Month: June 2016

Dear Friends,

Tangents:

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

PHOTO OF THE DAY
Portugal fans cheer before their soccer match against Portugal in the EURO 2016 quarter finals at Stade Vélodrome in Marseille, France, on Thursday. Christian Hartmann/Reuters

Market Closes for June 30^th, 2016

Market Index	Close	Change
Dow Jones	17929.99	+235.31   +1.33%
S&P 500	2098.86	+28.09   +1.36%
NASDAQ	4842.672	+63.426   +1.33%
TSX	14064.54	+27.80
		+0.20%

International Markets

Market Index	Close	Change
NIKKEI	15575.92	+9.09
		+0.06%
HANG SENG	20794.37	+358.25
		+1.75%
SENSEX	26999.72	+259.33
		+0.97%
FTSE 100	6504.33	+144.27
		+2.27%

Bonds

Bonds	% Yield	Previous  % Yield
CND. 10 Year Bond	1.060	1.121
CND. 30 Year Bond	1.715	1.759
U.S.    10 Year Bond	1.4765	1.5070
U.S. 30 Year Bond	2.2911	2.3130

Currencies

BOC Close	Today	Previous
Canadian $	0.77212	0.77313
US $	1.29514	1.29344
Euro Rate 1 Euro=		Inverse
Canadian $	1.43803	0.69540
US $	1.11033	0.90087

Commodities

Gold	Close	Previous
London Gold Fix	1320.75	1321.50
Oil	Close	Previous
WTI Crude Future	48.33	49.51

Market Commentary:

Canada

By Eric Lam

     (Bloomberg) — Canadian stocks rose a third day, capping the best quarterly gain in two years, as turmoil in global markets eased after a tumultuous four days following the U.K. vote to leave the European Union.

     The S&P/TSX Composite Index rose 0.2 percent to 14,064.54 at 4 p.m. in Toronto, reversing an earlier loss of as much as 0.5 percent. The S&P/TSX ended flat for the month of June and higher by 4.2 percent in the second quarter. Canadian markets will be closed Friday for the Canada Day holiday. Trading volume was about 6 percent higher than the 30-day average.

     Raw-materials producers gained 1.1 percent as seven of 10 industries in the S&P/TSX rose. Potash Corp. of Saskatchewan Inc. rallied as much as 6.6 percent before paring gains, amid speculation of a possible takeover. Shares closed 0.9 percent higher. Lucara Diamond Corp. rebounded 3.9 percent after slumping the most in four years Wednesday when its massive 1,109-carat diamond failed to sell at auction in London.

     Global stocks jumped after Bank of England Governor Mark Carney said the central bank will probably have to loosen policy within months to deal with the fallout of the Brexit vote. Boris Johnson, the high-profile “Leave” Brexit campaigner and former mayor of London, surprised observers earlier by dropping out of the race to replace U.K. Prime Minister David Cameron, casting more uncertainty on a volatile political situation in the country.

     Meanwhile, Bank of Nova Scotia and Canadian Imperial Bank of Commerce slipped at least 0.9 percent as financial services stocks slipped 0.2 percent.

     The Canadian benchmark has swung wildly along with global markets in the last week, posting its biggest two-day slump since February following the Brexit vote, then rallying the most since February in the following two days. The S&P/TSX trails New Zealand as the top-performing developed market in the world in 2016, according to data compiled by Bloomberg. 

     Canada’s economy eked out a 0.1 percent advance in April, the first increase in three months, as the real estate boom in Toronto and Vancouver and robust consumer spending offset weakness in oil production, at least for a month. Output grew 0.1 percent, Statistics Canada said Thursday in Ottawa, matching the median forecast in a Bloomberg survey of economists. The increase follows declines of 0.2 percent in March and 0.1 percent in February.

     Health-care stocks have led declines in the gauge this month with a 21 percent slide, led by struggling drugmakers Valeant Pharmaceuticals International Inc. and Concordia International Corp. Technology shares followed with a 7.1- percent drop.

     Raw-materials producers have led the charge for Canada with a 51 percent gain this year, the best year-to-date performance for the industry in at least 30 years, according to data compiled by Bloomberg. Gold prices are on track for the biggest annual increase since 2010.

     The gains in commodity stocks have helped Canadian shares retain their more expensive relative to U.S. peers. The S&P/TSX trades at 21.6 times earnings, about 11 percent higher than the multiple of the S&P 500.

US

By Dani Burger and Joseph Ciolli

     (Bloomberg) — U.S. stocks climbed, with the S&P 500 Index capping a third consecutive quarterly advance, as policy makers signaled further steps to buffer the impact of Britain’s decision to leave the European Union.

     Equities ended the quarter with the biggest three-day rally since February after the Brexit vote nearly derailed gains. The benchmark index climbed within 1 percent of its all-time high headed into the referendum amid signs global growth had stabilized and central banks would remain supportive. Energy producers led the advance in the period, rising nearly 11 percent as crude had its best quarter since 2009. The health- care group rose 5.8 percent, reversing most of a 5.9 percent in the first quarter.

     The S&P 500 climbed 1.4 percent to 2,098.86 at 4 p.m. in New York, on top of a 3.5 percent rebound in the previous two sessions. The gauge finished the quarter up 1.9 percent and erased a June decline in the final minute of trading, rising 0.1 percent for the month. The Dow Jones Industrial Average increased 235.31 points, or 1.3 percent, to 17,929.99. The Nasdaq Composite Index added 1.3 percent. About 8.8 billion shares traded hands on U.S. exchanges, 22 percent above the three-month average.

     Gains today were boosted after word the European Central Bank is considering loosening the rules for bond purchases in its stimulus program, to ensure enough debt is available to buy in the aftermath of the Brexit vote. Bank of England Governor Mark Carney also said the BOE will probably have to loosen policy within months to deal with the fallout, though he warned there’s only so much he can do to protect the economy.

     “There’s no doubt that central bankers are helping to underpin this market and take some of the risk out,” said Quincy Krosby, a market strategist at Prudential Financial Inc., which oversees about $1.2 trillion. “This is a commitment from central banks to keep the liquidity flowing into the market, and that’s crucial. Nonetheless, you’ve got to respect the fact that it’s the end of the quarter and half year, and rebalancing is taking place.”

     A global rally lifted equities in the prior two days, returning the S&P 500 to an annual advance, as central banks reassured investors that they’re ready to increase stimulus after the U.K.’s vote. The outcome of the referendum had sparked a two-day selloff, the worst for the benchmark in 10 months, that wiped as much as $3.6 trillion from stocks worldwide.

     The CBOE Volatility Index saw its fourth-straight decline today, the longest in a month, pushing the measure of market turbulence known as the VIXto a three-week low. Still, investors remain on alert with Britain in limbo as its leaders fight to see who will succeed David Cameron as prime minister, preventing the country from entering talks to determine its future relationship with the EU.

     Consumer staples shares led a third day of gains, bolstered by a 17 percent surge in Hershey Co. after a report Mondelez International Inc. made a takeover bid for the chocolate maker. Utilities increased for a sixth day, the longest since March, with investors tilting toward defensive assets even after the strongest two-day climb in four months. Phone companies rose to the highest level since 2001.

     “The majority of U.S. investors are of the belief that the selloff in U.S. markets post-Brexit was a little bit overdone,” said Michael James, managing director of equity trading at Wedbush Securities Inc. in Los Angeles. “You had positive stress test reports with raised buybacks and dividends from the majority of money center banks last night, which has added to overall positive sentiment. Any time there’s M&A, those types of transactions provide positive sentiment for the market overall.”

     While the turmoil interrupted the S&P 500’s march to an all-time high — a move propelled by optimism over a combination of low rates and moderate growth — it has also prompted traders to push back bets the Federal Reserve will raise borrowing costs any time soon. They now indicate a rate boost is unlikely before 2018.

     The S&P 500 is 0.7 percent below its June 23 level after the rebound from a 5.3 percent two-day selloff. The gauge erased its June decline to finish little changed after coming within 1 percent of a record twice this month. While the index rose 1.9 percent in the quarter, analysts forecast S&P 500 companies will report a 5.3 percent drop in earnings for the period, a fifth straight decline.

     Exxon Mobil Corp. and Chevron Corp. have bolstered energy shares in the benchmark since the end of March, with the two rising at least 9.8 percent on the way to a third quarterly gain, the longest since 2011. Exxon Mobil reached an 18-month high on Thursday.

     Meanwhile, technology companies were the S&P 500’s worst performers in the second quarter, dragged down by declines in heavyweights Microsoft Corp., Apple Inc. and Google parent Alphabet Inc. Disappointing earnings from the trio of tech giants sent their shares tumbling in April, taking the steam out of an equity rebound after the S&P 500 had rallied as much as 15 percent from a 22-month low in February.

     In Thursday’s trading, all of the S&P 500’s 10 main industries rose, with consumer staples, industrials and utilities gaining more than 2 percent. A Goldman Sachs Group Inc. basket of the most shorted shares in the Russell 3000 Index was in the midst of its strongest three-day climb since February, up 9 percent.

     Consumer staples climbed 2.2 percent, the most in almost seven months, to a fresh record, spurred by the report of Mondelez’s bid for Hershey. Hershey confirmed it received an offer which it rejected. The shares soared as much as 21 percent, the most in nearly 14 years, to an all-time high. Mondelez advanced 5.9 percent, the most since 2014, and erased losses that followed the U.K. referendum.

     PepsiCo Inc. added 2.7 percent, the best since October. Philip Morris International Inc. and the Coca-Cola Co. increased at least 2 percent.

     The industrials group erased a quarterly slide in the period’s final session after rallying 5.5 percent in three days. General Electric Co. was the biggest driver, gaining 7.4 percent since Monday’s close on the way to a three-month high. 3M Co. and Boeing Co. rose at least 2.1 percent Thursday.

     Utilities reached a fresh all-time high with the group marking a fourth-straight quarterly gain, the longest since 2011. American Water Works Co. led the pack since March with an almost 23 percent climb. NextEra Energy Inc. has been the group’s strongest contributor to the second-quarter increase, rising 10 percent.

     Banks in the benchmark index salvaged a 1 percent quarterly gain, after rallying 7.3 percent in June’s final three sessions. U.S. Bancorp and JPMorgan Chase & Co. added more than 1.5 percent today.

     Among other shares moving on corporate news, Starz rose 5.9 percent after Lions Gate Entertainment Corp. agreed to buy billionaire John Malone’s cable outlet in a deal valued at $4.4 billion. Lions Gate slipped 3.4 percent.

     Visa Inc. slumped 3.4 percent and MasterCard Inc. tumbled 4.4 percent after a court rejected a $5.7 billion settlement of claims the firms improperly fixed credit-card swipe fees, potentially renewing years of litigation with millions of U.S. merchants.

 

Have a wonderful long weekend everyone!

 

Be magnificent!

“Be kind whenever possible. It is always possible.” Dalai Lama

 

As ever,

 

Karen

“We shall never know all the good that a simple smile can do.” Mother Teresa

 

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:

On June 29, 1995, the shuttle Atlantis and the Russian space station Mir docked, forming the largest man-made satellite ever to orbit the Earth.
Go to article »

1908 – First Dominion Exhibition opens in Calgary; origin of Calgary Stampede.

1922 – France formally transfers ownership of 100 hectares at Vimy Ridge to Canada.

1926 – Arthur Meighen appointed Prime Minister following King-Byng controversy.

THINGS MONEY CAN’T BUY:

1. MANNERS
2. MORALS
3. RESPECT
4. CHARACTER
5. COMMON SENSE
6. TRUST
7. PATIENCE
8. CLASS
9. INTEGRITY
10. LOVE

Being challenged in life is inevitable.  Being defeated is optional.

PHOTOS OF THE DAY

Cabins for tourists are seen on the grasslands on the outskirt of Ulaanbaatar, Mongolia, on Wednesday. Jason Lee/Reuters

Mexican President Enrique Pena Nieto (l.), Canadian Prime Minister Justin Trudeau (c.) and US President Barack Obama walk together at the National Gallery of Canada at the start of the North American Leaders’ Summit in Ottawa on Wednesday. Kevin Lamarque/Reuters

Market Closes for June 29^th, 2016

Market Index	Close	Change
Dow Jones	17691.74	+282.02   +1.62%
S&P 500	2069.31	+33.22   +1.63%
NASDAQ	4779.246	+87.379   +1.86%
TSX	14047.90	+205.21
		+1.48%

International Markets

Market Index	Close	Change
NIKKEI	15566.83	+243.69
		+1.59%
HANG SENG	20436.12	+263.66
		+1.31%
SENSEX	26740.39	+215.84
		+0.81%
FTSE 100	6360.06	+219.67
		+3.58%

Bonds

Bonds	% Yield	Previous  % Yield
CND. 10 Year Bond	1.121	1.079
CND. 30 Year Bond	1.759	1.725
U.S.    10 Year Bond	1.5070	1.4613
U.S. 30 Year Bond	2.3130	2.2756

Currencies

BOC Close	Today	Previous
Canadian $	0.77313	0.76731
US $	1.29344	1.30325
Euro Rate 1 Euro=		Inverse
Canadian $	1.43888	0.69499
US $	1.11245	0.89892

Commodities

Gold	Close	Previous
London Gold Fix	1321.50	1309.70
Oil	Close	Previous
WTI Crude Future	49.51	47.85

Market Commentary:

Canada

By Eric Lam

     (Bloomberg) — Canadian stocks rose to cap the biggest two- day rebound since February, as energy producers rallied with crude amid speculation policy makers will move to prevent the U.K.’s European secession from hampering global growth.

     The S&P/TSX Composite Index rose 1.4 percent to 14,036.74 at 4 p.m. in Toronto. The Canadian benchmark has swung back to a 2.5 percent gain in two sessions retracing some of the losses from the biggest two-day drop since February. The S&P/TSX is down 0.2 percent in June, on pace to halt a four-month rally. Trading volume was 11 percent higher than the 30-day average.

     Global markets stabilized yesterday after a sharp two-day downturn in the wake of the surprise U.K. vote to leave the European Union. The S&P/TSX closed Wednesday as the top- performing developed markets in the world in 2016, after being neck-and-neck with New Zealand, according to data compiled by Bloomberg. 

     Energy producers climbed 2.3 percent, leading gains as all 10 industries in the S&P/TSX rose. Crude in New York gained a second day to top $49 a barrel, as U.S. industry data showed stockpiles declined. Canadian Energy Services & Technology Corp. jumped 8.9 percent for the biggest gain.

     Traders are now pricing in a greater probability of an interest rate cut at the Federal Reserve than a hike, according to data compiled by Bloomberg. EU leaders called for an orderly British withdrawal from the bloc to minimize instability. Any negotiations on Britain’s future won’t be started until it gave official notification of its departure.

     Raw-materials producers have led the charge for Canada with a 49 percent gain, the best year-to-date performance for the industry in at least 30 years, according to data compiled by Bloomberg. Gold prices are up almost 25 percent this year, on track for its biggest annual increase since 2010 to halt a three-year slide. The gains in commodity stocks have helped Canadian shares retain their more expensive relative to U.S. peers. The S&P/TSX trades at 21.6 times earnings, about 13 percent higher than the multiple of the S&P 500.

     Canadian Imperial Bank of Commerce dropped 2.6 percent to its lowest level since April, after agreeing to buy PrivateBancorp Inc. for $3.8 billion in a cash-and-stock deal to gain a U.S. commercial banking platform in the lender’s biggest- ever transaction.

     Health-care stocks lagged the broader gauge on Wednesday, adding 0.9 percent. Valeant Pharmaceuticals International Inc. ended the day 0.7 percent higher after falling as much as 2 percent. Valeant’s Bausch + Lomb acquisition looks to be worth less than the $8.7 billion the drugmaker spent to buy the business back in 2013, according to Wells Fargo & Co. analyst David Maris.

     Empire Co., owner of the Sobeys grocery store chain, slumped 11 percent to the lowest level in more than three years. The grocer reported a net loss in its fourth quarter of C$942.6 million, compared with a profit a year ago, as Sobeys same-store sales dropped 1.8 percent. Empire also reported an impairment loss of about C$1.3 billion in its western Canada business unit.

US

By Dani Burger and Bailey Lipschultz

     (Bloomberg) — U.S. stocks advanced amid a global rally, with the S&P 500 Index posting its strongest two-day climb in four months, as tension eased over the impact of a U.K. exit from the European Union.

     Fears that Britain’s EU withdrawal will further stymie global growth continued to ebb, soothed by speculation policy makers will counter the effects. Energy shares capped their best two days since March as crude jumped. A Goldman Sachs Group Inc. basket of the most shorted shares in the Russell 3000 Index saw its biggest surge since 2009, while the Dow Jones Industrial Average stretched its rebound to more than 550 points since Monday’s close. 

     The S&P 500rose 1.7 percent to 2,070.77 at 4 p.m. in New York, bringing its two-day climb to 3.5 percent. The gauge erased its loss for the year after last week wiping out a 2016 advance of as much as 3.7 percent. The Dow jumped 284.96 points, or 1.6 percent, to 17,694.68. The Nasdaq Composite Index increased 1.9 percent. About 8 billion shares traded hands on U.S. exchanges, 11 percent above the three-month average.

     “I don’t think it’s shocking that cooler heads are prevailing temporarily,” said Daniel Kern, chief investment officer of Boston-based TFC Financial Management, which oversees $850 million. “The markets are discounting that there’s very little chance of the Fed raising rates this year. In the last 36 hours, there’s been some discussion about the possibility that the British back away from Brexit. We’re definitely in the speculation phase of this process.”

     With Britain in limbo as EU leaders gathered in Brussels to discuss the nation’s withdrawal from the bloc, traders have pushed back bets on Federal Reserve interest-rate increases, indicating higher borrowing costs are unlikely before 2018. Meanwhile, a majority of economists surveyed by Bloomberg predict that the Bank of England will add more stimulus, including cutting rates in the third quarter.

     Equities recovered for a second session after two days of heavy selling sparked by the Brexit decision last week wiped $3.6 trillion from global equities. The S&P 500 had tumbled 5.3 percent to briefly erase its 2016 advance, and has since cut its post-vote drop by more than half. The CBOE Volatility Index slid for a third day, the longest in two weeks. The measure of market turbulence known as the VIX dropped 11 percent Wednesday to 16.64, the lowest since June 9.

     “Today was just a reaction to an overreaction and a bounce back from depressed levels that weren’t justified by economic realities,” said John Carey, a Boston-based fund manager at Pioneer Investment Management Inc., which oversees about $230 billion. “The outlook though is still murky because the exit will take a couple years, and there may be some repercussions that we aren’t prepared for. We aren’t over the hump or out of the woods quite yet.”

     Investors are looking to policy makers for support as they await Britain’s plan for its extrication from the EU. While European Central Bank President Mario Draghi called for global policy alignment, South Korea announced a fiscal stimulus package on Tuesday and Bank of Japan Chief Haruhiko Kuroda said Wednesday that more funds can be injected into the market should they be needed.

     The turmoil spurred by the U.K. vote interrupted the S&P 500’s march toward an all-time high this month, a move stoked by optimism that a mixture of low rates and moderate growth would bolster rising stock prices. The benchmark came within 1 percent of a record on June 8 and again last Thursday, on the day of the referendum as investors wagered Britain would remain in the EU. The gauge is now on track for its first monthly decline since February, down 1.3 percent.                       

     Trimmed by Wednesday’s rally, the main U.S. equity index’s Brexit losses aren’t spoiling a third straight quarterly advance, with the S&P 500 currently up 0.5 percent for the three months. Energy producers remain the strongest performers during the period, on pace for the biggest gain in two years. Raw- materials fell out of second place following the U.K. vote after the group’s steepest two-day slide since September 2011.

     “The U.S. is continuing to do well, and that’s also cushioning the reaction to Brexit,” said Brad McMillan, chief investment officer of Commonwealth Financial Network in Waltham, Massachusetts, which oversees $100 billion. “It’s looking increasingly likely that the worst-case scenario, which is what markets initially reacted to, is not the most likely case. The initial reaction was overdone and what that did was set the groundwork for a more organized and thoughtful reaction later on.”

     While it’s still too early to detect any impact from Brexit in U.S. economic data, a report today showed consumer purchases moderated last month after the biggest advance since August 2009, as American households realigned outlays with slower income growth. A separate measure showed pending home sales fell more than projected in May, a sign demand cooled after a robust start to the busiest selling season of the year.

     In Wednesday’s trading, energy companies were near the top of the S&P 500’s 10 main industries for a second day, as West Texas Intermediate crude futures rose 4.2 percent after government data showed oil inventories dropped for a sixth week. Banks extended their recovery, and health-care shares were among the strongest performers as drug stocks continued to rebound. Utilities lagged again, rising 0.3 percent.

     Citigroup Inc. led banks higher for two straight days, soaring 9.5 percent to recover much of its 13 percent tumble in the prior two sessions. Bank of America Corp. and JPMorgan Chase & Co. advanced more than 2.8 percent Wednesday. Lenders in the benchmark are up 6 percent since Monday’s close.                        

     Airline stocks shrugged off rising oil prices and a terrorist attack at Istanbul’s main international airport that killed 41 people, with a Bloomberg index of U.S. carriers seeing its strongest back-to-back climb since November 2014. Southwest Airlines Co. and Delta Air Lines Inc. added at least 3.9 percent, while United Continental Holdings Inc. rose 4.2 percent to bring its two-day increase to 7.5 percent.

     Merck & Co. and Pfizer Inc. rose more than 1.7 percent to help power the climb in health-care, while Eli Lilly & Co. jumped 4 percent, its biggest gain in five months. Biogen Inc. added 4.6 percent, the most since April, and the Nasdaq Biotechnology Index advanced 2.2 percent after gaining 3.8 percent yesterday.

     A turnaround in S&P 500 biotechs this quarter has helped push the health-care group to the second-best gain among the index’s 10 main industries, after trailing the pack with a 5.9 percent slide in the first quarter. Pfizer and Bristol-Myers Squibb Co. have risen more than 14 percent in the period to provide the most lift, along with Johnson & Johnson’s 10 percent increase.

     General Electric Co. contributed the strongest boost to the benchmark’s industrial group, rising 2 percent. The company won approval to drop its designation as a too-big-to-fail financial institution, capping a transformation that has included the sale of almost all of its lending business. Boeing Co. rose 2.5 percent and airlines also helped lift industrials, while the Dow Jones Transportation Average gained 2.2 percent.                      

     Technology companies climbed 1.7 percent, with Microsoft Corp. increasing 2.2 percent for its first back-to-back gains in almost a month. Oracle Corp. added 3.6 percent, the most in three months, with the company selling $14 billion of bonds in what would be the year’s third-largest deal. JPMorgan Chase & Co. also upgraded Oracle’s shares to neutral from the equivalent of sell. Facebook Inc. and Cisco Systems Inc. rose at least 1.3 percent.

     Among shares moving on corporate news, Alcoa Inc. lost 2.5 percent, after saying the aluminum smelting business it’s spinning off will take on $1 billion in new debt to help reduce the burden on the remaining company as it battles to maintain credit ratings. The stock fell as much as 3.4 percent.

     Southwestern Energy Co. sank 6.2 percent after the oil and gas explorer said it would sell shares to reduce debt.

Have a wonderful evening everyone!

 

Be magnificent!

I make no distinction between one religion and another.

People may worship me in any form they wish.

The form of worship does not matter to me;

my only concern is the quality of love which is expressed in worship.

I accept every kind of worship, because I am supreme.

The Bhagavad Gita

As ever,

 

Carolann

Throughout the centuries there were men who took first steps down new roads

armed with nothing but their own vision.

                                         -Ayn Rand, 1905-1982, The Fountainhead, 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:

Points of Progress:

FRANCE

To curb the creep of work into private life, a labor-reform bill now in motion includes an  amendment to ban sending email to workers after hours.  It specifically suggests that firms with 50 or more employees draft policies to limit the encroachment of duties wrought by digital technology.  Some charge that the measure does not do enough (adherence would be voluntary).  Others worry that the move would hurt France’s global competitiveness. –BBC

GREENSBORO, N.C.

Citizens won direct control over public spending  – at least a tiny slice of it – when the government of this midsize city became the first in the South (and one of a small but growing number around the world) to implement participatory budgeting.  “The city council agreed to allocate $100,000 for expenditures in each district through [PB],” reports Yes! Magazine.  “The additional cost of implementation…was split between the city and local advocates, who received much of their funding from community foundations.”  Sample result of the people power: The transit authority’s new software shows passengers where buses are in real time. –Yes!Magazine.

SANTIAGO, CHILE

A (mostly) renewable-powered urban rail system will be the world’s first.  The Metro de Santiago signed agreements with international solar-and wind-power concerns that will provide 60 percent  of the system’s electric power needs by 2018.  Among Latin American metro-transit systems Santiago’s is second only to Mexico City’s in size.  –Ecowatch, Energial REnovables (Spanish).

HELSINKI, FINLAND

Score another win for women in science.  Biochemical engineer Frances Arnold was awarded the prestigious $1.2 million Millennium Technology Prize for developing “directed evolution,” a method of producing useful enzymes from renewable resources.  Her work has revolutionized the production of industrial chemicals and even been used to make jet fuel from sugars.   The prize has been awarded every two years since 2004 by the Technology Academy Finland.  Dr. Arnold is based at the California Institute of Technology.

PHOTOS OF THE DAY

Demonstrators in Trafalgar Square, central London, take part in a protest on Tuesday, aimed at showing London’s solidarity with the European Union following the recent EU referendum. Dylan Martinez/Reuters

The SLS Five-Segment Solid Rocket Motor that will launch NASA’s Space Launch System and Orion spacecraft to deep space undergoes a static test fire at the Orbital ATK facility in Promontory, Utah, on Tuesday. Jim Urquhart/Reuters

Market Closes for June 28^th, 2016

Market Index	Close	Change
Dow Jones	17409.72	+269.48   +1.57%
S&P 500	2036.02	+35.48   +1.77%
NASDAQ	4691.867	+97.424   +2.12%
TSX	13839.31	+149.52
		+1.09%

International Markets

Market Index	Close	Change
NIKKEI	15323.14	+13.93
		+0.09%
HANG SENG	20172.46	-54.84
		-0.27%
SENSEX	26524.55	+121.59
		+0.46%
FTSE 100	6140.39	+158.19
		+2.64%

Bonds

Bonds	% Yield	Previous  % Yield
CND. 10 Year Bond	1.079	1.084
CND. 30 Year Bond	1.725	1.724
U.S.    10 Year Bond	1.4613	1.4512
U.S. 30 Year Bond	2.2756	2.2770

Currencies

BOC Close	Today	Previous
Canadian $	0.76731	0.76495
US $	1.30325	1.30728
Euro Rate 1 Euro=		Inverse
Canadian $	1.44433	0.69236
US $	1.10826	0.90232

Commodities

Gold	Close	Previous
London Gold Fix	1309.70	1324.55
Oil	Close	Previous
WTI Crude Future	47.85	46.33

Market Commentary:

Canada

By Eric Lam

     (Bloomberg) — Canadian stocks rose, bouncing back from the steepest two-day slide since February, as equity markets around the world rallied for the first time since the U.K.’s surprise vote to leave the European Union.

     The S&P/TSX Composite Index rose 1.1 percent to 13,842.69 at 4 p.m. in Toronto, after the benchmark posted a two-day retreat of 3.1 percent through Monday, the biggest since February as global markets churned in the wake of the U.K. referendum. The S&P/TSX remains negative in June, with a 1.6 percent loss for the month and on pace to halt a four-month rally.

     Energy producers and the nation’s largest lenders contributed the most to gains in the S&P/TSX as nine of 10 industries advanced. Royal Bank of Canada and Toronto-Dominion Bank increased more than 1.5 percent as lenders rebounded from the lowest level in more than two months. Industrial producers increased 1.6 percent, led by gains in the railroad operators. Only materials producers fell, led by gold miners as demand for haven assets faltered.

     Bombardier Inc. jumped 5 percent, the most in two months, after the struggling aircraft manufacturer finalized a firm order with Air Canada for 45 C Series jets. The sale is valued at $3.8 billion based on list prices.

     Suncor Energy Inc. and Canadian Natural Resources Ltd. rose at least 1.7 percent to lead energy stocks higher as all but two members of the S&P/TSX Energy Index advanced. Crude futures in New York rose 3.3 percent, after slumping 7.5 percent over the previous two sessions.

     Raw-materials producers are the only laggards in the broader index, slipping 0.6 percent as a group as gold retreated after its biggest two-day surge in seven years. Barrick Gold Corp. dropped 2.6 percent, after soaring 12 percent in the previous two sessions.

     Canadian equities have fared relatively better compared with global markets this year, led by a resurgence in commodities prices. A gauge of raw-materials producers has jumped 47 percent while energy stocks jumped 14 percent.

     The S&P/TSX is neck-and-neck with New Zealand as the top- performing developed markets in the world in 2016, with the countries now the only two among 24 in positive territory, according to data compiled by Bloomberg. It’s a far cry from 2015, when the S&P/TSX was one of the worst markets in the world, slumping the most since the 2008 financial crisis.

     Canadian shares remain more expensive relative to their U.S. peers. The S&P/TSX now trades at 21.3 times earnings, about 13 percent higher than the valuation of the S&P 500 Index.

     Global markets rebounded as the S&P 500 Index increased 1.8 percent, recovering from the lowest close since March on Monday. First-quarter U.S. economic growth rose at a 1.1 percent annualized rate, exceeding previous estimates of 0.8 percent on improved trade and business investment. EU leaders are gathering for a two-day European Council summit to discuss Britain’s exit.

US

By Dani Burger and Bailey Lipschultz

     (Bloomberg) — U.S. stocks surged the most in nearly four months, rising for the first time since Britain voted to leave the European Union amid optimism that policy makers are committed to limit the fallout from the U.K.’s exit.

     Tuesday’s turnaround gathered pace late in the day, with the Dow Jones Industrial Average adding more than 260 points. Banks had the strongest rally in six weeks, following their worst back-to-back sessions in almost five years. Facebook Inc., Apple Inc. and Microsoft Corp. rose at least 1.6 percent to boost the technology group, while energy producers climbed the most in 2 1/2 months as crude prices jumped.

     The S&P 500 Index advanced 1.8 percent to 2,036.09 at 4 p.m. in New York, the most since March 1 amid a rebound from the steepest two-day drop since August. Gains accelerated in afternoon trading as the index pushed above its average price during past 200 days. The rally topped out near the 100-day moving average. The Dow added 269.48 points, or 1.6 percent, to 17,409.72. The Nasdaq Composite Index increased 2.1 percent.

     “It’s a case of confidence, when the market goes higher it brings confidence,” said Richard Sichel, chief investment officer at Philadelphia Trust Co., which oversees $2 billion. “Getting through most of the day and the market holding onto those gains, that pulls in other investors who may have been watching and just waiting to step up.”

     The U.K.’s decision last week triggered a rush toward safe havens as global equities lost about $3.6 trillion in market value and the S&P 500 tumbled 5.3 percent to erase its 2016 advance. The CBOE Volatility Index tumbled 21 percent Tuesday, the most since 2011, though the measure of market turbulence known as the VIX is still on the way to its biggest monthly climb since a record jump last August.

     After the market closed, Nike Inc. sank 6.9 percent as of 4:52 p.m. as its future orders, a proxy for demand, missed estimates. The disappointment renewed concerns that the world’s largest sports brand has entered a period of slowing growth.

     European Central Bank President Mario Draghi added to speculation of a more coordinated effort by policy makers to mitigate the Brexit repercussions, calling for global policy alignment in a speech at the ECB Forum in Sintra, Portugal. Draghi said there is a “common responsibility” to address the world’s economic weaknesses.                          

     The rally Tuesday brings a measure of relief after two days of sharp declines spurred by concerns that Britain’s EU exit would further burden an already sluggish global economy. Investors have pushed back bets on Federal Reserve interest-rate increases, pricing in just a 10 percent chance for higher borrowing costs by February 2017, down from 52 percent before the vote outcome. Odds for a rate cut by November are nearly 14 percent.

     EU leaders gathered for a two-day European Council summit to discuss Britain’s exit. Germany, France and Italy prodded the U.K. government to start the process, saying they want to move forward and limit market risks. Britain’s Chancellor of the Exchequer George Osborne sought to reassure investors on Monday, saying that contingency plans were in place to shore up the economy amid ongoing volatility, but that Brexit won’t be “plain sailing” — something that Cameron reiterated in Parliament.

     “People are calming down and looking at it more rationally,” said John Conlon, chief equity strategist at People’s United Wealth Management, which oversees $5.5 billion. “It’s a combination of that plus the fact that by now you’ve seen the investors that were betting that Brexit wasn’t going to happen finally unwinding those bets.”

     Aside from the Brexit drama, a report today showed the U.S. economy expanded more than previously projected in the first quarter as improved performance in trade and business investment more than made up for weaker consumer spending. Separate data showed consumer confidence rose to the highest since October as Americans became somewhat more optimistic about the economy.

     In Tuesday’s trading, energy, financial and technology shares were the strongest among the S&P 500’s 10 main industries, increasing at least 2 percent. Health-care and consumer discretionary companies added more than 1.9 percent. A Goldman Sachs Group Inc. basket of the most shorted shares in the Russell 3000 Index jumped 2.5 percent, the most in more than two months. About 8.4 billion shares traded hands on U.S. exchanges, 16 percent above the three-month average.                          

     Banks in the S&P 500 increased 3.2 percent, the steepest since May 18, after falling 10 percent in two sessions. JPMorgan Chase & Co. and Wells Fargo & Co. added more than 2.4 percent. Comerica Inc. and Regions Financial Corp. were among the biggest gainers in the group, climbing at least 4 percent after back-to- back losses of more than 16 percent.

     Biotechnology shares led the rally in health-care, with Gilead Sciences Inc. jumping 4.8 percent, the most in almost five months. Regulators approved Gilead’s hepatitis C drug for all forms of the viral disease. Celgene Crop. rose 2.2 percent, while Regeneron Pharmaceuticals Inc. and Biogen Inc. climbed at least 1.5 percent. The Nasdaq Biotechnology Index jumped 3.8 percent, the most in 11 weeks.

     In the broader health-care group, Johnson & Johnson rose 1.4 percent in its fourth gain in five days, climbing to an all- time high. Allergan Plc and Medtronic Plc added at least 2.1 percent.                          

     Microsoft rose 2.1 percent to boost tech companies in the benchmark, clawing back a portion of a 6.7 percent drop in the prior two sessions as the software giant bounced from an eight- month low. Facebook surged 3.4 percent, its best gain in two months. Seagate Technology Plc and Micron Technology Inc. posted the strongest advances, rising at least 6.2 percent. The Philadelphia Stock Exchange Semiconductor Index added the most since May 20.

     Oil and gas companies marked their best session since April 12 as West Texas Intermediate crude futures jumped 3.3 percent. Exxon Mobil Corp. rallied 2.3 percent, the strongest since March 7, while Marathon Petroleum Corp. advanced 8.4 percent, its biggest one-day climb since February 2012.

     Dow Chemical Co. and merger partner DuPont Co. lost 2 percent after Dow said it plans to eliminate about 2,500 jobs and shut plants in North Carolina and Japan as it slims down after taking full control of its Dow Corning Corp. silicone venture. The company announced the Corning deal in December at the same time it unveiled an agreement to merge with DuPont, a $56.4 billion combination that’s under antitrust scrutiny.

     Among other shares moving on corporate news, Xencor Inc. soared 32 percent, the most since December 2013, to help boost the Russell 2000 Index. The company announced a deal with Novartis AG to collaborate on developing cancer therapies. Novartis added 3 percent, the most in a month.

 

Have a wonderful evening everyone.

 

Be magnificent!

What then do I mean by the ideal of a universal religion?

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

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

What can we do?

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

By what?

By recognizing variation.

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

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

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

and yet be the same thing.

Swami Vivekananda

As ever,

 

Carolann

 

I’ve never been poor, only broke.  Being poor is a frame of mind. 

Being broke is only a temporary situation.

                                                    -Michael Todd, 1909-1958

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:

On this day in 1914 the poet Edward Thomas and his wife Helen were going by train to see the American poet Robert Frost at Ledbury in Herefordshire.  Thomas made some jottings about these suspended moments in his notebook and much later, some time in the first five months of 1915 and after Frost had convinced him of his vocation as a poet, he wrote this, his most famous poem.  He was killed on the Western Front in 1917.  Adlestrop station was an early victim of Dr. Beeching’s rationalization of the rail network in the 1960s.

Adlestrop

Yes, I remember Adlestrop –
The name, because one afternoon
Of heat the express-train drew up there
Unwontedly.  It was late June.

The steam hissed.  Someone cleared his throat.
No one left and no one came
On the bare platform.  What I saw
Was Adlestrop – only the name

And willows, willow-herb, and grass,
And meadowsweet, and haycocks dry,
No whit less still and lonely fair
Than the high cloudlets in the sky.

And for that minute a blackbird sang
Close by, and round him, mistier,
Farther and farther, all the birds
Of Oxfordshire and Gloucestershire.

PHOTOS OF THE DAY

Traders from BGC, a global brokerage company in London’s Canary Wharf financial center, react as European stock markets open early Friday after Britain voted to leave the European Union in the EU BREXIT referendum. Russell Boyce/Reuters

Britain’s Prime Minister David Cameron leaves Number 10 Downing Street in London on Friday with his wife, Samantha, to speak after Britain voted to leave the European Union. Phil Noble/Reuters

People walk on the installation ‘The Floating Piers’ by Bulgarian-born artist Christo Vladimirov Yavachev, known as Christo, on Lake Iseo, northern Italy, on Friday. Stefano Rellandini/Reuters

Market Closes for June 24th, 2016

Market Index	Close	Change
Dow Jones	17401.50	-609.57   -3.38%
S&P 500	2042.00	-71.32   -3.37%
NASDAQ	4707.980	-202.061   -4.12%
TSX	13869.61	-261.77
		-1.85%

International Markets

Market Index	Close	Change
NIKKEI	14952.02	-1286.33
		-7.92%
HANG SENG	20259.13	-609.21
		-2.92%
SENSEX	26397.71	-604.51
		-2.24%
FTSE 100	6138.69	-199.41
		-3.15%

Bonds

Bonds	% Yield	Previous  % Yield
CND. 10 Year Bond	1.176	1.291
CND. 30 Year Bond	1.808	1.917
U.S.    10 Year Bond	1.5735	1.7458
U.S. 30 Year Bond	2.4247	2.5547

Currencies

BOC Close	Today	Previous
Canadian $	0.76881	0.78352
US $	1.30071	1.27629
Euro Rate 1 Euro=		Inverse
Canadian $	1.44219	0.69339
US $	1.10877	0.90190

Commodities

Gold	Close	Previous
London Gold Fix	1315.50	1262.15
Oil	Close	Previous
WTI Crude Future	47.19	49.21

Number of the Day
17,410,742
17.4 million Britons voted to leave the European Union, 51.9% of total votes. 16,141,241 voted to remain, 48.1% of the total.

Market Commentary:

Canada

By Eric Lam and Allison McNeely

     (Bloomberg) — Canada’s currency fell with its stocks while bonds rallied after Britain’s decision to secede from the European Union spurred concern the global recovery will falter.

     The yield on the Canadian government 10-year bond fell 13 basis points to 1.163 percent as investors sought refuge in fixed income. The country’s currency declined 1.85 percent to C$1.3012, after earlier falling the most in six years. The S&P/TSX Composite Index dropped 1.7 percent, less than most global stock indexes, as a gold rally limited declines.

     “I went to sleep confident and woke up looking, what happened here? It was totally unexpected,” Ian Nakamoto, director of research at MacDougall MacDougall & MacTier Inc. in Toronto.

     On a day when the surprise vote rattled global markets, Canadian assets fared relatively well. The loonie was the sixth- best performer among global currencies, while the equity decline was among the smallest in major markets.

     “We are well positioned to weather global market uncertainty as we have done in the past,” Prime Minister Justin Trudeau said in a statement from Ottawa. Trudeau was expected to speak later today in Quebec.

     The Bank of Canada, meanwhile, said the Group of Seven central banks are monitoring the situation closely. The Brexit vote may push back any rate increase into the fourth quarter of 2017, BMO Capital Markets economists said in a research note Friday. The vote also rules out a July increase by the U.S. Federal Reserve, they said.

     Trading in the swaps market suggests a 21 percent chance of a Bank of Canada rate cut in October, from just 7 percent Thursday.

     The U.K. was Canada’s fifth-largest trading partner last year, accounting for about $21.2 billion in total trade, according to data compiled by Bloomberg. That compared with more than $540 billion in cross-border commerce with the U.S., Canada’s largest partner by far.

     Canadian firms most exposed to the European market include Brookfield Asset Management Inc., CGI Group Inc. and Great-West Lifeco Inc.. Other firms with relatively large exposures include software company Open Text Corp.; plane and train maker Bombardier Inc.; aircraft simulator maker CAE Inc. and engineering firm WSP Global Inc.

     An index of the 19 Canadian companies most exposed to Europe dropped 3.6 percent, more than twice the drop of the main gauge, led by Great-West, Concordia Healthcare Corp. and Bombardier.

     Crude also fell, with the price for West Texas Intermediate dropping 4.9 percent, the biggest decline in four months. That may weigh on the Canadian currency, traders said.

     “We envision the Canadian dollar could weaken by up to 5 to 6 percent over the coming months based on the fact that this is a large-scale shock for global growth,” Bipan Rai, head of foreign exchange at the Canadian Imperial Bank of Commerce in Toronto, said by phone. “That’s not good for our export picture and our currency may bear the brunt of that pain.”                       

     Collectively, less than 3 percent of the S&P/TSX company revenue is derived from the U.K., according to Ian de Verteuil, a Toronto-based analyst with Canadian Imperial Bank of Commerce who created a Brexit index to track Canadian stocks most tied to the vote. For the year to date, the 19 so-called Brexit stocks have lost 0.3 percent, compared with the 6.8 percent gain for the benchmark S&P/TSX Composite Index.  

     “We have undertaken an in-depth analysis of the potential risks to our businesses, and notwithstanding the potential for increased market volatility and uncertainty that may arise, our businesses are resilient and we maintain significant financial flexibility, ” said Paul Mahon, chief executive officer of Winnipeg, Manitoba-based Great-West, said in a statement. Great- West, which has been in the U.K. since 1903, remains committed to Europe, Mahon said in the statement.

     Aimia Inc., the Montreal-based loyalty card company, which owns and operates Nectar, the largest loyalty program in the U.K., said the decline in the pound against the Canadian dollar would be unlikely to have material mid-term effects on the the company’s financial results. The pound was down 6.56 percent to C$1.7743.

     “The pressure on gross billings and operating costs from our U.K. business when the pound falls is counterbalanced by a reduction in costs related to global product development work that is also done in London,” said Rupert Duchesne, group chief executive at Aimia.

     Jason Russell, chief investment officer at Acorn Global Investments in Oakville, Ontario, said the firm, which manages about C$260 million ($199 million), reduced its risk ahead of the referendum though the result was still a shock.

     “Look, everyone walked into this thing last night knowing Remain was going to win,” he said. “Everyone felt that 12 hours ago. Strong opinions will get you in trouble.”

US

By Dani Burger and Anna-Louise Jackson

     (Bloomberg) — U.S. stocks plunged the most in 10 months, joining a selloff in global risk assets on speculation that the U.K. decision to leave the European Union will hamper worldwide growth.

     Equities sank to session lows in afternoon trading, with the Dow Jones Industrial Average sliding more than 600 points. The S&P 500 Index extended losses after falling below the 2,050 level, an area where other pullbacks during the prior two months found a floor. Banks, technology, raw-materials and industrial shares capped their worst single-day declines in more than four years.

     “Market participants are right to be concerned,” said Dean Maki, chief economist of investment firm Point72 Asset Management. “This is a legitimate risk-off event. We’re likely to see weaker growth as a result of this, and it’s appropriate that markets are reacting to this. Exports are likely to be weaker and earnings are a function of exports. U.S. exporters are going to have to deal with a stronger dollar again.”

     The S&P 500 fell 3.6 percent to 2,037.30 at 4 p.m. in New York, the most since August 24. The benchmark slid 1.6 percent for the week and erased its 2016 gain, which reached as much as 3.7 percent earlier this month. The Dow dropped 611.21 points, or 3.4 percent, to 17,399.86, also the biggest retreat since August. The Nasdaq Composite Index tumbled 4.1 percent, the most in almost five years. About 15 billion shares traded hands on U.S. exchanges, more than double the daily average during the past three months.

     The victory of the “Leave” campaign stunned many investors who’d put wagers on riskier assets over the past week as bookmakers’ odds suggested the chance of a so-called Brexit was less than one in four. The S&P 500 had gained 2 percent this week before the results were announced. The pound plunged the most in 30 years and European equities dropped as investors weighed the vote’s implications for the global economy.

     The day’s turbulence was accompanied by a chorus of central-bank assurances that policy makers stand ready to intervene. Governor Mark Carney said the Bank of England could pump billions of pounds into the financial system, while the European Central Bank said it will give banks all the funding they require to counter market turmoil. The Federal Reserve said it was “carefully monitoring” financial markets.

     As if results of the U.K. vote wasn’t enough, today was also the date of the annual rebalancing of FTSE Russell’s stock indexes, a procedure that reliably exacerbates trading. In 2015, the reconstitution helped fuel a jump in volume to more than 10 billion shares, the seventh-highest total of the year.                        

     Banks plunged after rallying the most in five weeks Thursday, with Citigroup Inc. down 9.4 percent, its steepest in four years. JPMorgan Chase & Co. and Goldman Sachs Group Inc. lost more than 6.9 percent, the most since at least 2012. Caterpillar Inc. and Boeing Co. sank more than 5.2 percent after pacing the Dow’s biggest gain in three months Thursday. Energy shares fell 3.5 percent as crude decreased 4.9 percent.

     “Fundamentally, this probably doesn’t impact many U.S. companies that aren’t invested in the U.K., though it impacts sectors like financials because it looks like there won’t be a Fed rate hike for a little bit longer, though even they don’t really know,” said Tim Ghriskey, who oversees $1.5 billion as managing director and chief investment officer at Solaris Asset Management.

     Traders abandoned bets on future interest-rate increases well into 2017, after expectations for higher borrowing costs this year had crept up yesterday on optimism the U.K. would remain in the EU. Odds of a Fed move by February plunged to 15 percent from 52 percent Thursday, while probability of an actual rate cut before the December meeting rose to more than 13 percent.

     In Friday’s session, nine of the S&P 500’s 10 main industries slid, with financials reversing their strongest climb since April with the biggest drop in four years. Seven groups sank at least 2.8 percent, with industrials, technology and raw- materials posting the worst one-day drop since 2011. Utilities were little changed.

     Ford Motor Co. lost 6.6 percent, the most since September 2014, after saying the Brexit will have an “adverse impact” on its operations. Parts makers Delphi Automotive Plc and BorgWarner Inc. slumped more than 9.5 percent. General Motors Co. slid 4.9 percent toward a four-month low.

     JPMorgan published a list last month of 22 stocks with the highest sensitivity to the Brexit outcome. The group is down an average 6.4 percent today. Among the companies identified by Dubravko Lakos-Bujas, JPMorgan’s chief U.S. equity strategist, Penske Automotive Group Inc. slumped 10 percent, the most since October 2009, while Invesco Ltd. has tumbled 14 percent for the biggest drop in seven years.

     The vote comes at a time when uncertainty already plagues U.S. stocks, with questions around the Fed’s ability to stoke growth after the worst month for hiring since 2010, a four- quarter decline in corporate profits, price-earnings ratios that are close to a decade high and a presidential election looming in the fall.

     The S&P 500 plunged 11 percent in its worst-ever start to a year before recovering through April. It’s virtually been stuck in place since, struggling to hold above the 2,100 level that has capped three rallies since November. It fell from that perch again after closing above it Thursday for the first time in two weeks.

     Fallout from the U.K.’s secession vote leaves global investors as reliant on their hedges as any time since the selloff that rocked markets in January and February. Trading of options and derivatives over the last week has risen in instruments that gain in times of market turbulence, among them futures on the CBOE Volatility Index. The measure of turmoil known as the VIX jumped 49 percent Friday, the most since August 2011.
 

Have a wonderful weekend everyone.

 

Be magnificent!

The spirit of democracy

is not a mechanical thing

to be adjusted by abolition of forms.

It requires change of heart.

Mahatma Gandhi

As ever,

 

Carolann

Remember your humanity, and forget the rest.

                    –Bertrand Russell, 1872-1970

 

 

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:

More words of wisdom from Commencement speakers:

Condoleezza Rice

Former Secretary of State

High Point University

“There’s no earthly reason that a black girl from Birmingham, Ala., should be a Soviet specialist.  But that’s what I wanted to be.  Don’t let anyone else define your passion for you because of your gender or the color of your skin.  Because of all that my grandfather and my many other ancestors did, even enduring poverty and segregation and second-class citizenship, they understood that education was a privilege, not a right.  And that it therefore conferred certain obligations.  It’s possible today to live in an echo chamber that serves only to reinforce your own high opinion  of yourself and what you think.  There is nothing wrong with holding an opinion and holding it strongly.  But at times when you are sure that you’re absolutely right, go and find somebody who disagrees.  Don’t allow yourself the easy course of the constant amen to everything that you say.”

If you destroy a free market you create a black market.  If you have ten thousand regulations you destroy all respect for the law. –Winston Churchill, 1874-1965.

 

TODAY IN HISTORY

1868 – Christopher Latham Sholes received a patent for an invention he called the “Type-Writer.”

1817 – Bank of Montreal incorporated with £250,000 capital; Canada’s oldest.

1896 – Wilfrid Laurier leads Liberals to victory in the 8th general election, beating Tupper’s Conservatives.

1974 – John Diefenbaker sworn in as an MP for a record 12th consecutive time.

1985 – Terrorist bomb downs Air India Flight 182 Boeing 747 from Toronto off the coast of Ireland.

PHOTOS OF THE DAY

Chelsea Pensioners leave after voting in the EU referendum at a polling station in London on Thursday. Toby Melville/Reuters

 

Hello Kitty face grown on a melon, which is produced in Hokkaido, is pictured at the Sanrio Co headquarters in Tokyo, Japan on Thursday.Toru Hanai/Reuters

Market Closes for June 23^rd, 2016

Market Index	Close	Change
Dow Jones	18011.07	+230.24   +1.29%
S&P 500	2113.32	+27.87   +1.34%
NASDAQ	4910.043	+76.724   +1.59%
TSX	14131.38	+127.57
		+0.91%

International Markets

Market Index	Close	Change
NIKKEI	16238.35	+172.63
		+1.07%
HANG SENG	20868.34	+73.22
		+0.35%
SENSEX	27002.22	+236.57
		+0.88%
FTSE 100	6338.10	+76.91
		+1.23%

Bonds

Bonds	% Yield	Previous  % Yield
CND. 10 Year Bond	1.291	1.232
CND. 30 Year Bond	1.917	1.872
U.S.    10 Year Bond	1.7458	1.6835
U.S. 30 Year Bond	2.5547	2.4992

Currencies

BOC Close	Today	Previous
Canadian $	0.78352	0.77863
US $	1.27629	1.28431
Euro Rate 1 Euro=		Inverse
Canadian $	1.45278	0.68833
US $	1.13829	0.87851

Commodities

Gold	Close	Previous
London Gold Fix	1262.15	1264.85
Oil	Close	Previous
WTI Crude Future	49.21	48.43

Market Commentary:

Canada

By Bailey Lipschultz and Eric Lam

     (Bloomberg) — Canadian stocks rallied the most in five weeks, joining rising markets around the globe as investors awaited the outcome of today’s U.K. referendum on membership in the European Union.

     The S&P/TSX Composite Index rose 0.9 percent to 14,131.38 at 4 p.m. in Toronto, a two-week high, with eight of 10 main industries in the benchmark gaining. The index is on the way to halting a weekly losing streak at two, advancing 1.7 percent since Friday’s close. A snap-back in commodity prices has pushed the Canadian gauge to the top spot among developed equity markets this year, up 8.6 percent.

     Investors worldwide have been glued to Britain’s debate on its EU membership in recent weeks, and past polls have indicated a close race. The first voting results are expected around 7 p.m. New York time. The final ones are due at about 2 a.m. on Friday.

     U.S. shares rallied as banks and oil producers also led the S&P 500 Index higher to within 1 percent of its record, while European stocks gained to the highest in three weeks in above- average volume. The pound strengthened to its highest value this year.

     Energy companies in Canada climbed 2 percent, with Suncor Energy Inc. increasing 3.8 percent to extend a rally for a sixth session, its longest since November. Enbridge Inc. climbed 1 percent, closing at its highest level since November. West Texas Intermediate crude futures in New York gained after U.S. output and supplies fell.

     Royal Bank of Canada added 1.6 percent, the most in five weeks, as the bank plans to hire more investment advisers and may add a robo-advisory platform. Toronto-Dominion Bank and Bank of Nova Scotia rose at least 0.9 percent.

     Consumer staples companies advanced 0.9 percent. Alimentation Couche-Tard Inc. rallied 1.9 percent, paring its slide this month to 7.8 percent, while Maple Leaf Foods Inc. gained 1.6 percent.

     BlackBerry Ltd. increased 3.4 percent, the most since March, after forecasting better-than-expected profit and insisting there was a way to make its ever-shrinking phone business profitable again. Celestica Inc. advanced 0.7 percent, its best in three weeks.

     Canadian Pacific Railway Ltd. rose 1.7 percent, its first back-to-back gain in three weeks, to help boost the industrials group. Bombardier Inc. rose 1 percent after Quebec’s provincial government agreed to invest $1 billion in the C Series jetliner development program, sealing a deal that took eight months to nail down.

US

By Roxana Zega and Bailey Lipschultz

     (Bloomberg) — U.S. stocks rose, mirroring equities around the world and sending the S&P 500 Index to the strongest gain in a month, amid a U.K. referendum on its European Union membership.

     Bank stocks capped the best day in five weeks, with JPMorgan Chase & Co. and Citigroup Inc. rising more than 2.1 percent. Raw-materials producers advanced for the sixth time in seven sessions while energy companies rebounded with crude oil after slipping Wednesday for the first time in four days. Caterpillar Inc. and Boeing Co. increased more than 1.3 percent, while Microsoft Corp. gained 1.8 percent.

     The S&P 500 added 1.3 percent to 2,113.32 at 4 p.m. in New York, after two opinion polls conducted before Thursday showed a lead for the campaign to keep Britain in the EU. The index moved within 1 percent of an all-time high. The Dow Jones Industrial Average rallied 230.24 points, or 1.3 percent, to 18,011.07, the biggest gain since March 1. The Nasdaq Composite Index added 1.6 percent, the most in a month. About 6.4 billion shares traded hands on U.S. exchanges, 7 percent below the three-month average.

     “The markets have remained relatively quiet for the most part because ahead of any vote, it’s just a waiting game,” said Michael Antonelli, an institutional equity sales trader and managing director at Robert W. Baird & Co. in Milwaukee. “Traders have set their stance either way and will wait and see what the result is.”

     Investors worldwide have been glued to Britain’s debate on its EU membership in recent weeks, and past polls have indicated a close race. The first voting results are expected around 7 p.m. New York time, with the final ones due at about 2 a.m. on Friday.

     Among the information investors will digest tonight, the Federal Reserve released results of its bank stress tests. Announced after the close of trading Thursday, the tests found the 33 biggest banks all have enough capital to weather a severe economic shock. The examination runs through hypothetical scenarios, as regulators push lenders to build up capital buffers to prevent a repeat of the 2008 financial crisis. The banks included Well Fargo & Co., JPMorgan & Chase Co. and Morgan Stanley, which trailed the rest of Wall Street in a key measure of leverage.

     The S&P 500’s rally Thursday followed the index’s first retreat in three days, and a 15 percent jump in the CBOE Volatility Index amid fragile sentiment before the U.K. vote. The gauge of market turbulence known as the VIX reversed today, tumbling nearly 19 percent, the most since October 2013. A Goldman Sachs Group Inc. basket of the most shorted shares in the Russell 3000 Index rose the most in two months.

     Among the stocks providing the biggest lift today, Visa Inc., Amazon.com Inc. and General Electric Co. advanced at least 1.3 percent, with GE reaching a two-month high. Chevron Corp. and Intel Corp. rose more than 2.1 percent.

     “People have already taken positions ahead of the vote,” said Patrick Spencer, equities vice chairman at Robert W. Baird & Co. in London. His firm manages $151 billion. “Markets hate uncertainty and tomorrow we’ll finally have certainty — we’ll know which way we’re going. In the U.S., we’re back to that Goldilocks scenario. You’ve got reasonable growth, but not so strong so as to raise rates.”

     The main U.S. equity benchmark has struggled to top an all- time high reached 13 months ago, after closing within 0.6 percent of the mark earlier in June. The S&P 500 surged as much as 16 percent from a 22-month low in February amid rebounding oil prices and improving economic data, though its momentum has been challenged by successive quarters of declining corporate profits, recent signs of slowing job gains and concerns that central-bank efforts to bolster growth are losing their efficacy.                         

     Those worries were roused last week after the Federal Reserve signaled less optimism on the economic outlook, scaling back its projections for the pace of future interest-rate increases amid concerns about slower job growth and the U.K.’s potential EU exit. In testimony to lawmakers this week, Fed Chair Janet Yellen indicated a cautious and uncertain view of the economy.

     Traders are now pricing in even odds for a rate increase by December, up from 34 percent a week ago in the wake of the Fed meeting. Chances for higher borrowing costs in September have jumped to 33 percent from 16 percent last Thursday.

     As investors and policy makers assess incoming data to judge the path for rates, a report today showed fewer Americans than forecast filed for unemployment benefits last week, adding to evidence that the labor market is healthy and stable. Separate data showed purchases of new homes declined in May from an eight-year high as the housing market continued to display the choppy progress that’s been a hallmark of the recovery.

     All of the S&P 500’s 10 main industries rose in Thursday’s trading, with financials climbing 2.1 percent, the most in two months. Raw-materials, technology and energy shares added at least 1.5 percent. Utilities were the laggards, rising 0.3 percent.

     Leucadia National Corp. and Charles Schwab Corp. were the strongest performers among financials in the benchmark, with gains of more than 4.7 percent. Comerica Inc. and Citigroup rose at least 4.1 percent. The KBW Bank Index increased 2.9 percent, the most since May 18.

     Leading the rally in the tech group, Micron Technology Inc. jumped 10 percent to a five-month high after Nomura Securities upgraded the shares to buy from the equivalent of sell, highlighting memory supply shortages and “firmer” prices. Western Digital Corp. gained 5.1 percent to the highest since March 22, and Qorvo Inc. increased 4.7 percent to its strongest level in six months.

     The consumer staples group climbed to a fresh record and approached a sixth monthly increase in the last seven. Archer- Daniel-Midlands Co., Mondelez International Inc. and Walgreens Boots Alliance Inc. added more than 1.5 percent. Whole Foods Market Inc. increased 1 percent, snapping an 11-day losing streak, the longest since 1998.

     Airlines slipped for a second day, led lower by Southwest Airlines Co.’s 1.7 percent slide. The carrier will postpone delivery of 67 Boeing Co. 737 Max 8 aircraft by as many as six years, pushing $1.9 billion of spending on the planes into the next decade as it focuses on near-term technology and operational improvements. Delta Air Lines Co. lost 0.6 percent.
 

Have a wonderful evening everyone.

 

Be magnificent!

The end to be sought is human happiness combined with full mental and moral growth.

This end can be achieved under decentralization.

Centralization as a system is inconsistent with a non-violent structure of society.

Mahatma Gandhi

 

As ever,

 

Carolann

 

The wicked flee when no man pursueth,

but the righteous are as bold as a lion.

                                 -Proverbs 28:1

 

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:

The Arts, News:

FRENCH ART COMES TO YOUR BROWSER
Paris Musées, a group of museums including the National Museum of Modern Art in  Paris and the Carnavalet Museum, recently made many works available for viewing online.  Browse at your leisure or take a “tour,” which groups together pieces from different museums based on various themes.   Check it out at http://parismuseescollections.paris.fr.

NEW DRAMA FROM JULIAN FELLOWES
“Downton Abbey” creator Julian Fellowes has written another period drama for TV.  Julian Fellowes Presents Doctor Thorne tells the story of Mary Thorne, an impoverished young woman who is raised by her uncle.  It’s streaming on Amazon Prime.

WATCHING THE PARTY
One-man-band Andy Shauf is The pride of Regina, Saskatchewan.  The party is his engaging new album, and it is aptly named….Comparisons to Elliott Smith and harry Nilsson are fair, but late-period Brian Wilson also comes to mind.

SARAH JAROSZ
Texan teenager Sarah Jarosz, three years since graduating with honors from the New England Conservatory, has released her fourth record Undercurrent, which boasts rich contrasts, with a song about heart-break,House of Mercy giving way to the summery love song Green Lights in which Jarosz’s voice floats, feather-like, over breezy acoustic sounds.

                                       -from “Staff Picks,” CSM, June 13, 2016.

On June 22, 1940, during World War II, Adolf Hitler gained a stunning victory as France was forced to sign an armistice eight days after German forces overran Paris. Go to article »

1813 – Laura Secord Warns British of an American Attack
1976 – House of Commons votes to abolish the death penalty with a six-vote majority.

THE SIMPLE LIFE

missing somebody……..call
wanna meet up…………invite
wanna be understood…explain
have a question…………ask
don’t like something…..say it nicely
like something…………..declare it
want something…………ask for it
stressed……………………let go
love someone…………….say it

PHOTOS OF THE DAY

A ‘Vote Remain’ banner being towed by an aircraft is seen behind the London Eye in London, Britain on Wednesday. Toby Melville/Reuters

A Belgium fan wears a model of the Atomium on his head in Nice, France on Wednesday. Wolfgang Rattay/Reuters

Market Closes for June 22^nd, 2016

Market Index	Close	Change
Dow Jones	17780.83	-48.90   -0.27%
S&P 500	2085.45	-3.45   -0.17%
NASDAQ	4833.320	-10.443   -0.22%
TSX	14003.81	-8.51
		-0.06%

International Markets

Market Index	Close	Change
NIKKEI	16065.72	-103.39
		-0.64%
HANG SENG	20795.12	+126.68
		+0.61%
SENSEX	26765.65	-47.13
		-0.18%
FTSE 100	6261.19	+34.64
		+0.56%

Bonds

Bonds	% Yield	Previous  % Yield
CND. 10 Year Bond	1.232	1.252
CND. 30 Year Bond	1.872	1.884
U.S.    10 Year Bond	1.6835	1.7059
U.S. 30 Year Bond	2.4992	2.5096

Currencies

BOC Close	Today	Previous
Canadian $	0.77863	0.78061
US $	1.28431	1.28104
Euro Rate 1 Euro=		Inverse
Canadian $	1.45084	0.68926
US $	1.12967	0.88522

Commodities

Gold	Close	Previous
London Gold Fix	1264.85	1272.60
Oil	Close	Previous
WTI Crude Future	48.43	48.85

Market Commentary:

NUMBER OF THE DAY
140

The approximate number of media companies and celebrities Facebook has signed contracts with to create videos for its nascent live-streaming service. The social network has agreed to make payments to video creators totaling more than $50 million.

Canada

By Eric Lam

     (Bloomberg) — Canadian stocks were little-changed for a second day, with a drop in oil prices offsetting a rally in gold producers, as investors speculated on the outcome of the U.K. referendum on European Union membership Thursday.

     The S&P/TSX Composite Index fell 0.1 percent to 14,003.81 at 4 p.m. in Toronto. The index has climbed 0.7 percent this week, poised to halt a two-week slide. The gauge is almost half a percentage point ahead of New Zealand as the top-performing developed market in the world with a 7.6 percent gain for the year, according to data compiled by Bloomberg.

     Global stocks advanced a fourth day, the longest winning streak in nearly two weeks with bookmakers’ odds now implying about a 28 percent chance Britons will vote to leave the EU. The pound touched the highest in five months before paring gains and the U.K. benchmark FTSE 100 Index has erased its losses for the month.

     “It goes without saying that we would get a huge relief rally with a ‘Remain’ vote,” David Rosenberg, Toronto-based chief economist and strategist at Gluskin Sheff & Associates Inc., said in a report to clients Wednesday. “And given how much optimism has been priced in over the past few days, a likely equally severe selloff in risk assets if the Brits do decide to leave the EU.”

     In Canada, shares of companies most exposed to the European market including Brookfield Asset Management Inc., CGI Group Inc. and Great-West Lifeco Inc. have jumped 1.4 percent so far this week, outperforming the broader S&P/TSX, according to data compiled by Bloomberg. The group of 19 stocks still trails peers in the benchmark with a 3.1 percent gain for the year.  

     Canadian retailers meanwhile are off to their best start since 2010 as retail sales jumped 0.9 percent in April on a rebound at gas stations and building-material stores to recover all the losses from a revised drop in March, according to data from Statistics Canada. Sales so far in the year are up 5.3 percent. Canadian Tire Corp. added 0.3 percent.

     Energy producers dropped 1 percent, offsetting a 1.3 percent rally in raw-materials producers as five of 10 industries in the S&P/TSX declined. Canadian Pacific Railway Ltd. added 2.9 percent after the stock was raised to a strong buy at Raymond James.

     Canadian Natural Resources Ltd. and Encana Corp. dropped more than 2 percent. Oil declined for a second day in New York as government data showed crude stockpiles dropped less than expected while imports increased.     Canadian shares remain more expensive relative to their U.S. peers. The S&P/TSX now trades at 21.5 times earnings, about 11 percent higher than the 19.3 times valuation of the S&P 500 Index.

     Raw-materials and energy producers have fueled the rebound in Canadian equities this year as the S&P/TSX stormed back into a bull market earlier this month to halt a brief bear market of less than five months. Commodities prices have bounced back led by gains in gold and a 90 percent rally in crude from the lowest levels in 12 years back in February. A gauge of raw-materials producers is up 43 percent to lead the S&P/TSX.

US

By Bailey Lipschultz and Camila Russo

     (Bloomberg) — U.S. stocks slipped amid fragile sentiment, as traders weighed the probability of the U.K. voting to remain in the European Union a day before the referendum.

     Equities lost momentum following back-to-back gains as polls released today quelled recent optimism Britain will stay in the EU. Tesla Motors Inc. sank the most in two years after offering to buy SolarCity Corp, and McDonald’s Corp. fell to a three-month low on an analyst downgrade of the stock. Energy producers slipped with oil, falling for the first time in four sessions, while the health-care group advanced as biotechnology shares rebounded.

     The S&P 500 Index declined 0.2 percent to 2,085.45 at 4 p.m. in New York, after erasing a 0.5 percent gain. The Dow Jones Industrial Average lost 48.90 points, or 0.3 percent, to 17,780.83, wiping out a 90-point climb. A gauge of volatility jumped the most since Brexit concerns escalated more than a week ago. The Nasdaq Composite Index fell 0.2 percent. About 6.3 billion shares traded hands on U.S. exchanges, 9 percent below the three-month average.

     “The markets at the moment are held hostage to the prospects of the U.K. leaving,” said Mark Luschini, chief investment strategist at Philadelphia-based Janney Montgomery Scott LLC, which manages $54 billion. “With the vote happening tomorrow, I suspect that there will be some delicate positioning in anticipation of it, but nothing particularly dramatic. I can’t envision a scenario where the markets will rally significantly. If the referendum ends up leaning toward a Brexit, those holding riskier assets would be caught.”

     The CBOE Volatility Index jumped almost 15 percent Wednesday to 21.17, erasing an early 3.5 percent drop amid renewed anxiety before Britain’s EU vote. It was the gauge’s biggest climb since a two-day, 43 percent climb almost two weeks ago. The measure of market turbulence known as the VIX is up 49 percent in June and headed toward its biggest monthly climb since a record surge in August.

     The S&P 500 fell from its highest since June 10, closing Wednesday 2.1 percent below a record set 13 months ago. After worries that the U.K. would secede spurred the gauge’s worst weekly retreat since April, polls showing the “Remain” camp gaining ground boosted shares in the prior two days. Still, it looks too close to call. While Oddschecker data show betting companies see only a roughly one-in-four chance of Britain leaving the EU, polls have been split on the outcome.

     In addition to the looming vote, concern that central-bank efforts are losing their potency, valuations stuck above the three-year average and successive quarters of declining profits weighed on stocks after the S&P 500 two weeks ago came within 0.6 percent of its all-time high. Federal Reserve Chair Janet Yellen finished two days of testimony to lawmakers after yesterday signaling a cautious and uncertain view of the economy.

     The International Monetary Fund cut its forecast for U.S.growth this year, urging the Fed to lean toward modestly overshooting its inflation target in considering whether the economy can handle higher interest rates. A report today eased some worries, as sales of previously owned homes climbed in May to the highest level in more than nine years, indicating demand for residential real estate remains robust.

     The Fed last week scaled back its projections for the pace of future interest-rate increases amid concerns about slower job gains and the U.K.’s potential EU exit. Traders have reduced their wagers on higher borrowing costs, pricing in less than even odds of a move at least until February 2017.

     “Volumes in the U.S. are pretty thin as everybody is waiting for the vote before doing anything major,” said John Plassard, a senior equity-sales trader at Mirabaud Securities in Geneva. “There might also be some short covering right before the vote as nobody would want to be short if remain wins.”

     Among the S&P 500’s 10 main industries, energy companies lost 0.6 percent, with crude sliding after U.S. government data showed stockpiles declined less than expected last week amid a jump in imports. Utilities, technology and industrial stocks also fell at least 0.3 percent. Health-care was the top performer as the group alternated between daily gains and losses for a seventh session.

     Drug developer Regeneron Pharmaceuticals Inc. rose 2 percent, ending a four-day losing streak and 10 declines in the prior 11 sessions. Celgene Corp. and Bristol-Myers Squibb Co. added more than 1.4 percent. Health-care had been the S&P 500’s worst-performing group since the benchmark hit an almost 10- month high two weeks ago. The Nasdaq Biotechnology Index rose for the second time in three days, up 0.7 percent after ending on Monday its worst losing streak since 1996.

     Marathon Oil Corp. and Anadarko Petroleum Corp. fell at least 2 percent, while Chevron Corp. lost 0.9 percent to pace declines in energy. Wednesday’s retreat halted the group’s longest winning streak in two months.

     Adobe Systems Inc. sank 5.7 percent, the most since February, to weigh on technology shares. The software company forecast revenue in the current quarter that may miss analysts’ estimates, signaling slowing momentum for its cloud-based products. HP Inc. tumbled 5.4 percent after lowering its free cash flow outlook as it reinvests proceeds from asset divestitures back into its printing business.

     FedEx Inc.’s 4.5 percent drop was the biggest drag on industrials in the benchmark. The world’s largest cargo airline fell the most in 10 months after disappointing investors by not providing more specifics on how the $4.8 billion acquisition of Dutch shipping company TNT Express will affect earnings.
 

Have a wonderful evening everyone.

 

Be magnificent!

It is quite proper to resist and attack a system but,

to resist and attack its author is tantamount to resisting and attacking oneself.

For we are all tarred with the same brush.

Mahatma Gandhi

As ever,

 

Carolann

 

Be kind, for everyone you meet is fighting a harder battle.

                                   -Plato, c.428 BCE-c. 348 BCE

 

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:

Rise up oh flame, by thy
light glowing
Bring to us beauty, vision,
and joy.
     –Christoph Praetorius

“… Regardless of any tradition, the meditative individual can immediately experience the mystery of Earth’s breathing, through the yin and yang moments of midwinter and midsummer.  To live consciously into this holy cycle instills in us a feeling for the oneness of life and bestows on us a sense of our purpose in existence.” ~John Miller.

PHOTOS OF THE DAY

People celebrate the summer solstice at the Kokino megalithic observatory near the city of Kumanovo, Macedonia, on Tuesday. Ognen Teofilvovski/Reuters

People gather to see the new dawn at the ancient stone circle Stonehenge during the Summer Solstice, the longest day of the year, in Wiltshire, England, on Tuesday. Andrew Matthews/PA/AP

 

Andean religious leaders perform a New Year’s ritual in the ruins of the ancient city of Tiwanaku, Bolivia, early Tuesday. Bolivia’s Aymara Indians are celebrating the year 5,524, as well as the Southern Hemisphere’s winter solstice, which marks the start of a new agricultural cycle. Juan Karita/AP

Market Closes for June 21^st, 2016

Market Index	Close	Change
Dow Jones	17829.73	+24.86   +0.14%
S&P 500	2088.90	+5.65   +0.27%
NASDAQ	4843.762	+6.547   +0.14%
TSX	14012.32	-2.82
		-0.02%

International Markets

Market Index	Close	Change
NIKKEI	16169.11	+203.81
		+1.28%
HANG SENG	20668.44	+158.24
		+0.77%
SENSEX	26812.78	-54.14
		-0.20%
FTSE 100	6226.55	+22.55
		+0.36%

Bonds

Bonds	% Yield	Previous  % Yield
CND. 10 Year Bond	1.252	1.206
CND. 30 Year Bond	1.884	1.838
U.S.    10 Year Bond	1.7059	1.6783
U.S. 30 Year Bond	2.5096	2.4866

Currencies

BOC Close	Today	Previous
Canadian $	0.78061	0.78099
US $	1.28104	1.28043
Euro Rate 1 Euro=		Inverse
Canadian $	1.44229	0.69334
US $	1.12587	0.88820

Commodities

Gold	Close	Previous
London Gold Fix	1272.60	1281.80
Oil	Close	Previous
WTI Crude Future	48.85	49.37

Market Commentary:

Canada

By Anna-Louise Jackson and Bailey Lipschultz

     (Bloomberg) — Canadian stocks were little changed, rebounding from losses earlier in the day, as gains by banks and energy companies offset a decline in commodities prices, while central bankers in the U.S. and Europe signaled caution about economic growth and inflation threats.

     The S&P/TSX Composite Index fell less than 0.1 percent to 14,012.32 at 4:00 p.m. in Toronto, reversing earlier declines of as much as 0.4 percent. Volume was 26 percent below the 30-day average. The index had rallied 1 percent in the preceding two sessions.

     U.S. stocks extended gains amid speculation Britain will vote to stay in the European Union, as energy producers and technology companies led the S&P 500 Index to a back-to-back gain. European shares advanced with emerging-market equities.

     Financial companies advanced 0.6 percent, as Royal Bank of Canada added 0.9 percent, extending a rally to four sessions. Toronto-Dominion Bank climbed 0.8 percent, its largest in almost a month.

     Energy producers added 0.6 percent as oil pared losses, while TransCanada Corp. advanced 2.2 percent, the most since March 30.

     Trican Well Service Ltd. jumped 9.5 percent, for the highest close since August, after Royal Bank analyst Dan MacDonald raised his rating for the stock to the equivalent of a buy, from sector perform or a hold. He also more than doubled his price target for the stock, to C$5 from C$2, with Trican’s financial risk now seen as “greatly” reduced after a reboot of its balance sheet, he said in a note.

     Shares of raw-materials producers tumbled 1.9 percent, along with a similar retreat in gold prices. Barrick Gold Corp. slumped 3 percent, its biggest drop in almost a month, while Franco-Nevada Corp. fell 2.8 percent, sliding for a third session.

     Industrial companies tumbled 0.9 percent. Canadian Pacific Railway Ltd. fell 2.3 percent, with its lowest close since February, after the company cut its revenue outlook. Canadian National Railway Co. also declined 0.9 percent.

     Health-care stocks dropped 2.5 percent, slumping 19 percent so far in June, poised for a second monthly loss. The group is trading at the lowest level on a closing basis since December 2010.

US

By Oliver Renick and Bailey Lipschultz

     (Bloomberg) — U.S. stocks advanced amid speculation Britain will vote to stay in the European Union, as energy producers and technology companies led the S&P 500 Index to a back-to-back gain.

     Equities climbed after zigzagging throughout the day, bolstered by a third-straight increase for oil and gas companies, the longest in two months even as crude prices dropped. Microsoft Corp. rallied 2.2 percent and Apple Inc. added 0.9 percent to lead technology shares higher. Falling biotechnology stocks dragged down the health-care group, and raw-materials companies slipped as the dollar rose for the first time in five sessions to weigh on commodities prices.

     The S&P 500 climbed 0.3 percent to 2,088.90 at 4 p.m. in New York, bringing its two-day gain to 0.9 percent. The Dow Jones Industrial Average rose 24.86 points, or 0.1 percent, to 17,829.73. The Nasdaq Composite Index also added 0.1 percent, erasing an earlier 0.2 percent retreat. About 6.2 billion shares traded hands on U.S. exchanges, 10 percent below the three-month average.

     “This is very much like the Greece situation, every time a poll comes out about what’s leading Brexit, you see a slight shift in the market that way,” said Michael Antonelli, an institutional equity sales trader and managing director at Robert W. Baird & Co. in Milwaukee. “Nothing is going to happen until the vote. Janet Yellen spoke today and it got cursory coverage and interest from the people I spoke with.”

     Federal Reserve Chair Janet Yellen signaled more caution on the economic outlook in testimony today before lawmakers, saying she and her colleagues were on watch for whether, rather than when, the economy would show clear signs of improvement. Yellen said the prospect of slow productivity growth continuing “into the future” can’t be ruled out, while also mentioning several potential threats to the economy from outside the U.S., including those from uncertainty over China’s expansion and the Brexit vote.

     The central bank last week signaled a cautious approach to future rate hikes, scaling back its projections for the next two years. Traders have since cut back their bets on higher borrowing costs, not pricing in even odds for an increase until February 2017.

     “I’m hearing a dovish tone,” said Thomas Garcia, head of equity trading at Thornburg Investment Management Inc. in Santa Fe, New Mexico. “At this point I don’t think anyone thinks she will raise rates. Investors aren’t going to be doing too much in front of Brexit, and I think Yellen is being careful of what she says in front of it as well.”

     The S&P 500 added to a bounce from the gauge’s worst weekly drop since April, a slide spurred by worries that Britain would secede. That halted a run-up from late May to within 0.6 percent of an all-time high on June 8, in an area above the 2,100 level where previous rallies have faltered in the past year. The index advanced yesterday after polls showed the U.K. campaign to stay in the EU gaining ground, and closed Tuesday less than 2 percent from its record set 13 months ago.

     Speculation that central banks’ efforts to boost global growth are losing their potency, valuations stuck above the three-year average and successive quarters of falling profits have added to the recent hurdles for stocks, as well as anxiety over the looming U.K. vote. The Fed last week painted a mixed picture on the U.S. economy, giving investors second thoughts on whether growth will remain strong enough to support higher equity prices.

     Despite recent optimism that Britons will opt to stay in the EU, the referendum remains too close to call. New polls were split: A YouGov poll for the Times newspaper published late Monday showed a lead for the “Leave” campaign, while a survey by ORB for the Daily Telegraph indicated “Remain” was ahead. Still, odds at betting shops showed only about a one-in-four chance Britain will choose to secede, though they crept up slightly Tuesday.

     “The polls are taking effect and everybody’s washing out the negativity from last week,” Michael Block, chief strategist at Rhino Trading Partners LLC in New York, said by phone. “Soros was out overnight warning the pound will be down 20 percent so people keep trying to get short and they keep burning their fingers. There’s dysfunction otherwise and not a lot of fundamental conviction out there.”

     In Tuesday’s trading, energy, technology and phone companies were the strongest performers among the S&P 500’s 10 main industries, increasing more than 0.6 percent. Raw- materials, health-care and consumer discretionary shares slipped at least 0.2 percent. The CBOE Volatility Index rose 0.6 percent to 18.48. The measure of market turbulence known as the VIX is up 30 percent this month, the most since a record surge in August.

     Marathon Oil Corp. and Kinder Morgan Inc. rallied more than 3.8 percent for the best gains in energy as 36 of 38 members advanced. Halliburton Co. gained 1.9 percent. Meanwhile, crude futures lost 1.1 percent as markets awaited U.S. stockpile data and the Brexit vote.

     Phone companies in the benchmark rose to the highest since October 2007, with CenturyLink Inc. gaining 1.9 percent to a five-week high. Verizon Communications Inc. and AT&T Inc. advanced more than 0.6 percent.

     Microsoft’s biggest gain in almost a month back-boned the tech group’s third climb in four days. Symantec Corp. increased 2.2 percent, extending a rally to seven sessions, its longest in almost two years. Red Hat Inc. added 1.9 percent before its earnings report tomorrow, and Adobe Systems Inc. rose 1.8 percent.

     Airlines rallied for a third consecutive day. United Continental Holdings Inc. advanced 3.4 percent after the carrier said it will find $3.1 billion in savings and extra revenue by 2018 as it attempts to close a persistent profit gap with competitors. Alaska Air Group Inc. and Delta Air Lines Inc. added more than 1.5 percent.

     Celgene Corp. and Allergan Plc lost at least 1.5 percent as a slump in biotechs sent the health-care group lower. Regeneron Pharmaceuticals Inc. continued its two-week slide, dropping 2.1 percent to its lowest price since October 2014. The shares have posted declines in 10 of the last 11 sessions.

 

Have a wonderful evening everyone.

 

Be magnificent!

To slight a single human being is to slight those divine powers

and thus harm not only that being but with him the whole world.

Mahatma Gandhi

 

As always,

 

Carolann

 

If we could sell our experiences for what they cost us,

we’d all be millionaires.

                              -Abigail Van Buren, 1918-2013

 

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:

Summer Solstice today!

In summer, the song sings itself. –William Carlos Williams

Sumer is icumen in,
Lhude sing cuccu!
Groweth sed, and bloweth me [meadow]
And springeth the wude nu.
              Anonymous, Cuckoo Song (c. 1250)

SUMMER TIME: The idea of making fuller use of the hours of daylight by advancing the clock originated with Benjamin Franklin (1706-90), but its introduction was due to its advocacy from 1907 by William Willett (1856-1915), a Chelsea builder.  It was adopted in 1916 in Germany, then in Britain as a wartime measure, when clocks were advanced by one hour.  In Britain it became permanent by an Act of 1925.  Summer Time began on the day following the third Saturday in April, unless that was Easter Day, in which case it was the day following the second Saturday in April.  It ended on the day following the first Saturday in October.  In 1961 Summer Time was extended by six weeks, beginning March and ending in October, and similar extensions were made in 1962 and subsequent years.  During the Second World War  it ran from 25 February to 31 December in 1940 and from 1 January in the four years from 1941.  In  1945 it ended in October.  Double Summer Time (i.e. two hours in advance of GMT instead of one) was in force from 1941 to 1945 and in 1947 to save fuel.  After the war Summer Time was in force in the years from 1948 to 1952 and 1961 to 1964.  From 27 October 1968 until 31 October 1971 clocks were kept one hour ahead of GMT continuously.  This was known as British Standard Time (BST).   The most recent legislation is the Summer Time Act of 1972, which enacted that Summer Time should begin at 2 o’clock GMT in the morning of the day after the third Saturday in March or, if that is Easter Day, the day after the second Saturday in March and that it should end at 2 o’clock GMT in the morning of the day after the fourth Saturday in October.  Since the Second World War a number of other countries have adopted some form of Summer Time. –Brewer’s Dictionary of Phrase & Fable.

June 20:

1837 – Queen Victoria ascends throne at age 18 after the death of her uncle, William IV.

1877 – Great Fire of Saint John destroys business district, 1,612 houses (2/3 of housing); kills 19, leaves 15,000 homeless.

PHOTOS OF THE DAY

The full moon rises behind a tree next to the ancient marble Temple of Poseidon at Cape Sounion, southeast of Athens, on the eve of the summer solstice on Monday. The temple, built in 444 BC, was dedicated to Poseidon, god of the sea. Petros Giannakouris/AP

A close-up of the head of ‘Cyber Horse,’ made from thousands of infected computer and cell phone bits, is on display at the entrance to the annual Cyberweek conference at Tel Aviv University in Israel on Monday. Amir Cohen/Reuters

A man jumps over a puddle outside Victoria Station as heavy rain falls in London on Monday. Monday marks the Summer Solstice – the longest day of the year and the astronomical change of seasons when days are longest and nights are shortest in the Northern Hemisphere. Lauren Hurley/PA/AP

Market Closes for June 20^th, 2016

Market Index	Close	Change
Dow Jones	17804.87	+129.71   +0.73%
S&P 500	2083.25	+12.03   +0.58%
NASDAQ	4837.215	+36.876   +0.77%
TSX	14015.14	+113.37
		+0.82%

International Markets

Market Index	Close	Change
NIKKEI	15965.30	+365.64
		+2.34%
HANG SENG	20510.20	+340.22
		+1.69%
SENSEX	26866.92	+241.01
		+0.91%
FTSE 100	6204.00	+182.91
		+3.04%

Bonds

Bonds	% Yield	Previous  % Yield
CND. 10 Year Bond	1.206	1.122
CND. 30 Year Bond	1.838	1.768
U.S.    10 Year Bond	1.6783	1.6095
U.S. 30 Year Bond	2.4866	2.4203

Currencies

BOC Close	Today	Previous
Canadian $	0.78099	0.77588
US $	1.28043	1.28886
Euro Rate 1 Euro=		Inverse
Canadian $	1.44876	0.69025
US $	1.13146	0.88381

Commodities

Gold	Close	Previous
London Gold Fix	1281.80	1290.70
Oil	Close	Previous
WTI Crude Future	49.37	47.98

Market Commentary:

Canada

By Anna-Louise Jackson and Bailey Lipschultz

     (Bloomberg) — Canadian stocks advanced the most in five weeks, joining a rally in global equities, as energy producers followed crude higher and financial shares had their best gains in a month.

     The S&P/TSX Composite Index rose 0.8 percent percent to 14,015.14 at 4 p.m. in Toronto, the most since May 16, with all 10 main industries in the benchmark gaining. The gauge rebounded after falling for second straight week, down 1 percent. A report in Canada showed wholesale sales rose 0.1 percent in April, less than the 0.5 percent forecast.

     Global equities surged, with the pound strengthening the most since 2008, on signs the campaign for the U.K to stay in the European Union was gaining momentum before this week’s referendum. Canadian stocks have climbed 7.7 percent this year, second only among developed nations to New Zealand’s 8.6 percent gain.

     Energy companies rallied with oil as West Texas Intermediate crude futures traded above $49 a barrel. Enbridge Inc. rose 2.2 percent, while Cenovus Energy Inc. added 3.1 percent. Crew Energy Inc. and Baytex Energy Corp. posted the strongest gains, up more than 6.6 percent.

     Financial stocks added 0.7 percent, the most since May 24. Alaris Royalty Corp. jumped 4.4 percent and Great-West Lifeco Inc. rose 2.4 percent, the best for both in four months. Brookfield Asset Management Inc. fell 0.3 percent after the company said it has completed the spin off of Business Partners LP. The company’s private equity arm tumbled 18 percent in its first regular trading session.

     Technology companies gained 0.8 percent, with Kinaxis Inc. adding 3.5 percent, its biggest rally in a month. Open Text Corp. increased 2.8 percent, snapping a four-day decline of 1.6 percent.

     Raw-materials companies rallied 0.3 percent, even as gold prices slipped for a second straight day. First Quantum Minerals Ltd. and Lucara Diamond Corp. both added at least 4.8 percent. Kinross Gold Corp. fell 2.2 percent as the company temporarily suspends mining and processing operations at its Tasiast mine in Mauritania. Barrick Gold Corp. lost 2 percent and fell for a third day.

US

By Oliver Renick

     (Bloomberg) — U.S. stocks climbed, with the S&P 500 Index rising the most in almost four weeks, after the latest polls showed the U.K. campaign to remain in the European Union is gaining ground before Thursday’s referendum.

     Monday’s rebound was paced by gains in consumer discretionary, industrial and technology shares. Amazon.com Inc. and Priceline Group Inc. advanced more than 1 percent to bolster consumer companies. Banks moved higher amid a steep increase in Treasury yields as investors abandoned haven assets, with Bank of America Corp. and Goldman Sachs Group Inc. up more than 1 percent.

     The S&P 500 rose 0.6 percent to 2,083.25 at 4 p.m. in New York, though it trimmed gains in the final hour before the looming U.K. vote and testimony tomorrow by Federal Reserve Chair Janet Yellen. The gauge had climbed as much as 1.4 percent. The Dow Jones Industrial Average rallied 129.71 points, or 0.7 percent, to 17,804.87. The Nasdaq Composite Index increased 0.8 percent, recovering from the lowest since May 23.

     “We’re kind of going back to that risk-on again — it’s more an unwind of the panic we saw last week in the VIX up at 22 and the bond buying, and it seems to be because of what’s changing in the vote,” Mark Kepner, a managing director and equity trader at Themis Trading LLC in Chatham, New Jersey, said by phone. “The market was starting to prepare for a Brexit and it seems the polls in the U.K have changed since late last week.”

     A poll published over the weekend showed 45 percent of voters supported the ‘Remain’ camp, while 42 percent were in favor of a so-called Brexit — a turnaround from early last week, when a slew of surveys put the latter group ahead. Odds at betting shops also suggested dwindling support for the ‘Leave’ camp following Thursday’s murder of U.K. lawmaker Jo Cox, who backed staying in the EU.

     The S&P 500 bounced Monday after falling in six of the past seven sessions, a stretch that followed a climb to within 0.6 percent of its all-time high on June 8. The benchmark posted its worst weekly retreat since April amid global anxiety that Britain will choose to secede and central banks’ efforts to boost growth are losing their potency.

     Valuations stuck above the three-year average and four quarters of falling profits have also added to the recent hurdles for stocks. The S&P 500 briefly sprang back near 2,100 today, a level that’s proved difficult to hold above in other rallies during the past year, and closed 2.2 percent from its record set 13 months ago.

     The CBOE Volatility Index fell 5.4 percent today to 18.37, paring an early drop of nearly 15 percent. The measure of market turbulence known as the VIX capped a third consecutive weekly climb on Friday, the longest in five months. About 6.7 billion shares traded hands on U.S. exchanges, 3 percent below the three-month average.

     The Fed last week signaled a cautious approach to future rate increases, scaling back its projections for the next two years. Yellen and her fellow policy makers reiterated rates are likely to rise at a “gradual” pace. The Fed chair will testify on monetary policy before lawmakers Tuesday and Wednesday in a semiannual report. Traders have cut back their bets on higher borrowing costs, pricing in less than even odds for an increase as late as February 2017.

     “Last week, the positioning got a little bit too bearish, and now we are seeing a readjustment of that,” said Michael Hewson, a market analyst at CMC Markets in London. “People are talking about the slight shift in the betting odds with respect to this week’s U.K. vote. Brexit is a risk, but is it going to bring the global economy crashing down? No. When you get stretched too far in one direction, don’t be surprised it’s like an elastic band — you pull it, pull it, pull it, and it snaps.”

     Among the S&P 500’s 10 main industries Monday, energy, industrial and consumer discretionary shares rose at least 0.8 percent, while technology and financial companies added more than 0.5 percent. Utilities slipped 0.4 percent, shaving an earlier 1.1 percent drop.

     Auto-parts makers were the biggest gainers in consumer discretionary, with Delphi Automotive Plc and BorgWarner Inc. climbing more than 3.7 percent, the best for both since April. Federal-Mogul Holdings Corp. jumped as much as 9 percent after Carl Icahn raised his bid for the remaining 18 percent of the parts maker.

     Travel-related companies surged, with Expedia Inc. joining Priceline and TripAdvisor Inc. with increases of more than 2.5 percent following an upgrade to the equivalent of buy from neutral at Atlantic Equities LLC. Royal Caribbean Cruises Ltd. and Carnival Corp. added at least 1.4 percent. A Wells Fargo analyst said cruise lines have underperformed amid concerns over the Brexit referendum, and are the best way in the leisure industry to play a “stay” vote.

     Boeing Co. advanced 2.3 percent toward a five-week high, contributing to industrials’ longest rally in two months. The aircraft maker is nearing a $4 billion deal with Russia’s largest air-freight company that would help extend the life of the iconic, hump-nosed 747 jumbo jet, people close to the transaction said. General Electric Co. and 3M Co. added at least 1.2 percent. FedEx Corp. gained 1.4 percent. The delivery company said it will buy six Boeing 767 freighters valued at $1.2 billion.

     Technology shares rose 0.5 percent, cutting the day’s best gains by two-thirds. Semiconductors were the strongest members of the group, rallying the most since May 24, with Skyworks Solutions Inc. and Qorvo Inc. rallying more than 2.7 percent. Intel Corp. advanced 1.3 percent. Also among tech companies, EBay Inc. jumped 3.3 percent, its best one-day gain in 10 weeks.

     Among stocks moving on corporate news, Marathon Oil Corp. soared 10 percent, its greatest gain in two months after saying it will buy PayRock Energy Holdings for $888 million. Marathon’s climb led energy producers as West Texas Intermediate crude futures increased as much as 2.9 percent amid speculation the U.K. will vote to remain in the EU. Chevron Corp. added 1 percent and Devon Energy Corp. climbed 3.7 percent.

     WellCare Health Plans Inc. rose to its highest since October 2007, with its 3.6 percent increase helping to boost the Russell 2000 Index to its best day in nearly a month. The climb comes after a Wall Street Journal report said Justice Department officials may be questioning the merger of Anthem Inc. and Cigna Corp., making WellCare a potential target. Rival managed-care companies Centene Corp. and Molina Healthcare Inc. Advanced at least 1.9 percent.

 

Have a wonderful evening everyone.

 

Be magnificent!

When you have an ideal will you think it helps rid you of  “what is,” but it never does.

You may preach non-violence for the rest of your life

and all the time be sowing the seeds of violence.

Krishnamurti

As ever,
 

Carolann

 

He hath awakened from the dream of life-

‘tis we, who lost in stormy visions, keep

with phantoms an unprofitable strife.

        -Percy Bysshe Shelley, 1792-1822

 

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 Father’s Day!

HE WISHES FOR THE CLOTHS OF HEAVEN
William Butler Yeats

Had I the heavens’ embroidered cloths,
Enwrought with golden and silver light,
The blue and the dim and the dark cloths
Of night and light and the half-light,
I would spread the cloths under your feet:
But I, being poor, have only my dreams;
I have spread my dreams under your feet;
Tread softly because you tread on my dreams.

PHOTOS OF THE DAY

Racegoers in top hats watch a horse race during Royal Ascot at the Ascot Racecourse in England on Friday. Andrew Boyers/Reuters

Ferrari driver Sebastian Vettel of Germany steers his car during his second free practice session at the Baku circuit in Azerbaijan on Friday. The Formula One Grand Prix of Europe will be held on Sunday. Luca Bruno/AP

Market Closes for June 17^th, 2016

Market Index	Close	Change
Dow Jones	17674.34	-58.76   -0.33%
S&P 500	2070.92	-7.07   -0.34%
NASDAQ	4800.340	-44.575   -0.92%
TSX	13939.40	+56.99
		+0.41%

International Markets

Market Index	Close	Change
NIKKEI	15599.66	+165.52
		+1.07%
HANG SENG	20169.98	+131.56
		+0.66%
SENSEX	26625.91	+100.45
		+0.38%
FTSE 100	6021.09	+70.61
		+1.19%

Bonds

Bonds	% Yield	Previous  % Yield
CND. 10 Year Bond	1.122	1.107
CND. 30 Year Bond	1.768	1.760
U.S.    10 Year Bond	1.6095	1.5788
U.S. 30 Year Bond	2.4203	2.3963

Currencies

BOC Close	Today	Previous
Canadian $	0.77588	0.77133
US $	1.28886	1.29647
Euro Rate 1 Euro=		Inverse
Canadian $	1.45348	0.68800
US $	1.12773	0.88674

Commodities

Gold	Close	Previous
London Gold Fix	1290.70	1310.75
Oil	Close	Previous
WTI Crude Future	47.98	46.21

Market Commentary:

Canada

By Anna-Louise Jackson

     (Bloomberg) — Canadian stocks advanced for the second time in nine days, mirroring a rebound in oil and global equities after campaigning in Britain’s referendum on European Union membership was suspended.

     The S&P/TSX Composite Index advanced 0.1 percent to 13,901.77 as of 4 p.m. in Toronto. Three of the gauge’s 10 main industries rose, led by energy companies, which snapped a three- day selloff. A report today showed inflation in the country eased in may as food costs rose at the slowest pace in more than two years.

     While global stocks rebounded from a four-week low, U.S. equities retreated. The Canadian dollar snapped the longest steak of losses since January.

     Oil prices jumped the most in two months, helping buoy shares of energy companies. The group added 0.9 percent, as Enerplus Corp. surged 7.1 percent and Baytex Energy Corp. advanced 5 percent.

     Shares of raw-materials pared an earlier rally, closing 0.1 percent higher. Nevsun Resources Ltd. slumped 9.7 percent to a four-month low after it sweetened a bid for Reservoir Minerals Inc., a takeover bid that shareholders voted to accept on Friday. Turquoise Hill Resources 17 percent over five days after reports emerged earlier this week that its controlling shareholder Rio Tinto Group is looking into taking the Vancouver-based company private.

     Health-care stocks extended a three-day selloff to the lowest level since December 2010, as Concordia Healthcare Corp. slumped to a two-year low. Meanwhile, shares of utilities companies fell 1.6 percent, the most since February, led by Innergex Renewable Energy Inc.’s 4.3 percent slump.

US

By Oliver Renick and Bailey Lipschultz

     (Bloomberg) — U.S. stocks retreated, sending the S&P 500 Index lower for the sixth time in seven days, amid selling in health-care and technology shares that have been the market’s weakest all year.

     Apple Inc. posted its biggest slide in five weeks, dragging down the tech group after regulators in China said the latest IPhones violated a design patent of a Chinese company. Google parent Alphabet Inc. and Merck & Co. fell more than 2.7 percent, while the Nasdaq Biotechnology Index slid 2 percent to mark the longest losing streak in 20 years. Commodity shares rallied with crude oil, helping to lift equities off the worst levels of the day.

     The S&P 500 declined 0.3 percent to 2,071.22 at 4 p.m. in New York, resuming a slide after rising Thursday to halt the longest stretch of losses since February. The gauge posted the second consecutive weekly drop, falling 1.2 percent. The Dow Jones Industrial Average lost 57.94 points, or 0.3 percent, to 17,675.16. The Nasdaq Composite Index sank 0.9 percent to the lowest since May 23.

     “The market is nervous about valuations in general, they’re still nervous about the Fed and what they’re going to do, and what Europe is going to do,” Thomas Garcia, head of equity trading at Thornburg Investment Management Inc. in Santa Fe, New Mexico, said by phone. “There’s a lot more to worry about than just Brexit. We just can’t break these levels either way, and we’re just trading in a range.”

     About 9.1 billion shares traded hands on U.S. exchanges, 30 percent above the three-month average after a quarterly event known as quadruple witching, when futures and options contracts on indexes and individual stocks expire. Some of the biggest instruments for protection against losses in equities rolled over just a few days before the U.K.’s referendum on secession, an event that forces would-be hedgers to take up new positions.

     Equities were whipsawed Thursday, erasing losses that had reached 1 percent, after both sides on the Brexit issued suspended their campaigns following the murder of Labour Party lawmaker Jo Cox, who was a “Remain” proponent. The event shifted investor sentiment after a series of polls in recent days indicated more Britons favor leaving the EU. Stocks in Europe rose Friday as Brexit concerns abated and energy shares followed oil higher.

     “When you look at the difference in markets between the U.S. and Europe, for the past week the U.S. has gone down significantly less than Europe,” said Walter Todd, who oversees about $1.1 billion as chief investment officer for Greenwood Capital Associates LLC in South Carolina. “So you may just be seeing a relief rally in Europe, and even with the U.S. down it’s still outperforming international markets for the past week.”

     Bookmakers’ odds today indicated a lower chance of the “Leave” side winning. Federal Reserve Chair Janet Yellen and central banks in Britain, Japan, Canada and Switzerland have warned this week over the potential for economic damage in the event of a secession.

     Meanwhile, investors have been bracing for turbulence like never before. Trading volume for securities linked to the CBOE Volatility Index surged to a record high this week. The measure of market turbulence known as the VIX edged up 0.2 percent Friday to 19.41, bringing its monthly gain to about 37 percent, on track for the most since August.

     Concern that Britain will exit the union, and thereby weaken the global economy, has weighed on financial markets ahead of the June 23 vote, with the S&P 500 headed for its biggest weekly decline since April. Investors were also unnerved by a mediocre growth outlook implied by Yellen’s dovishness after Wednesday’s Fed meeting, as well as a lack of action from other prominent central banks that fueled perceptions policy makers are increasingly at a loss about what to do in the face of a struggling global economy.

     A report today showed new-home construction in the U.S. was little changed in May, a sign the residential real-estate industry’s contribution to economic growth in the second quarter will be muted. The chances of a July boost in borrowing costs have fallen to 6 percent, from about 16 percent before the Fed this week scaled back its projections for increases. Odds of a move only rise to about 40 percent for as late as February 2017.                        

     The S&P 500 has slipped 2.3 percent since June 8 when the benchmark came within 0.6 percent of its record set almost 13 months ago. Brexit worries have stymied the latest run toward the all-time high after the gauge rallied as much as 16 percent from a 22-month low in February, boosted by crude’s recovery from a 12-year low and optimism that a mix of low rates and moderate economic growth would continue to support higher share prices.

     In Friday’s trading, five of the S&P 500’s 10 main industries declined, with health-care and technology companies dropping at least 0.9 percent. Consumer staples, one of yesterday’s rally leaders, retreated 0.5 percent. Energy stocks rose 0.8 percent, while raw-materials and phone companies climbed at least 0.4 percent.

     Merck saw the steepest slide in four months amid analyst comments on sales for a hepatitis drug. That combined with a ninth consecutive decline for biotechnology shares to send the health-care group to the worst day in more than a month. Pfizer Inc. and Bristol-Myers Squibb Co. lost more than 1.4 percent.

     Alphabet slumped to the lowest in nearly two months, joining Apple as the biggest drivers of losses in tech, following comments on search trends from Citigroup Inc. Activision Blizzard Inc. and Visa Inc. fell more than 1.7 percent. Offsetting some of the declines in the group, Oracle Corp. added 2.7 percent after reporting sales that topped analysts’ estimates as cloud-based products picked up momentum with corporate customers.

     Energy shares rallied to halt a seven-day drop, the longest since August. Crude jumped the most in two months, rising 3.8 percent as a weaker dollar bolstered the appeal of commodities. Murphy Oil Corp. added 4.9 percent, and Transocean Ltd. gained 7.5 percent.

     Among other shares moving on corporate news, Revlon Inc. advanced the most since February after a deal to acquire Elizabeth Arden Inc. for about $419 million, a wager that uniting two aging cosmetics giants can reinvigorate both companies’ brands. Elizabeth Arden Inc. surged 49 percent.

     Smith & Wesson Holding Corp. jumped 8.7 percent, its best day in five months, after predicting firearm demand would hold strong — regardless of any fallout from the mass shooting in Florida — and two research firms upgraded the shares. The company’s quarterly results also beat estimates.

     Lumber Liquidators Holdings Inc. soared 19 percent, the steepest climb this year, after regulators ended a probe of formaldehyde in the company’s flooring without issuing a product recall.
 

Have a wonderful weekend everyone.

 

Be magnificent!

Propaganda can never tell the truth; truth can never be propagated.

Krishnamurti

As ever,

 

Carolann

 

Real riches are the riches possessed inside.

                         -B.C. Forbes, 1880-1954

 

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:

On June 16, 1815, Thomas Creevey wrote from Brussels in his Journal:

Friday morning, half-past two – The girls just returned from a ball at the Duke of Richmond’s.  A battle has taken place today [at Charleroi on 15 June] between Bonaparte and the Prussians; to what extent is not known, however, to be in favour of the French.  Our troops are all moving from this place at present.  Lord Wellington was at the ball tonight as composed as ever.

PHOTOS OF THE DAY

A woman walks on the installation ‘The Floating Piers,’ by Bulgarian-born artist Christo Vladimirov Yavachev, known as Christo, on Lake Iseo in northern Italy on Thursday. Stefano Rellandini/Reuters

Robot ‘Pepper,’ a humanoid robot designed to welcome and take care of visitors and patients, holds the hand of a newborn baby at AZ Damiaan hospital in Ostend, Belgium, on Thursday. Francois Lenoir/Reuters

Market Closes for June 16^th, 2016

Market Index	Close	Change
Dow Jones	17733.10	+92.93   +0.53%
S&P 500	2077.99	+6.49   +0.31%
NASDAQ	4844.914	+9.982   +0.21%
TSX	13882.41	-41.04
		-0.29%

International Markets

Market Index	Close	Change
NIKKEI	15434.14	-485.44
		-3.05%
HANG SENG	20038.42	-429.10
		-2.10%
SENSEX	26525.46	-200.88
		-0.75%
FTSE 100	5950.48	-16.32
		-0.27%

Bonds

Bonds	% Yield	Previous  % Yield
CND. 10 Year Bond	1.107	1.081
CND. 30 Year Bond	1.760	1.759
U.S.    10 Year Bond	1.5788	1.5737
U.S. 30 Year Bond	2.3963	2.4087

Currencies

BOC Close	Today	Previous
Canadian $	0.77133	0.77467
US $	1.29647	1.29087
Euro Rate 1 Euro=		Inverse
Canadian $	1.45547	0.68706
US $	1.12265	0.89075

Commodities

Gold	Close	Previous
London Gold Fix	1310.75	1283.30
Oil	Close	Previous
WTI Crude Future	46.21	48.01

Market Commentary:

Canada

By Anna-Louise Jackson

     (Bloomberg) — Canadian stocks slid for the sixth time in seven days, erasing Wednesday’s gain as commodity producers followed crude-oil and metals prices lower.

     The S&P/TSX Composite Index fell 0.3 percent to 13,882.41 at 4 p.m in Toronto, paring an earlier 0.8 percent retreat as U.S. stocks rebounded amid diminished odds Britain will elect to leave the European Union. Seven of the gauge’s 10 main industries declined. Gold prices slumped after touching a nearly two-year high, dragging down raw-materials companies which erased an earlier 2 percent advance. The benchmark has slumped 3.4 percent since hitting a 10-month high on June 7.

     The S&P 500 Index wiped out all of a 1 percent drop, while futures on the Euro Stoxx 50 gained amid a steady intraday easing in bookmaker odds for the U.K. exiting the EU. Campaigning for the Brexit referendum was suspended by both sides after Labour Party lawmaker Jo Cox was murdered as she met constituents in her district.

     Shares of health-care companies led the decline in Canada’s market, falling 3.4 percent to the lowest since December 2010. Valeant Pharmaceuticals International Inc. tumbled again, losing 5.1 percent to bring its two-day decline to 6.2 percent.

     After rising as much as 2.1 percent earlier in the day to briefly touch a 16-month high, raw-materials stocks tumbled along with gold prices to close 1.4 percent lower. OceanaGold Corp. soared to an all-time high before closing 0.9 percent lower. Kinross Gold Corp. and Alamos Gold Inc. both tumbled at least 4.1 percent, the most in about four weeks.

     As oil prices slumped, so did energy stocks with the group sinking 0.8 percent. Cenovus Energy Inc. lost 3.6 percent to a two-month low, while Surge Energy Inc. and Baytex Energy Corp. both fell at least 5.5 percent. West Texas Intermediate crude futures declined 3.8 percent in New York, capping the commodity’s longest losing streak since February, as concerns mounted that the world economy is losing strength.

     Financials snapped a six-day selloff, rising 0.2 percent led by a rally of 1.3 percent for Dream Office Real Estate Investment Trust. Meanwhile, phone companies added to a three- day rally of 1.9 percent as Roger Communications Inc. jumped 1.6 percent, the most since February.

US

By Joseph Ciolli and Anna-Louise Jackson

     (Bloomberg) — U.S. stocks rebounded, with the S&P 500 Index halting its longest losing streak since February, amid shifting speculation on whether Britain will remain in the European Union.

     Equities recovered from a 1 percent selloff as both sides suspended campaigning on whether Britain should leave the EU after Labour Party lawmaker Jo Cox was murdered while she met constituents in her electoral district. She was in favor of remaining in the EU, fueling speculation voters will be more likely to choose remain in next week’s referendum. Phone companies and utilities led the rally, while energy producers were mired in the longest retreat in almost 10 months as crude continued to fall.

     The S&P 500 rose 0.3 percent to 2,077.99 at 4 p.m. in New York, ending a five-day, 2.3 percent retreat. The gauge also climbed back above its average price during the past 50 days. It was the fifth time this year the benchmark has erased a 1 percent intraday drop to finish higher. The Dow Jones Industrial Average surged 92.93 points, or 0.5 percent, to 17,733.10, after wiping out a 168-point slide. The Nasdaq Composite Index added 0.2 percent.

     “Recent polls have shown Brexit is too close to call, or leaning in the direction of leaving,” said Mark Luschini, chief investment strategist at Philadelphia-based Janney Montgomery Scott LLC, which manages $54 billion. “That campaign cooling a bit could provide relief to investors that think further campaigning will help drive votes in the direction of a Brexit. How sticky of a sentiment that will be is yet to be determined.”

     Traders noted the rebound in equities coincided with a deterioration in chances Britons would elect to leave the EU as tracked by Oddschecker’s survey of bookmakers’ implied probability. Those odds slipped below 38 after surpassing 44 hours earlier. Others said a rebound in markets was unsurprising given how fast stocks fell at the open, with the S&P 500 going as low as 2,050.37, roughly where it began a 1.4 percent rally on May 24.

     The CBOE Volatility Index fell 3.8 percent to 19.37, after jumping almost 14 percent. The measure of market turbulence known as the VIX slipped for a third day after reaching on Monday its highest since Feb. 23. About 7.4 billion shares traded hands on U.S. exchanges, 6 percent above the three-month average.

     Investors also shrugged off mounting anxiety over the growth outlook after the Federal Reserve yesterday scaled back its projections for interest-rate increases. Policy makers indicated the economy remains mixed, and also cited Britain’s June 23 EU referendum as a factor in the decision to stand pat. Chair Janet Yellen pointed to more permanent forces that could hold down rates for longer, namely slow productivity growth and aging societies.

     The Bank of Japan refrained from expanding monetary stimulus ahead of a domestic election and the U.K.’s June 23 Brexit vote, while the Swiss National Bank and Bank of England also kept rates unchanged.

     Equities found a reprieve in a retreat spurred as investors weighed the potential fallout from the U.K. referendum, with a series of polls in recent days indicating more Britons favor leaving the EU. Sentiment has soured from just a week ago, when the S&P 500 rose to within 0.6 percent of a record on optimism that a mix of low rates and moderate economic growth would continue to support higher stock prices. The gauge had rallied as much as 16 percent from a 22-month low in February.

     “I wouldn’t be surprised if everything was just put on hold for a while,” said Tim Ghriskey, who oversees $1.5 billion as managing director and chief investment officer at Solaris Asset Management. “The possibility of a delay in the Brexit vote is probably letting the market seemingly lift a little bit and retrace most of today’s losses.”

     Central banks have sounded the alarm over a potential Brexit, with chiefs of the Fed, Bank of Japan, Bank of Canada and Swiss National Bank all citing next week’s vote as a potential disruption to the global economy. Yellen said yesterday the decision could have consequences for financial markets, and “in turn for the U.S. economic outlook.” Traders have cut back their bets on a Fed rate increase, pricing in only a 6 percent chance of a July boost and less than 40 percent odds of one as late as February 2017.                          

     While policy makers still aren’t seeing enough momentum in the economy to warrant higher borrowing costs, a report today showed the cost of living in the U.S. excluding food and fuel rose in May, propelled by rising rents. Separately, jobless claims increased more than expected last week, reflecting a jump in California that otherwise masked steady progress in the labor market. Another gauge showed confidence among homebuilders climbed to a five-month high in June.

     “There’s been a subtle shift in terms of what the market is rewarding — from previously having rewarded low rates and more liquidity to now being seen to reward an increase in rates because of the implications for confidence and economic activity,” said Daniel Murray, the London-based head of research at EFG Asset Management. “The Fed has done quite a quick turn. Clearly the uncertainty over Brexit is rising. Markets are trying to digest all of this.”

     In Thursday’s trading, phone companies and utilities — the two groups with the most generous dividend yields — were the strongest performers among the S&P 500’s 10 main industries. Energy companies pared their drop to 0.2 percent from more than2 percent, even as West Texas Intermediate crude futures fell 3.8 percent to cap the longest selloff since February.

     Consumer staples gained as the dollar retreated, amid speculation the lower currency will help the profitability of their businesses overseas. Hormel Foods Corp. added 2.3 percent, while Tyson Foods Inc. and Campbell Soup Co. increased more than 1.5 percent.

     Merck & Co. was one of the biggest boosters to the benchmark index and the best in the Dow, rising 2.5 percent. The shares had their strongest day in two months after positive trial results for its Keytruda lung cancer treatment.

     Pioneer Natural Resources Co. sank 6.1 percent, the worst in the S&P 500 and its biggest loss since January. Investors panned its $435 million deal to buy drilling rights from Devon Energy Corp., as Pioneer is financing the purchase with new stock that will dilute the value of their holdings.

 

Have a wonderful evening everyone.

 

Be magnificent!

The supreme consideration is man.

Mahatma Gandhi

As ever,

 

Carolann

 

People need dreams, there’s as much nourishment in ‘em as food.

                                                     -Dorothy Gilman, 1923-2012

 

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