November 10,2022 Newsletter

Dear Friends,

Tangents: Happy Friday Eve.

November 10, 1801: US State Kentucky Outlaws dueling.  The last recorded duel took place in France in 1967.
1871: Stanley finds Livingstone.
November 10, 1951: Direct-dial, coast-to-coast telephone service began with a call between the mayors of Englewood, N.J., and Alameda, Calif. Go to article »
Also on this day in 1951: Area codes introduced.
1983: Microsoft releases Windows.

Heat shield that could land humans on Mars is heading to space today.  NASA said this inflatable heat shield will hitch a ride to space today in the hope that it could eventually assist with human travel to other planets.

PHOTOS OF THE DAY

Draw-dropping
Art imitating life in Richmond Park, London.
Photograph: Martin Long

Fantastic foliage
‘These leaves came from a smoke bush in my garden – all 100% natural colours. This year’s display is especially eye popping.’
Photograph: Giselle Dye

London, UK
Shoppers traverse Regent Street as the Spirit of Christmas festive lights are switched on
Photograph: Anadolu Agency/Getty Images
Market Closes for November 10^th, 2022

International Markets

Bonds

Currencies

Commodities

Market Commentary:
On this day in 1494, the first edition of Luca Pacioli’s Summa de Arithmetica, Geometria, Proportioni et Proportionalita was printed in Venice. Corporate balance sheets and income statements can trace their heritage to this day, as the book contained 36 brief chapters on accounting and, for the first time, popularized the concept of double-entry bookkeeping (which offsets assets against liabilities and revenues against expenses).
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite rose 3.3% at 19,990.36 in Toronto.
The move was the biggest since rising 5.1% on April 6, 2020 and follows the previous session’s decrease of 1.6%.
Today, financials stocks led the market higher, as all sectors gained; 217 of 236 shares rose, while 18 fell.
Shopify Inc. contributed the most to the index gain, increasing 16.5%.
CAE Inc. had the largest increase, rising 18.2%.
Insights
* This year, the index fell 5.8%, heading for the worst year since 2018
* So far this week, the index rose 2.8%
* The index declined 6.9% in the past 52 weeks. The MSCI AC Americas Index lost 16% in the same period
* The S&P/TSX Composite is 10% below its 52-week high on April 5, 2022 and 11.8% above its low on Oct. 13, 2022
* The S&P/TSX Composite is up 3.9% in the past 5 days and rose 7.6% in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 13.3 on a trailing basis and 12.5 times estimated earnings of its members for the coming year
* The index’s dividend yield is 3.2% on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$3.08t
* 30-day price volatility rose to 22.32% compared with 20.64% in the previous session and the average of 22.48% over the past month
================================================================
| Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
Financials | 200.4217| 3.4| 27/2
Materials | 115.1169| 5.2| 49/1
Energy | 90.3662| 2.5| 36/2
Information Technology | 90.0558| 9.0| 13/1
Industrials | 57.8609| 2.3| 22/5
Utilities | 24.1812| 2.7| 14/2
Consumer Discretionary | 20.0173| 2.9| 13/1
Real Estate | 18.4951| 3.8| 21/1
Consumer Staples | 12.4454| 1.5| 10/1
Communication Services | 11.4456| 1.2| 6/1
Health Care | 5.6973| 7.2| 6/1
================================================================
| | |Volume VS |
| Index | | 20D AVG |YTD Change
Top Contributors |Points Move| % Change | (%) | (%)
================================================================
Shopify | 56.2000| 16.5| 32.1| -72.1
Brookfield Asset Management | 46.2100| 8.6| 49.4| -22.0
RBC | 29.0000| 2.4| -21.8| -2.5
Loblaw | -1.0280| -0.9| 106.8| 8.0
Canadian Tire | -1.3540| -2.4| 289.2| -19.4
Vermilion Energy | -2.6850| -8.0| 565.7| 71.4
US
By Stephen Kirkland
(Bloomberg) — Stocks surged in a buy-everything relief rally after slower-than-projected price growth spurred bets the Federal Reserve can downshift its aggressive rate-hike path.
The S&P 500 climbed 5.5% for the best first-day reaction to a CPI report since at least 2003 when records began.
About 96% of stocks in the benchmark were in the green, the broadest advance since Oct. 4, according to Bloomberg data.
The rally caught short-sellers wrong-footed, helping spur the outsized gains.
Crypto markets stabilized despite the turmoil surrounding crypto exchange FTX.
Headline inflation came in at 7.7%, the lowest since January, before Russia’s war in Ukraine pushed up commodity prices.
More important for the Fed, the core measure that excludes food and energy slowed more than anticipated.
Thursday’s intense rally only partially clawed back steep losses this year for risk assets hammered by Fed’s tightening.
The S&P 500 is still down 17% in 2022 and the Nasdaq 100 is off nearly 30%, with both headed for their worst years since 2008.
Treasuries soared, sending the rate on two-year notes, more sensitive to monetary policy, down 28 basis points.
Rates traders downgraded the odds of another three-quarter-point rate increase in December almost to nil, while continuing to price in a half-point hike.
The Bloomberg dollar index sank 2%, the biggest drop for records dating back to 2005.
“The first downside surprise in inflation in several months will inevitably be received by an equity market ovation,” Seema Shah, chief global strategist at Principal Asset Management, wrote.
“A 0.5% hike, rather than 0.75%, in December is clearly on the cards but, until we have had a run of these types of CPI reports, a pause is still some way out.”
Fed officials appeared to back a downshift in rate hikes after a stretch of four jumbo-sized increases.
They also stressed the need for policy to remain tight.
Dallas Fed President Lorie Logan said it may soon be appropriate to slow the pace to better assess economic conditions.
San Francisco’s Mary Daly said the moderation was “good news,” but noted “pausing is not the discussion, the discussion is stepping down.”
Swaps markets pulled back bets on a peak rate to slightly less than 4.9% in the first half of next year, from more 5% before the CPI data.
Market reaction to CPI report Rick Rieder, chief investment officer of global fixed income at BlackRock Financial Management Inc.:
“Today’s CPI report showed some moderate improvement as some of the previously elevated excessively high inflation-drivers, such as used cars, started to decline at a faster pace.”
Michael Landsberg, chief investment officer, Landsberg Bennett Private Wealth Management:
“We are preparing for an environment where interest rates remain higher for longer. Investors should be more concerned with the effect that rising rates into a decelerating economy has on their portfolio values rather than the current level of inflation.”
Max Gokhman, chief investment officer for AlphaTrAI:
“We expected that there would be deceleration of core goods prices, but seeing services slump too was a bigger bonus than any banker will get this year. That said, this won’t budge the Fed to rethink a 50bp hike in December, so traders curb their initial enthusiasm.”
Ipek Ozkardeskaya, senior analyst at Swissquote Bank:
“Hallelujah! We finally saw a strong beat in terms of inflation in the US. Both the headline and the core figures came lower than expected. And that helped softening the hawkish Fed expectations, pull the US dollar and the yields lower. The soft inflation has been a puff of fresh air for the entire market.”
Guillermo Hernandez Sampere, head of trading at asset manager MPPM GmbH:
“Pivot Party to start right now, short squeeze will ignite the rally. If the remaining cash comes to work we’ve seen the lows for a while.”
James Athey, investment director at Aberdeen Asset Management:
“Equities will love this and are likely to pick up the baton and keep running. Of course that may make the Fed uncomfortable at this early stage in the disinflation process and so watch out for Fedspeak if equities get too frothy.”
Key events this week:
* US University of Michigan consumer sentiment, Friday

Some of the main moves in markets:
Stocks
* The S&P 500 rose 5.5% as of 4 p.m. New York time
* The Nasdaq 100 rose 7.5%
* The Dow Jones Industrial Average rose 3.7%
* The MSCI World index rose 4.5%
Currencies
* The Bloomberg Dollar Spot Index fell 2%
* The euro rose 1.8% to $1.0196
* The British pound rose 3.1% to $1.1713
* The Japanese yen rose 3.6% to 141.26 per dollar
Cryptocurrencies
* Bitcoin rose 15% to $18,080.76
* Ether rose 21% to $1,336.02
Bonds
* The yield on 10-year Treasuries declined 27 basis points to 3.82%
* Germany’s 10-year yield declined 16 basis points to 2.01%
* Britain’s 10-year yield declined 16 basis points to 3.29%
Commodities
* West Texas Intermediate crude rose 0.5% to $86.27 a barrel
* Gold futures rose 2.5% to $1,756.90 an ounce

–With assistance from Peyton Forte, Sagarika Jaisinghani, Macarena Muñoz, Farah Elbahrawy, Emily Graffeo, Lu Wang, Richard Henderson, Srinivasan Sivabalan, Isabelle Lee, Vildana Hajric and Debarati Roy.

Have a lovely evening.

Be magnificent!
As ever,

Carolann

It is always the secure who are humble. -Gilbert Keith Chesterton, 1874-1936.

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