March 13, 2024, Newsletter

Dear Friends,

Tangents:
March 13, 1781: Planet Uranus discovered by Sir William Herschel.  Go to article >>
March 13, 1877: American Chester Greenwood patents earmuffs after inventing them at age 15.

March 13, 1986: Microsoft offers its first shares to the public with share prices rising from $26 to $29 before closing at $27.25. Microsoft is founded in 1975 by two former classmates at Seattle’s Lakeside School, Bill Gates and Paul Allen. First based in Albuquerque, N.M., they move to the Bellevue area in 1979 and later establish a Redmond campus. Paul Allen, 65, dies in October 2018. (Compiled from Historylink.org)

Every 2.4 million years, Mars tugs on Earth so hard it changes the ocean floor
A new geological study suggests that Mars’ gravitational field pulls the Earth closer to the sun over cycles lasting millions of years, warming our climate. Read More

Dying SpaceX rocket creates glowing, galaxy-like spiral in the middle of the Northern Lights
A large swirl of white light that temporarily outshone vibrant auroras in the Arctic last week was triggered by the death throes of a SpaceX rocket that deployed more than 50 satellites into space. Read More.

35 years after first proposing the World Wide Web, what does its creator Tim Berners-Lee have in mind next?
After seeing the balance of power shift to large corporations and big tech companies, the founder of the World Wide Web is determined to give users control over their data again. Read More.

Technicolor ‘living magic carpet’ deep-sea worm discovered near methane seep off Costa Rica
The rosy-colored, segmented worms are blind and live in complete darkness over 3,000 feet below the surface of the ocean. Read More.

Skier’s unexpected midair collision goes viral
A 17-year-old skier told CNN he feels “beat up” after crashing into the moving seat of a chairlift. Watch the video here.

Can AI really be weaponized?
Rapidly evolving artificial intelligence could pose an “extinction-level” threat to humans and the US must intervene, a report commissioned by the State Department says.

This 70-year-old is calling for sexy, empowered clothes for seniors
In her new memoir, fashion influencer Lyn Slater addresses “how to live boldly at any age,” in appearance, attitude and aesthetic.

PHOTOS OF THE DAY

Valencia, Spain
A worker on a cherry picker helps with a sculpture installation during preparations for the Fallas festival
Photograph: Kai Försterling/EPA

Nottingham, UK
People inspect the interior of Architects of Air’s latest creation, Lumini, during its inaugural test inflation
Photograph: Oli Scarff/AFP/Getty Images

​​​​​​​North Carolina, US
‘A ruby-throated hummingbird in my back garden in Wake Forest.’
Photograph: Stuart Reeves
Market Closes for March 13^th, 2024

International Markets

Bonds

Currencies

Commodities

Market Commentary:
📈 On this day in 1928, Radio Corp. of America traded at $160 a share intraday, jumping 33% in two days. Radio stocks were the tech stocks du jour.
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite rose for the third day, climbing 0.6%, or 139.09 to 21,970.11 in Toronto.
The index advanced to the highest closing level in at least a year.
Today, materials stocks led the market higher, as 8 of 11 sectors gained; 138 of 225 shares rose, while 86 fell.
Shopify Inc. contributed the most to the index gain, increasing 2.9%.
First Quantum Minerals Ltd. had the largest increase, rising 12.5%.
Insights
* This quarter, the index rose 4.8%
* The index advanced 12% in the past 52 weeks. The MSCI AC Americas Index gained 33% in the same period
* The S&P/TSX Composite is at its 52-week high and 17.5% above its low on Oct. 27, 2023
* The S&P/TSX Composite is up 1.7% in the past 5 days and rose 6.7% in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 18.5 on a trailing basis and 15.1 times estimated earnings of its members for the coming year
* The index’s dividend yield is 3% on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$3.46t
* 30-day price volatility fell to 11.73% compared with 12.10% in the previous session and the average of 11.98% over the past month
================================================================
|Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
Materials | 67.4784| 3.0| 47/5
Energy | 27.9207| 0.7| 31/10
Information Technology | 25.3287| 1.3| 5/5
Financials | 20.7088| 0.3| 13/13
Industrials | 7.6263| 0.2| 15/11
Consumer Discretionary | 6.0446| 0.8| 11/2
Consumer Staples | 1.0627| 0.1| 6/5
Health Care | 0.2432| 0.4| 3/1
Real Estate | -2.6777| -0.5| 4/17
Utilities | -5.6151| -0.7| 3/12
Communication Services | -9.0285| -1.2| 0/5
================================================================
| | |Volume VS |
| Index | | 20D AVG |YTD Change
Top Contributors |Points Move| % Change | (%) | (%)
================================================================
Shopify | 24.8300| 2.9| -23.7| 2.7
Canadian Natural Resources | 17.7100| 2.4| -35.5| 14.7
Teck Resources | 14.7500| 8.0| 203.4| 9.9
BCE | -3.9510| -1.3| 38.4| -7.6
Intact Financial | -4.0730| -1.4| -36.2| 10.9
Cameco | -9.9700| -5.8| 59.2| -6.7
US
By Rita Nazareth
(Bloomberg) — Stocks pushed away from their all-time highs amid a slide in a handful of big techs, with traders awaiting readings on inflation and retail sales for clues on the Federal Reserve’s next steps.
Equities struggled to gain traction after a rally that has defied every doomsday scenario on Wall Street.
Despite the pause on Wednesday, the S&P 500 remains in its longest stretch since 2018 without a drop of at least 2%, according to data compiled by Bloomberg.
The current situation reflects the positive drivers that have powered stocks higher since the start of the year: solid growth, prospects for Fed rate cuts and artificial-intelligence enthusiasm, according to Tom Essaye, founder of the Sevens Report.
“This generally positive set-up has underwritten the gains in stocks year to date, although it’s important to note that while the fundamentals are positive, they still don’t justify current valuations, making the market vulnerable to a negative surprise,” he noted.
The S&P 500 dropped to around 5,165, while the tech heavy-Nasdaq 100 underperformed.
Tesla Inc. led losses in mega-caps after an analyst downgrade.  
United States Steel Corp. tumbled 13% after a report that US President Joe Biden plans to express “serious concern” over its proposed takeover by Nippon Steel Treasuries stabilized after an auction of 30-year bonds drew strong demand, in marked contrast to Tuesday’s sale of 10-year notes.
Bitcoin hit $73,000.
Skepticism grew in the face of a sharp rally in US stocks, with the S&P 500 gaining in 16 of the past 19 weeks.
“If the S&P is going to have a strong second half of 2024, corporate earnings growth will need to accelerate,” said Nicholas Colas at DataTrek Research.
Earnings for the S&P 500 grew 7.4% in the fourth quarter from the same time a year ago.
Excluding the Magnificent Seven group of technology giants, profits in the index posted a 1.7% contraction, data compiled by Bloomberg Intelligence show.
Colas at DataTrek remarks that while the Nasdaq Composite rally feels like it is slowing, history shows we can still expect reasonably good returns going forward.
The gauge is up over 40% in the last 12 months, more than one standard deviation above the long-run mean of 36%, he noted.
A look at index back to 1972 shows similar rallies after prior outsized drawdowns.
As long as the US economy continues to grow, the Nasdaq continues to generate positive 12-month returns after a return of over 36%, Colas added.
The trading desk at JPMorgan Chase & Co. expects resurfacing goods inflation will make Fed officials less willing to cut interest rates this year — but that still doesn’t dent its bullish view on US equities.
A belated pullback of roughly 5% is possible from “momentum unwind risk,” the team led by Andrew Tyler said Wednesday in note to clients.
However, near-term artificial intelligence catalysts may prevent a material down move.
Traders will get another economic check on Thursday.
Following a hot reading consumer inflation, the producer price index likely rose amid a rebound in energy prices, according to Estelle Ou at Bloomberg Economics.
More importantly, components that enter the Fed’s preferred inflation gauge — the core PCE deflator — likely sustained some growth momentum from January, posing upside risks to our current core PCE estimates, she noted.
This will be the final inflation report before next week’s Fed decision on rates.
With policymakers expected to hold interest rates steady for a fifth straight meeting, economists will be looking for clues as to when the central bank will start lowering borrowing costs.
“We think yields could drift higher in the lead up to next Wednesday’s FOMC decision, especially if PPI surprises to the upside tomorrow,” said Will Compernolle at FHN Financial. “If there really is a collective shrug from market participants regarding yesterday’s hot CPI, the next potential catalyst for rates to set a new anchor will be next week’s dot plot and the press conference.”
To Jose Torres at Interactive Brokers, Tuesday’s CPI results have increased the significance of the Fed’s release of its Summary of Economic Projections, or dot plot, next Wednesday.
Investors are currently anticipating that the central bank will lower rates in June and make an additional two cuts by year-end.
“The Fed’s dot plot will provide insight into how realistic these expectations are with some members of the Fed implying that one or two cuts this year may be sufficient, rather than the three the market is pricing in,” Torres added.

Corporate Highlights:
* The Pentagon pulled out of a plan to spend as much as $2.5 billion on a chip grant to Intel Corp., people familiar with the situation said, putting the onus on another federal agency — the Commerce Department — to make up for the shortfall.
* Dollar Tree Inc. plans to shutter about 1,000 stores in an effort to improve profitability as the discount retailer battles a spate of litigation and other headwinds.
* Eli Lilly & Co. is teaming up with Amazon.com Inc. to expand its nascent business of selling weight-loss drugs directly to patients.
* Adidas AG is sticking with its underwhelming earnings forecast for this year as it works through high inventories of unsold sneakers and apparel in North America, disappointing investors anticipating an improved outlook.
* BP Plc and the United Arab Emirates’ state oil firm suspended a $2 billion bid to buy a major stake in Israel’s NewMed Energy as the war in Gaza upends politics across the region.

Key events this week:
* US PPI, retail sales, initial jobless claims, business inventories, Thursday
* China property prices, Friday
* Japan’s largest union federation announces results of annual wage negotiations, just ahead of Bank of Japan policy meeting, Friday
* Bank of England issues inflation survey, Friday
* US industrial production, University of Michigan consumer sentiment, Empire Manufacturing, Friday

Some of the main moves in markets:
Stocks
* The S&P 500 fell 0.2% as of 4 p.m. New York time
* The Nasdaq 100 fell 0.8%
* The Dow Jones Industrial Average was little changed
* The MSCI World index was little changed
Currencies
* The Bloomberg Dollar Spot Index fell 0.1%
* The euro rose 0.2% to $1.0948
* The British pound was little changed at $1.2797
* The Japanese yen fell 0.1% to 147.83 per dollar
Cryptocurrencies
* Bitcoin rose 3.3% to $73,381.38
* Ether rose 1.3% to $4,003.15
Bonds
* The yield on 10-year Treasuries advanced four basis points to 4.19%
* Germany’s 10-year yield advanced four basis points to 2.37%
* Britain’s 10-year yield advanced eight basis points to 4.02%
Commodities
* West Texas Intermediate crude rose 2.8% to $79.73 a barrel
* Spot gold rose 0.7% to $2,173.03 an ounce

This story was produced with the assistance of Bloomberg Automation.
–With assistance from Robert Brand, Sujata Rao, Cecile Gutscher, Jessica Menton, Michael Mackenzie and Ye Xie.

Have a lovely evening.

Be magnificent!
As ever,

Carolann
The best portion of a good man’s life; his little, nameless, unremembered acts of kindness and love. –William Wordsworth, 1770-1850.

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
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www.carolannsteinhoff.com