optimism about the regional and global economy, with data Friday showing euro-zone economic growth quickened more than analysts predicted in the first quarter. German 10-year bund yields rose two basis points to 0.27 percent, leaving them 12 basis points higher in the month.

 

Have a wonderful weekend everyone.

 

Be magnificent!

The sum-total of the experience of the sages of the world is available to us

and would be for all time to come.

Moreover, there are not many fundamental truths,

but there is only one fundamental truth which is Truth itself,

otherwise known as nonviolence.

Mahatma Gandhi

 

As ever,

 

Carolann

 

Enthusiasm is the most important thing in life.

                  –Tennessee Williams, 1911-1983

Carolann Steinhoff, B.Sc., CFP®, CIM, CIWM

Portfolio Manager &

Senior Vice-President

 

Queensbury Securities Inc.,

St. Andrew’s Square,

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7