July 22, 2022 Newsletter

Dear Friends,

Tangents: Happy Friday.
On July 22, 1934, a man identified as bank robber John Dillinger was shot to death by federal agents in Chicago.  Go to article »
July 22, 1376: Pied Piper of Hamelin, Germany.

Cats are going wild over this video game.  People are posting their cats’ reactions to a new feline-friendly video game. Watch the funny moments here.

Prince George is 9! The Duke and Duchess of Cambridge share a photo of him on the eve of his birthday.  So adorable. The little prince is really growing up right before our eyes. 

Australia’s largest music festival sinks into the mud, forcing first day cancellation.  Festivalgoers at Splendour in the Grass 2022 were excited for a lineup of performers like Gorillaz and The Strokes. They got a mud pit instead.

The Volkswagen camper van that took the Sixties on the road is getting a 21st Century makeover.

Archaeologists may have discovered the palace of Genghis Khan’s grandson: The remains of a once resplendent palace built for Hulagu Khan, a grandson of Genghis Khan, may have been discovered in Van Province in eastern Turkey, a team of archaeologists suggests.  However, researchers not associated with the research urged caution, saying that more information is needed before the structure can be tied to the Khan family.
Full Story: Live Science (7/22) 

How do oysters make pearls?  While nearly all of the world’s most treasured gemstones can be found buried underground, pearls hide in a far more unexpected setting: inside a shell.  So how exactly did these iridescent jewels wind up in such an unlikely place?  Full Story: Live Science (7/22) 

Lives Lived: Werner Reich was a frightened 16-year-old prisoner at Auschwitz when a fellow inmate, a magician, taught him a card trick. It changed his life. He died at 94.

“He chose not to act. Same review he got for ‘Home Alone 2,’” Stephen Colbert said on Thursday’s live edition of “Late Night.”:
“He did not call them from a box. He did not call while watching Fox. He did not help out Uncle Sam. His brain is made of eggs and ham. But, in his defense, it is possible he forgot the number for 9-1-1.” — STEPHEN COLBERT, on news that Trump didn’t reach out to any security officials on Jan. 6.
“Yes, he is a stain on our history — and thanks to these hearings, we know that stain is ketchup.” — STEPHEN COLBERT, referring to Representative Adam Kinzinger’s referring to Trump’s inaction as “a stain” on our history.

PHOTOS OF THE DAY

Protesters from the action group Ultima Generazione are pulled away after attempting to glue their hands to the glass covering Botticelli’s Primavera at the Uffizi Gallery. Ultima Generazione is so named as its activists believe they are the ‘last generation’ able to reverse the effects of climate change
CREDIT: Laura Lezza/Getty

Sheep and goats graze in the outskirts of Mount Nemrut in Tatvan. Shepherds living in Kiyiduzu village feed their animals on the rich grass of the plateaus as the weather warms up
CREDIT: Anadolu Agency/Getty

Children apply the first stickers to Yayoi Kusama’s interactive work Obliteration Room at Tate Modern. The installation begins as a blank apartment filled with all-white furniture and visitors are given a sticker sheet of colourful dots to turn the work into a sea of colour
CREDIT: Aaron Chown/PA

Market Closes for July 22^nd, 2022

International Markets

Bonds

Currencies

Commodities

Market Commentary:
On this day in 1999, the U.S. Securities & Exchange Commission cracked down on the offering of so-called “free stock” over the Internet. The SEC found that Internet users that were willing to provide their e-mail addresses received “free” shares in companies that planned to go public—but that the companies were not disclosing their risks. One of them planned to revive lunar exploration; another promised its new shareholders that their stock would be worth at least $200 a share, although the company had so far generated less than $30 in total gross revenues.
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite fell 0.4% at 18,982.92 in Toronto.
The move was the biggest since falling 1.5% on July 14 and follows the previous session’s increase of 0.2%.
Shopify Inc. contributed the most to the index decline, decreasing 7.3%.
Aurora Cannabis Inc. had the largest drop, falling 8.1%.
Today, 148 of 238 shares fell, while 83 rose; 7 of 11 sectors were lower, led by information technology stocks.
Insights
* This month, the index rose 0.6%
* So far this week, the index rose 3.2%, heading for the biggest advance since the week ended Feb. 5
* The index declined 5.5% in the past 52 weeks. The MSCI AC  Americas Index lost 11% in the same period
* The S&P/TSX Composite is 14.5% below its 52-week high on April 5, 2022 and 4.5% above its low on July 14, 2022
* S&P/TSX Composite is trading at a price-to-earnings ratio of 14.8 on a trailing basis and 11.6 times estimated earnings of its members for the coming year
* The index’s dividend yield is 3.1% on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$3.06t
* 30-day price volatility fell to 20.12% compared with 20.43% in the previous session and the average of 19.80% over the past month
================================================================
| Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
* Information Technology | -35.3213| -3.1| 1/13
* Energy | -24.7383| -0.7| 9/27
* Materials | -19.7408| -1.0| 9/39
* Financials | -13.4774| -0.2| 9/20
* Consumer Discretionary | -4.1396| -0.6| 3/10
* Health Care | -2.8334| -3.5| 1/5
* Industrials | -2.5852| -0.1| 11/18
* Communication Services | 4.4062| 0.5| 4/2
* Real Estate | 4.7709| 0.9| 18/5
* Consumer Staples | 6.4018| 0.8| 5/6
* Utilities | 7.3329| 0.7| 13/3
================================================================
| | |Volume VS| YTD
|Index Points | | 20D AVG | Change
Top Contributors | Move | % Change | (%) | (%)
================================================================
* Shopify | -29.8300| -7.3| 32.2| -72.3
* Suncor Energy | -5.7470| -1.5| -44.1| 25.7
* Canadian Natural Resources | -5.0120| -1.0| -58.9| 20.4
* Fortis | 3.7790| 2.0| -43.5| -1.5
* TC Energy | 4.4610| 1.0| -78.3| 16.7
* Couche-Tard | 5.9570| 2.0| -38.0| 1.3
US
By Stephen Kirkland
(Bloomberg) — US stocks fell as disappointing results from social-media firms and weak economic data added to recession fears.
Treasuries rallied as traders dialed back bets on Federal Reserve hikes, while the dollar retreated.
The S&P 500 dropped for the first time in four days, while the tech-heavy Nasdaq 100 underperformed major benchmarks, closing down 1.8%.
Snap Inc.’s poor results and Twitter Inc.’s sales miss raised concern about online ad spending and weighed on shares of Facebook parent Meta Platforms Inc. and Google owner Alphabet Inc.
Hardware and storage companies including Micron Technology Inc. and Western Digital Corp. fell after Seagate Technology Plc’s earnings miss and weak outlook.
Despite Friday’s churn, the equity market posted its best week in a month, paring this year’s market rout to about 17%.
Speculation that the worst of the selloff has passed is partly behind the move.
But angst about the damage from inflation, rapidly rising interest rates and recession fears is proving hard to shake despite a tempering in expectations for Fed aggressiveness next week.
“The Fed meeting is crucial,” Quincy Krosby, chief global strategist at LPL Financial, said by phone. “Does the Fed rhetoric become less hawkish? Because what the market may be expecting that the Fed goes into the summer months and comes out perhaps a little bit less hawkish. But it’s a question mark because it depends on the trajectory of inflation.” 
In other earnings news:
* American Express Co. rallied after reporting record revenue and raising full-year forecasts.
* Verizon Communications Inc. slumped after it missed profit  estimates and cut guidance.
* HCA Healthcare Inc. soared after an earnings beat.

Snap’s results have become a barometer for ad spending amid mounting economic concerns.
There are growing signs that tech companies are preparing for a recession with some pulling back on hiring, while Meta has lost about half of its value this year after disappointing revenue forecasts.
Meta and Alphabet are scheduled to report earnings next week.
Underscoring recession fears, Treasuries extended an advance, pushing the 10-year yield to around 2.7%.
US business activity contracted in July for the first time in more than two years, according to the S&P Global flash composite purchasing managers output index.
That prompted swaps traders to pare bets on Fed hikes, shifting toward pricing a 50-basis-point hike in September as more likely than a three-quarter-point move.
Swaps targeting next week’s meeting briefly indicated a 75 basis-point increase was slightly less than certain.
Meanwhile, German short-term bonds soared as investors trimmed bets on European Central Bank rate hikes after weaker-than-expected PMI data in the region fanned fears of a recession.

Oil posted a weekly loss with softer European economic data and signals of US fuel demand stalling souring the market’s outlook.
West Texas Intermediate slipped below $95 a barrel. 
More market commentary
* “The market has experienced a selloff due to multiple compressions, not due to lower earnings,” Alicia Levine, head of equities, BNY Mellon Wealth Management, said in an email. “The recent earnings in social media are a reminder that there is earnings risk in these pummeled sectors … which still may not  be priced into the market. Further, there is macro risk to earnings in general after weak US and European PMI’s this morning.”
* “Expectations heading into the reporting cycle are ultra-low and well-priced in most sectors,” Art Hogan, chief market strategist at B. Riley Wealth, wrote. “Another potential positive is that market participants may have reached a peak in pessimism at the same time that inflation has likely peaked.  With pessimism at a peak, and inflation receding, the market may be at the ever elusive capitulation point and see more constructive action in the second half.”
* “The message of the week is clear: bulls clearly took control of markets,” said Florian Ielpo, head of macro research at Lombard Odier Asset Management. “For now, sentiment is in the driver seat and the previously excess pessimism is now resulting in a relief rally: investors cannot complain about that.”
* “It’s still very early days but we’ve seen numerous cases now of earnings surprises driven by the ‘it’s not as bad as we feared’ argument,” said Craig Erlam, a senior market analyst at Oanda. “That’s a relief of course, but surely not a case for a sustainable rebound.”

Some of the main moves in markets:
Stocks
* The S&P 500 fell 0.9% as of 4 p.m. New York time
* The Nasdaq 100 fell 1.8%
* The Dow Jones Industrial Average fell 0.4%
* The MSCI World index fell 0.5%
Currencies
* The Bloomberg Dollar Spot Index fell 0.2%
* The euro fell 0.2% to $1.0208
* The British pound was unchanged at $1.1995
* The Japanese yen rose 1% to 136.02 per dollar
Bonds
* The yield on 10-year Treasuries declined 12 basis points to 2.76%
* Germany’s 10-year yield declined 19 basis points to 1.03%
* Britain’s 10-year yield declined 11 basis points to 1.94%
Commodities
* West Texas Intermediate crude fell 1.8% to $94.58 a barrel
* Gold futures rose 0.5% to $1,739.30 an ounce
–With assistance from Tassia Sipahutar, Sagarika Jaisinghani, Robert Brand, Vildana Hajric, Isabelle Lee and Natalia Kniazhevich.
Have a wonderful weekend everyone.

Be magnificent!
As ever,

Carolann

The only way to keep your health is to eat what you don’t want, drink what you don’t like, and do what you’d rather not. –Mark Twain, 1835-1910.

Carolann Steinhoff, B.Sc., CFP®, CIM, CIWM
Senior Investment Advisor

Queensbury Securities Inc.,
St. Andrew’s Square,
Suite 340A, 730 View St.,
Victoria, B.C. V8W 3Y7

Tel: 778.430.5808
(C): 250.881.0801
Toll Free: 1.877.430.5895
Fax: 778.430.5828
www.carolannsteinhoff.com