May 1, 2023 Newsletter

Dear Friends,

Tangents: Happy Monday.

The Met Gala takes place in New York today.  Celebrities are getting ready to debut their eye-catching outfits at “fashion’s biggest night.” This year, the theme is “In honor of Karl,” a tribute to the late designer Karl Lagerfeld.

May 1, 1961: Fidel Castro declares Cuba a socialist nation and bans elections.  A month after Cuban troops had fought off a US backed military invasion at the Bay of Pigs, Castro announces that “The revolution has no time for elections.”

2003: President George W. Bush landed in a jet on the aircraft carrier USS Abraham Lincoln off the California coast and, in a speech to the nation, declared major combat in Iraq over. Go to article >

Judy Collins, singer, b. 1934.

Uber released its 2023 lost and found report.  Uber’s annual list of items forgotten by passengers includes some truly bizarre objects — including an ankle monitor, a lightsaber and a slushy machine.

AI drones are the future of farming. — Amanda Little
Social science can explain why King Charles III is key to Britain. — Adrian Wooldridge

Everything you need to know about the Met Gala.

There’s another mystery balloon.

1st mega-tsunami on record since antiquity was triggered by Tonga volcanic eruption
The Tonga underwater volcanic eruption rivaled the strength of the largest U.S. nuclear bomb and produced a “mega-tsunami” nearly the height of a 30-story skyscraper,
a recent study finds. Read More

Ancient ‘urine flasks’ for smelling (and tasting) pee uncovered in trash dump at Caesar’s forum in Rome
A Renaissance-era trash dump discovered inside the Forum of Caesar in Rome is brimming with old medical supplies, including 500-year-old medicine bottles and urine flasks — containers used to collect patients’ pee for medical analysis, a new study finds. Read More

14 million:
That’s how many jobs worldwide will vanish in the next five years, according to a report published Sunday by the World Economic Forum. The forecasted decline, equivalent to about 2% of current employment, will be driven by churns in the economy and the adoption of technologies such as artificial intelligence.

PHOTOS OF THE DAY

Hook, UK
Members of the Hook Eagle Morris Men perform outside the Shack Cafe in Hampshire as they see in the May Day dawn
Photograph: Andrew Matthews/PA

London, UK
The speaker of the House of Commons, Sir Lindsay Hoyle, with the speaker’s state coach, which has returned to Westminster for the first time time since 2005. The coach, believed to have been built in the 1690s for King William III and Queen Mary II, was last used by the Commons speaker George Thomas in 1981 to attend the marriage of the Prince of Wales to Lady Diana Spencer at St Paul’s Cathedral
Photograph: Stefan Rousseau/PA

Glastonbury, UK
A Green Man at the Beltane ceremony at Chalice Well in Somerset, where Beltane is celebrated at sunrise and throughout the day
Photograph: Ben Birchall/PA
Market Closes for May 1, 2023

International Markets

Bonds

Currencies

Commodities

Market Commentary:
📈 On this day in 1956, Warren Buffett received $105,000 from seven local investors to help him launch an investment partnership from his bedroom in a rented house in Omaha. Mr. Buffett went on to become one of the most well-known investors of all time, and his conglomerate Berkshire Hathaway is now one of the biggest stocks in the S&P 500.
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite fell 0.1% at 20,615.10 in Toronto.
The move follows the previous session’s increase of 0.6%.
Shopify Inc. contributed the most to the index decline, decreasing 2.4%.
Denison Mines Corp. had the largest drop, falling 5.4%.
Today, 119 of 232 shares fell, while 106 rose; 5 of 11 sectors were lower, led by energy stocks.
Insights
* The index declined 0.7% in the past 52 weeks. The MSCI AC Americas Index was little changed in the same period
* The S&P/TSX Composite is 2.8% below its 52-week high on May 4, 2022 and 15.3% above its low on Oct. 13, 2022
* The S&P/TSX Composite is down 0.3% in the past 5 days and rose 2.6% in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 13.4 on a trailing basis and 13.8 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$3.29t
* 30-day price volatility fell to 8.04% compared with 8.11% in the previous session and the average of 11.19% over the past month
================================================================
| Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
Energy | -29.1181| -0.8| 6/31
Financials | -9.7243| -0.2| 12/15
Information Technology | -6.1629| -0.4| 5/7
Real Estate | -2.1994| -0.4| 4/17
Health Care | -0.0096| 0.0| 3/3
Consumer Staples | 0.4342| 0.0| 5/6
Utilities | 0.9602| 0.1| 10/6
Communication Services | 1.7336| 0.2| 4/1
Materials | 3.2751| 0.1| 25/23
Consumer Discretionary | 5.0320| 0.7| 10/5
Industrials | 14.3396| 0.5| 22/5
================================================================
| | |Volume VS| YTD
|Index Points| | 20D AVG | Change
Top Contributors | Move |% Change | (%) | (%)
================================================================
Shopify | -13.2900| -2.4| -20.8| 36.2
Canadian Natural Resources | -7.3860| -1.2| -66.4| 8.5
Suncor Energy | -6.0950| -1.5| 3.3| -2.7
First Quantum Minerals | 4.1700| 3.3| -38.0| 20.1
Franco-Nevada | 4.3680| 1.6| 9.0| 13.2
Constellation Software | 5.9130| 1.6| -29.3| 30.1
US
By Rita Nazareth
(Bloomberg) — A renewed bout of selling hit the Treasury market, with factory data bringing little comfort on the inflation front and a handful of companies offering bonds ahead of the Federal Reserve decision.
As Wall Street gears up for the Fed’s 10th consecutive rate hike since March of last year, several borrowers are piling in after exiting their earnings blackouts, with US investment-grade issuance hitting over $22 billion in one of the busiest sessions of 2023.
Among notable firms tapping the market: Meta Platforms Inc. raised $8.5 billion, Comcast Corp. priced a $5 billion deal and Hershey Co. sold $750 million in bonds.
These big offerings usually represent a double-whammy for Treasuries, which tend to cheapen amid competition from new debt and as underwriters sell government notes to rate-lock the issue for corporate buyers.
Another factor weighing on bond prices Monday was the stabilization in sentiment after JPMorgan Chase & Co. decided to acquire failed lender First Republic Bank.
To Krishna Guha at Evercore, trading suggests little or no spillover from that situation, which is consistent with the notion that there’s roughly no surprise here and the market would be willing to distinguish between First Republic and other financial firms.
“The decisive action by regulators clears the decks for the Fed to press ahead and raise rates at its May meeting,” Guha noted. “Our base case is that the economy cools from here, the Fed will not hike further after May and the next move will be a cut in December.”
Swap traders slightly upgraded the odds that the Fed will increase its policy rate by a quarter-point Wednesday.
Treasuries sold off across the curve, with yields on 30-year bonds climbing the most in 2023 and those on 10-year notes approaching 3.6%.
Equities were little changed after notching two straight months of gains as traders waded through a batch of corporate results.
Stock investors holding on to hopes the Fed will cut rates in the second half could be disappointed this week, according to Morgan Stanley’s Michael Wilson.
“If the message delivered at this meeting is more hawkish, it could provide a near-term negative surprise for equities,” Wilson wrote in a note.
Andrew Brenner at NatAlliance Securities says the question investors will need to ask themselves after Powell’s conference is whether there’s a pause coming after Wednesday — and whether that would be a “hawkish pause or a real pause.”
“The Fed will tell the markets that there is no expected lower rates coming at the end of the year, but markets will not believe them, as the Fed longer-term outlook and predictions have been awful,” Brenner noted. “We still see two rate cuts by January.”
Key events this week:
* US JOLTS job openings, factory and durable goods orders, Tuesday
* ADP employment, S&P global US services PMI, ISM services, Wednesday
* Federal Reserve Chair Jerome Powell holds news conference following rate decision, Wednesday
* US initial jobless claims, trade balance, Thursday
* European Central Bank rate decision, followed by ECB President Christine Lagarde’s news conference, Thursday
* US unemployment, nonfarm payrolls, Friday

Some of the main moves in markets:
Stocks
* The S&P 500 was little changed as of 4 p.m. New York time
* The Nasdaq 100 fell 0.1%
* The Dow Jones Industrial Average fell 0.1%
* The MSCI World index fell 0.1%
Currencies
* The Bloomberg Dollar Spot Index rose 0.3%
* The euro fell 0.4% to $1.0973
* The British pound fell 0.6% to $1.2492
* The Japanese yen fell 0.9% to 137.50 per dollar
Cryptocurrencies
* Bitcoin fell 5.1% to $27,840
* Ether fell 4.3% to $1,812
Bonds
* The yield on 10-year Treasuries advanced 17 basis points to 3.59%
* Germany’s 10-year yield was little changed at 2.31%
* Britain’s 10-year yield was little changed at 3.72%
Commodities
* West Texas Intermediate crude fell 1.4% to $75.70 a barrel
* Gold futures fell 0.5% to $1,988.70 an ounce
This story was produced with the assistance of Bloomberg Automation.
–With assistance from Christopher DeReza, Michael Mackenzie, Vildana Hajric, Carly Wanna and Isabelle Lee.
Have a lovely evening.

Be magnificent!
As ever,

Carolann

You can’t connect the dots looking forward; you can only connect them looking backwards…You have to trust
in something – your gut, destiny, life, karma, whatever.  Because believing that the dots will connect down
the road will give you the confidence to follow your heart even when it
leads you off the well-worn path. –Steve Jobs, 1955-2011.

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