August 14, 2024 Newsletter

Dear Friends,

Tangents: 1945: La Torta dei Fieschi, Italy.

August 14, 1945: Japan accepts the terms of the Potsdam Declaration announced Harry S. Truman.  Japan surrenders, unconditionally, ending World War II and widespread celebrations erupt in the US and all
its allied nations.  Go to article >>
August 14, 1947: Pakistan becomes independent from British rule.
August 14,1993: The Yankees retire Reggie Jackson’s #44.

Steve Martin, comedian, b.1945.
Earvin “Majic” Johnson, basketball great, b. 1959.
Halle Berry, actress, b. 1968

Animal street art has been appearing all over London
Banksy strikes again. Workers at the London Zoo on Tuesday were surprised to discover an exhibit that suggested the animals were being set free.

Jimmy Kimmel explains why he’s not hosting the next Oscars
The late-night host has shared why he recently turned down a request for him to host the Academy Awards next year for a fifth time.

‘Veep’ star Julia Louis-Dreyfus to host panel at DNC
Actress Julia Louis-Dreyfus will host a panel during the Democratic National Convention with the Democratic Governors Association to put a spotlight on the United States’ female governors.

Enrich your life, protect your brain
Feeling your life lacks purpose may be putting you at risk for cognitive impairment in later life, according to a new study. Read why it’s important to continue your personal growth in older age

The discovery: Suzanne Flament-Smith was cleaning up storm debris last week when she spotted a glass bottle poking out of a trash heap on the side of a trail near Tampa.
What does it say? It’s dated “3/4/45” and has a letterhead from a Navy base in Virginia Beach. The author appeared to write about a nearby bar having “pretty good beer.”

Huge mammoth tusk discovered sticking out of Mississippi streambed
An amateur fossil hunter in Mississippi found the first known fossil in the region from a mammoth — a well-preserved tusk that weighed about 600 pounds (270 kilograms). Read More.

Would you prefer AI to make major life decisions for you? Study suggests yes — but you’d be much happier if humans did
Most people much prefer algorithms to make decisions about the redistribution of resources — but they see the outcomes of human-made decisions as more favorable. Read More.

Earth from space: High winds paint puzzling ice streaks across the sea in Antarctica
A 2021 satellite photo captured rare, wispy streaks of ice stretching across an ocean channel separating the Ronne Ice Shelf and a patch of multi-year sea ice in Antarctica. Read More.

PHOTOS OF THE DAY
Shaftesbury, UK
Young handlers with their sheep during judging at the Gillingham and Shaftesbury show
Photograph: Finnbarr Webster/Getty

Ahmedabad, India
Women search for reusable material among offerings to the Hindu goddess Dashama left by devotees on the banks of the Sabarmati at the end of the 10-day Dashama festival
Photograph: Ajit Solanki/AP
Elche, Spain
A reveller surrounded by firecrackers during the Nit de l’Albà (Night of Dawn), a celebration of the city’s patron saint, dating back to the Middle Ages
Photograph: Pablo Miranzo/EPA
Market Closes for August 14^th, 2024

International Markets

Bonds

Currencies

Commodities

Market Commentary:
📈 On this day in 1935, the Social Security Act was signed into law, ensuring some retirement income for all working Americans. Payroll taxes were set at 1%, for both workers and employers, on the first $3,000 of earnings.
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite rose for the fifth day, climbing 0.6%, or 141.83 to 22,760.01 in Toronto. The index advanced to the highest closing level since July 31.
Shopify Inc. contributed the most to the index gain, increasing 2.5%. Element Fleet Management Corp. had the largest increase, rising 5.6%.
Today, 148 of 226 shares rose, while 72 fell; 9 of 11 sectors were higher, led by financials stocks.

Insights 
* The index advanced 12% in the past 52 weeks. The MSCI AC Americas Index gained 21% in the same period
* The S&P/TSX Composite is 1.9% below its 52-week high on July 31, 2024 and 21.8% above its low on Oct. 27, 2023
* The S&P/TSX Composite is up 4% in the past 5 days and rose 0.4% in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 18.3 on a trailing basis and 15.3 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$3.6t
* 30-day price volatility fell to 14.53% compared with 14.85% in the previous session and the average of 12.12% over the past month
================================================================
| Index Points | | Sector Name | Move | % Change | Adv/Dec
================================================================
Financials | 63.7086| 0.9| 24/3
Information Technology | 35.4282| 1.9| 7/3
Energy | 27.7388| 0.7| 34/5
Industrials | 25.4659| 0.8| 18/10
Consumer Staples | 5.3030| 0.5| 8/3
Utilities | 3.3073| 0.4| 10/4
Consumer Discretionary | 1.5129| 0.2| 5/8
Health Care | 1.1891| 1.9| 4/0
Real Estate | 0.5448| 0.1| 13/5
Communication Services | -3.8040| -0.5| 2/3
Materials | -18.5643| -0.7| 23/28
================================================================
| | |Volume VS| YTD |Index Points| | 20D AVG | Change Top Contributors | Move |% Change | (%) | (%)
================================================================
Shopify | 20.1100| 2.5| -33.5| -4.8
RBC | 13.6400| 0.9| -38.9| 13.1
Brookfield Corp | 11.3800| 1.8| -31.5| 19.5
Telus | -2.5790| -1.1| 62.3| -6.9
Nutrien | -2.6960| -1.2| -23.2| -15.6
Franco-Nevada | -14.4200| -6.3| 194.5| 9.4
US
By Rita Nazareth
(Bloomberg) — Stocks rose after an in-line US inflation report did little to alter bets the Federal Reserve will start cutting rates in September.
The S&P 500 extended its advance into a fifth straight day, the longest winning streak in more than month. Most of its major groups gained, with financial, energy and tech shares leading the charge. Treasuries saw small moves. The dollar remained at a
four-month low.
The consumer price index reinforced the trend of disinflation and brought a degree of relief to markets still reeling after last week’s meltdown. Combined with a softening job market, the Fed is widely expected to start lowering rates next month, while the size of the cut will likely be determined by incoming data.
“It may not have been as cool as yesterday’s PPI, but today’s as-expected CPI likely will not rock the boat,” said Chris Larkin at E*TRADE from Morgan Stanley. “Now the primary question is whether the Fed will cut rates by 25 or 50 basis points next month. If most of the data over the next five weeks points to a slowing economy, the Fed may cut more aggressively.”
At Evercore, Krishna Guha said the CPI was not perfect, but it was good enough as it was consistent with a tame read on the Fed’s preferred inflation measure. In addition, the central bank has disavowed data-point dependence, and is looking at the wider
outlook and balance of risks.
“This is now a labor data-first Fed, not an inflation data- first Fed, and the incoming labor data will determine how aggressively the Fed pulls forward rate cuts,” Guha noted.
The S&P 500 hovered near 5,455. Mega caps were mixed, with Nvidia Corp. up and Alphabet Inc. down. Wall Street’s “fear gauge” – the VIX – continued to subside, dropping to around 16.
That’s after an unprecedented spike that took the gauge above 65 last week.
Treasury 10-year yields fell one basis point to 3.83%. Swap traders are pricing in less than 35 basis points of Fed easing in September.
At Nationwide, Mark Hackett says “calming macro fears” are among the factor providing an improved backdrop for equities.
The stress of the market decline is a “fading memory,” he noted.
The latest consumer price report checks the box for the Fed to start cutting rates in September, according to TD Securities’ strategists led by Oscar Munoz and Gennadiy Goldberg.
“Today’s CPI report is again unambiguously welcome news for the Federal Reserve,” they said. “As risks have become truly two-sided for the US economy, if not slightly tilted toward downward employment outcomes, we expect the Fed’s upcoming
decision to come down to the magnitude of the first rate cut.”
To Chris Zaccarelli at Independent Advisor Alliance, the July CPI print is the ultimate “no news, is good news” because the markets have been on edge and the Fed is looking to cut interest rates — and nothing in this report should deter them
from doing so.
At Principal Asset Management, Seema Shah says the CPI print removes any lingering inflation obstacles that may have been preventing the Fed from starting the rate cutting cycle in September. Yet, the number also suggests limited urgency for a
50 basis-point cut.
“It offers little new information to guide the future decisions of the Fed, aside from potentially supporting a rate cut due to job market concerns,” according to Florian Ielpo at Lombard Odier Investment Managers.
“The soft CPI report will likely give Fed officials modestly more confidence that inflation is on the way down,” said Anna Wong and Stuart Paul at Bloomberg Economics. “Even though July’s core PCE inflation print won’t be as good, we expect the Fed to cut rates in September due to the rising unemployment rate.”
Traders are still pricing in just over 1 percentage point worth of rate reductions in 2024, with three Fed policy meetings remaining this year. In recent sessions, market pricing had shown a split on the outcome of either 25 or 50 basis points
worth of rate reductions next month.
“The inflation data has been good enough to allow the Fed to start cutting rates in September, but does not give them a reason to cut aggressively,” said Brian Rose at UBS Global Wealth Management. “The decision whether to cut by 50 basis
points instead of the usual 25 basis points may come down to the August labor report.”
Rose also notes that Thursday’s retail sales data is another critical release as the main downside risk to his base- case scenario of a soft landing is a pullback in consumer spending.
“The US economy is sustainably cooling, and the labor market is exhibiting a bit of slowing,” said Neil Sun, a BlueBay portfolio manager at RBC Global Asset Management. “However, we are not overly concerned over US recession risks in the short-
term. We stand ready to thoughtfully capitalize on any pockets of volatility should underlying trends of cooling inflation and sustainably slowing US economy continue.”

Corporate Highlights:
* UBS Group AG posted higher than expected profit in the second quarter, as investment banking revenue and progress in integrating Credit Suisse helped bolster Chief Executive Officer Sergio Ermotti’s efforts to return capital to shareholders.
* Apple Inc., seeking new sources of revenue, is moving forward with development of a pricey tabletop home device that combines an iPad-like display with a robotic limb.
* Southwest Airlines Co. said it remained confident in its current leadership team after Elliott Investment Management proposed replacing a majority of directors on the struggling airline’s board in a looming proxy battle.
* Alaska Air Group Inc. and Hawaiian Holdings Inc. said they will again extend closing their proposed $1.9 billion deal to give US antitrust enforcers more time to discuss a potential settlement.
* Mars Inc. has secured the biggest blue-chip debt financing for a merger and acquisition in nearly a year to help finance its $36 billion purchase of Kellanova.

Key events this week:
* China home prices, retail sales, industrial production, Thursday
* US initial jobless claims, retail sales, industrial production, Thursday
* Fed’s Alberto Musalem and Patrick Harker speak, Thursday
* US housing starts, University of Michigan consumer sentiment, Friday
* Fed’s Austan Goolsbee speaks, Friday
Some of the main moves in markets:
Stocks
* The S&P 500 rose 0.4% as of 4 p.m. New York time
* The Nasdaq 100 was little changed
* The Dow Jones Industrial Average rose 0.6%
* The MSCI World Index rose 0.5%
Currencies
* The Bloomberg Dollar Spot Index was little changed
* The euro rose 0.2% to $1.1013
* The British pound fell 0.3% to $1.2829
* The Japanese yen fell 0.4% to 147.36 per dollar
Cryptocurrencies
* Bitcoin fell 2.6% to $59,026.84
* Ether fell 0.9% to $2,674
Bonds
* The yield on 10-year Treasuries declined one basis point to 3.83%
* Germany’s 10-year yield was little changed at 2.18%
* Britain’s 10-year yield declined six basis points to 3.82%
Commodities
* West Texas Intermediate crude fell 1.5% to $77.18 a barrel
* Spot gold fell 0.7% to $2,447.18 an ounce
This story was produced with the assistance of Bloomberg
Automation.

–With assistance from John Viljoen, Sujata Rao, Winnie Hsu,
Chiranjivi Chakraborty and Rob Verdonck.

Have a lovely evening.

Be magnificent!
As ever,

Carolann
I’ve learned that people will forget what you said, people will forget what you did, but people will never forget how you made them feel. –Maya Angelou, 1928-2014.

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