August 16, 2023 Newsletter

Dear Friends,

Tangents:

August 16, 1988: IBM introduces software for artificial intelligence.
Madonna, b. 1958.
Elvis Presley, d. 1977.
Babe Ruth, d. 1948.

Ancient and iconic: These trees are competing for ‘Tree of the Year’.  Voting is open to the public this month and through Sep-timber. 
PHOTOS OF THE DAY

England’s Lionesses celebrate their semi-final victory over Australia. Photograph: Naomi Baker/The FA/Getty Images

A 12.5 metre-high sculpture of Emperor Wu of Han in Guazhou, Gansu Province, China Photograph: Costfoto/NurPhoto/Shutterstock

Tahiti, French Polynesia
The US surfer Kelly Slater jumps into the water at Teahupo’o during the World Surf League Shiseido Tahiti pro-surfing event.  Photograph: AFP/Getty.
Market Closes for August 16^th, 2023

International Markets

Bonds

Currencies

Commodities

Market Commentary:
📈 On this day in 1922: The nation’s first commercial broadcaster launched. AT&T kicked off the New York City radio station WEAF, which charged $50 for a 10-minute block of air.
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite declined slightly to 19,899.07 in Toronto.
Royal Bank of Canada contributed the most to the index decline, decreasing 0.5%.
Wesdome Gold Mines Ltd. had the largest drop, falling 5.5%.
Today, 124 of 227 shares fell, while 102 rose; 4 of 11 sectors were lower, led by materials stocks.
Insights
* The index declined 1.8% in the past 52 weeks. The MSCI AC Americas Index gained 1.6% in the same period
* The S&P/TSX Composite is 4.5% below its 52-week high on Feb. 2, 2023 and 11.3% above its low on Oct. 13, 2022
* The S&P/TSX Composite is down 1.9% in the past 5 days and fell 1.8% in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 13 on a trailing basis and 14.1 times estimated earnings of its members for the coming year
* The index’s dividend yield is 3.4% 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 fell to 11.63% compared with 11.71% in the previous session and the average of 10.53% over the past month
================================================================
| Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
Materials | -15.1424| -0.7| 14/36
Financials | -13.6707| -0.2| 12/17
Communication Services | -1.7841| -0.2| 0/5
Real Estate | -0.9864| -0.2| 11/10
Health Care | 1.0891| 1.8| 4/0
Consumer Discretionary | 1.3666| 0.2| 6/8
Consumer Staples | 3.0418| 0.4| 9/2
Utilities | 3.8639| 0.5| 10/5
Industrials | 4.3259| 0.2| 11/15
Information Technology | 5.8519| 0.4| 6/5
Energy | 11.3321| 0.3| 19/21
================================================================
| | |Volume VS | YTD
| Index | | 20D AVG | Change
Top Contributors |Points Move| % Change | (%) | (%)
================================================================
RBC | -6.0350| -0.5| -36.4| -3.0
Agnico Eagle Mines | -3.8730| -1.8| 1.8| -11.6
Wheaton Precious Metals | -3.5460| -2.0| -9.3| 6.2
CAE | 3.1380| 4.5| 123.6| 24.9
Constellation Software | 4.6700| 1.3| 77.1| 30.6
Suncor Energy | 10.9100| 2.8| 0.1| 0.3
US
By Isabelle Lee and Cristin Flanagan
(Bloomberg) — Pressure on US equities and Treasuries ramped up in the final minutes of Wednesday’s session as traders digested hawkish comments from Federal Reserve officials at their last meeting.
The S&P 500 dropped 0.8%, slumping for the second day in a row, amid concerns the central bank would continue to raise interest rates.
The Nasdaq 100 slid 2.2% over a two-day losing streak as tech behemoths including Meta Platforms Inc. and Amazon.com Inc. along with Tesla Inc. dragged on the equities benchmarks.
“The Fed has no choice but to keep it up until they are convinced that inflationary expectations are quashed,” Steve Sosnick, chief strategist at Interactive Brokers, said after the minutes from the central bank’s July meeting were released.  “Doing otherwise risks some of the embers reigniting. Even though two governors favored keeping rates steady in July, it is important to keep in mind that a pause is not a pivot.”
Technical factors are also behind the stock market’s recent dips.
The S&P 500 closed below its average price over the last 50 days for a second day after a wave of trading in zero-day options helped push the index below the trendline for the first time since March at the tail-end of the prior session.
US Treasury yields turned higher in the afternoon session with the 10-year approaching 4.3%.
Earlier this week, yields on the benchmark bond approached levels last reached in October.
Yield on the policy sensitive two-year closed in on 5%.
“The FOMC minutes reiterated many of the core themes that Powell delivered at the July press conference,” Ben Jeffery, a strategist at BMO Capital Markets wrote. “There was nothing here to derail our assumption that September will be another ‘skip,’ although another hike in November or December is firmly on the table if the data warrants.”
Among currencies, the pound led Group-of-10 peers after UK inflation topped expectations.
Meanwhile, China’s economic woes remain in the spotlight, despite a slew of stimulus steps by authorities.
The onshore yuan sank against the dollar while the yen fell to a level that triggered Japan’s intervention in September.
China’s central bank moved to boost fragile sentiment with a stronger-than-expected reference rate for the yuan and the largest injection of short term cash to the financial system since February.
So far the steps have failed to restore optimism.
Still, markets are not yet fully reflecting the risks from China’s deteriorating fundamentals, according to Tiffany Wilding, an economist and managing director at Pacific Investment Management Co.
“Given the usual lags, deflationary spillovers have likely only just begun to impact global consumer markets,” Wilding wrote in a note to clients. “Discounting likely to accelerate over the coming quarters.”
Hot wage figures and US retail statistics had rattled markets on Tuesday, spurring bets tight central bank policy will be in place for longer.
Minneapolis Fed President Neel Kashkari warned that inflation was “still too high.”
Corporate Highlights:
* London-listed BAE Systems Plc is in talks on a possible acquisition of Ball Corp.’s aerospace division, people with knowledge of the matter said.
* Intel Corp.’s $5.4 billion deal with Israel’s Tower Semiconductor Ltd. collapses after failing to win Chinese regulatory approval in time.
* Energy Transfer LP will buy Crestwood Equity Partners LP in a $7.1 billion all-equity deal allowing Energy Transfer to expand its US pipeline network.
* Target Corp. climbs after a surprising profit surge in the second quarter overshadows the company’s increasingly cautious outlook on the rest of the year.

Key events this week
* US initial jobless claims, US Conf. Board leading index, Thursday
* Eurozone CPI, Friday

Some of the main moves in markets:
Stocks
* The S&P 500 fell 0.8% as of 4:01 p.m. New York time
* The Nasdaq 100 fell 1.1%
* The Dow Jones Industrial Average fell 0.5%
* The MSCI World index fell 0.9%
Currencies
* The Bloomberg Dollar Spot Index rose 0.2%
* The euro fell 0.3% to $1.0875
* The British pound rose 0.1% to $1.2720
* The Japanese yen fell 0.5% to 146.36 per dollar
Cryptocurrencies
* Bitcoin fell 0.3% to $29,073.57
* Ether fell 0.5% to $1,819.2
Bonds
* The yield on 10-year Treasuries advanced six basis points to 4.27%
* Germany’s 10-year yield declined two basis points to 2.65%
* Britain’s 10-year yield advanced six basis points to 4.65%
Commodities
* West Texas Intermediate crude fell 2.2% to $79.17 a barrel
* Gold futures fell 0.7% to $1,922.40 an ounce
This story was produced with the assistance of Bloomberg Automation.
–With assistance from Lu Wang and Alex Nicholson.

Have a lovely evening.

Be magnificent!
As ever,

Carolann

If you put the federal government in charge of the Sahara Desert, in five years there’d be a shortage of sand. -Milton Friedman, 1912-2006.

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