May 13, 2022 Newsletter

Dear Friends,

Tangents:
Carolann is away from the office today, I will be writing the newsletter on her behalf.  

PHOTOS OF THE DAY – The week in wildlife

A mother and calf one-horned rhinoceros at the Pobitora Wildlife Sanctuary on the outskirts of Gauhati, India. The sanctuary is known for its Indian one-horned rhino population
CREDIT: Anupam Nath/AP

A bee-eater bird catches a bee in the village of Buszkowice in Podkarpacie, Poland. The protected bird is listed in the Polish Red Book of Animals as a species close to extinction.
CREDIT: Darek Delmanowicz/EPA

One of the brown bears recently moved from Kyiv wanders around the woodland area of its new home at the Bear Sanctuary Domazhyr in Lviv, Ukraine.
CREDIT:  Leon Neal/Getty Images

Market Closes for May 13^th, 2022

International Markets

Bonds

Currencies

Commodities

Canada
By Stefanie Marotta
(Bloomberg) — Canadian equities squashed a six-day losing streak that pummeled the index into a correction market.
The market made its biggest jump since 2020, led by technology and energy stocks as investors bet that central banks will take bigger rate hikes off the table.
The S&P/TSX Composite rose 2% at 20,099.81 in Toronto.
The move was the biggest since rising 2.1% on Feb. 1, 2021 and follows the previous session’s decrease of 0.7%.
Today, energy stocks led the market higher, as all sectors gained; 222 of 239 shares rose, while 17 fell.
Shopify Inc. contributed the most to the index gain, increasing 12.4%. Lightspeed Commerce Inc. had the largest increase, rising 31.3%.
Insights
* So far this week, the index fell 2.6%
* The index advanced 5% in the past 52 weeks. The MSCI AC Americas Index lost 3.6% in the same period
* The S&P/TSX Composite is 9.5% below its 52-week high on April 5, 2022 and 5.4% above its low on May 13, 2021
* S&P/TSX Composite is trading at a price-to-earnings ratio of 15.6 on a trailing basis and 12.5 times estimated earnings of its members for the coming year
* The index’s dividend yield is 2.9% on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$3.15t
* 30-day price volatility rose to 19.12% compared with 17.83% in the previous session and the average of 13.86% over the past month
================================================================
| Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
* Energy | 106.2527| 3.0| 34/0
* Financials | 90.3931| 1.5| 27/1
* Information Technology | 74.3394| 7.1| 16/0
* Materials | 35.7034| 1.4| 43/9
* Industrials | 23.5326| 1.0| 27/3
* Consumer Discretionary | 20.9720| 3.3| 14/0
* Real Estate | 15.0237| 2.8| 23/0
* Communication Services | 12.0310| 1.2| 7/0
* Consumer Staples | 9.5895| 1.2| 10/1
* Utilities | 9.0300| 0.9| 13/3
* Health Care | 3.9005| 4.1| 8/0
================================================================
| | |Volume VS |
| Index | | 20D AVG |YTD Change
Top Contributors |Points Move| % Change | (%) | (%)
================================================================
Shopify | 45.0300| 12.4| 12.9| -70.2
Canadian Natural | | | |
Resources | 28.5700| 4.7| -47.6| 47.1
Brookfield Asset | | | |
Management | 25.0900| 4.2| 19.9| -19.3
Barrick Gold | -1.5900| -0.5| 12.2| 9.7
Agnico Eagle Mines | -1.6880| -0.8| 9.4| -2.6
Canadian National | -8.9170| -1.5| 143.8| -8.0
US
By Rita Nazareth
(Bloomberg) — Stocks rallied at the end of a chaotic week in financial markets, with a little help from Federal Reserve Chair Jerome Powell’s reassurance that bigger rate hikes would be off the table for now even after the hot inflation readings of the past few days.
For a market plagued by fears that more aggressive monetary tightening could tip the economy into a recession, Powell’s remarks ended up soothing frayed nerves and sparking a rebound in beaten-down risk assets.
Despite the strong gains on Friday, many traders aren’t yet convinced that equities have reached a bottom after a selloff that shaved $10 trillion from US stock values in 18 weeks. Instead, they say investors should still brace for volatility as the Fed’s ability to fight price pressures without causing a hard landing may depend on factors outside the central bank’s control.
After sinking almost 20% from a record and flirting with a bear market, the S&P 500 saw a broad-based rally Friday. It still posted a sixth straight week of declines — the longest losing streak since June 2011. The Nasdaq 100 outperformed amid a rally in giants like Apple Inc., Microsoft Corp. and Amazon.com Inc. Meanwhile, Elon Musk caused chaos over his takeover offer for Twitter Inc., first claiming his bid was “temporarily on hold” and then maintaining he’s “still committed” to the deal — sending the social-media giant into a tailspin. Tesla Inc. jumped. Treasuries fell with the dollar.
Over the course of another tumultuous week for financial markets, some prominent voices on Wall Street pondered on the outlook for stocks after a powerful selloff. Peter Oppenheimer at Goldman Sachs Group Inc. said on Tuesday that the rout had created buying opportunities, with headwinds such as inflation and hawkish central banks already priced in.
Meantime, Morgan Stanley strategist Michael Wilson noted that equities were still “not priced for this slowdown in growth from current levels.”
There are five telltale indicators that are used to call a bottom in stocks, including spikes in the Cboe Volatility Index, puts substantially outnumbering calls and a dismal market sentiment, according to Lindsey Bell, chief markets and money strategist at Ally.
While the VIX has stayed near 30, past bear markets featured moves above 45. “A volatility climax is a signature of market bottoms,” she said.

Comments:
* “Much speculative froth has already been removed from the market,” wrote Mark Haefele, chief investment officer at UBS Global Wealth Management. “So, we advise against a hasty exit. Our central scenario is also that a recession will be avoided over the next 12 months. However, investors should continue to brace for high levels of volatility.”
* “We’ve certainly revalued the stock market in a big way,” Jim Paulsen, chief investment strategist at Leuthold Group, told Bloomberg Television and Radio. “Really great fear on Main Street, on Wall Street, combined with, I think, ongoing good fundamentals — including strong balance-sheets in the household sector, the corporate sector and the banking industry — I think that’s a ‘dynamite’ combination you have to buy on.”
* “Investor sentiment is at extreme levels and technical indicators are universally negative,” said Mark Hackett, chief of investment research at Nationwide. “This reflects the degree of pessimism embedded in the market, setting the stage for a bounce from oversold levels, which could be expected in the coming weeks.”
* “There was a sense of calm in the markets, but again without any fundamental news to suggest this is perhaps the bottom,” wrote Fawad Razaqzada, an analyst at City Index and FOREX.com. “Stocks have struggled to sustain any recovery attempts as traders have been quick to take profit on rebounds amid a bearish macro backdrop.” Expectations of a technical bounce in the S&P 500 are building after the gauge’s relentless slide of the past several weeks. One possible zone of support comes from a cluster of Fibonacci levels — which captures retracements of rallies in the American equity benchmark from 2020 Covid crash lows. Equities, bonds, cash and gold all saw outflows in the week ended May 11, Bank of America Corp. strategists led by Michael Hartnett wrote in a note, citing EPFR Global data. At $1.1 billion, technology stocks suffered their biggest withdrawals so far this year, second only to financials, which lost $2.6 billion. “The definition of true capitulation is investors selling what they love,” Hartnett said, citing assets like big tech, for example. “Fear and loathing suggest stocks are prone to an imminent bear-market rally, but we do not think ultimate lows have been reached.”
Stocks
* The S&P 500 rose 2.4% as of 4 p.m. New York time
* The Nasdaq 100 rose 3.7%
* The Dow Jones Industrial Average rose 1.5%
* The MSCI World index rose 2.3%
Currencies
* The Bloomberg Dollar Spot Index fell 0.3%
* The euro rose 0.2% to $1.0401
* The British pound rose 0.3% to $1.2241
* The Japanese yen fell 0.8% to 129.32 per dollar
Bonds
* The yield on 10-year Treasuries advanced nine basis points to 2.93%
* Germany’s 10-year yield advanced 11 basis points to 0.95%
* Britain’s 10-year yield advanced eight basis points to 1.74%
Commodities
* West Texas Intermediate crude rose 4% to $110.36 a barrel
* Gold futures fell 0.9% to $1,808.40 an ounce

–With assistance from Sunil Jagtiani, John Viljoen, Srinivasan Sivabalan, Vildana Hajric, Isabelle Lee and Akshay Chinchalkar.
Have a lovely evening everyone.

Jordan

Nothing is so firmly believed as that which we least know -Michel De Montaigne

Assistant to Carolann Steinhoff

Queensbury Securities Inc.,
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