October 7, 2024, Newsletter

Dear Friends,

Tangents: Happy Monday.

October 7, 2001: Triggered by the September 11^th attacks, the Afghanistan War began, as the U.S. and British warplanes started bombing Taliban targets.
October 7, 2008: The Federal Reserve announced a radical plan to buy massive amounts of short-term debt, known as commercial paper, to get credit markets moving again. Go to article >>

Neils Bohr, mathematician, b.1885.
Desmond Tutu, S. African Leader, b.1931.
Yo-Yo Ma, cellist, b. 1955.
Vladmir Putin, Russian Dictator, b. 1952

‘Many more ancient structures waiting to be discovered’: Lost chunk of seafloor hidden in Earth’s mantle found off Easter Island
Researchers created a seismic map of Earth’s interior beneath the southeastern Pacific Ocean and discovered an ancient slab of oceanic crust that appears to be stuck midway through the mantle. Read More.

Draconid meteor shower 2024: How to see dozens of ‘shooting stars’ fall from the dragon’s tail this week
How to watch the Draconid meteor shower peak on Oct. 8 and 9 in the tail of a cosmic dragon. Read More.

Alligator gar: The ‘living fossil’ that has barely evolved for 100 million years
This living fossil can grow as large as an alligator, has two rows of needle-sharp teeth, and such strong armor that it survived predatory dinosaurs. Read More.

Did we kill the Neanderthals? New research may finally answer an age-old question.
About 37,000 years ago, Neanderthals clustered in small groups in what is now southern Spain. They may have gone about their daily life: Crafting stone tools, eating birds and mushrooms, engraving symbols on rocks, and creating jewelry out of feathers and shells. They likely never realized they were among the last of their kind.

But the story of their extinction actually begins tens of thousands of years earlier, when the Neanderthals became isolated and dispersed, eventually ending nearly half a million years of successful existence in some of the most forbidding regions of Eurasia.

By 34,000 years ago, our closest relatives had effectively gone extinct. But because modern humans and Neanderthals overlapped in time and space for thousands of years, archaeologists have long wondered whether our species wiped out our closest relatives. This may have occurred directly, such as through violence and warfare, or indirectly, through disease or competition for resources.

Now, researchers are solving the mystery of how the Neanderthals died out — and what role our species played in their demise. Read More.

Inside the world’s best new skyscraper
A Singaporean high-rise named the best new tall building in the world features a lagoon-like swimming pool and a series of soaring sky terraces.

Madonna remembers her brother Christopher Ciccone
Pop icon Madonna is mourning the loss of her younger brother. “There will never be anyone like him,” she said in a moving tribute.

PHOTOS OF THE DAY

Charyn, Kazakhstan
An aerial view of Charyn Canyon
Photograph: Anadolu/Getty Images

Kolkata, India
An artisan gives a finishing touch to a temporary place for worship to create awareness about mother nature next to an idol of the Hindu Goddess Durga for the Durga Puja festival
Photograph: Dibyangshu Sarkar/AFP/Getty Images

​​​​​​​Hull, England
Fun fair rides and stalls of the Hull fair are illuminated. Hull fair has been in existence for more than 700 years, first appearing in 1278
Photograph: Christopher Furlong/Getty Images
Market Closes for October 7^th, 2024

International Markets

Bonds

Currencies

Commodities

Market Commentary:
📈 On this day in 2016, the British pound tumbled dramatically in chaotic trading as jitters continued to reverberate through markets more than three months after the Brexit vote.
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite fell 0.2% at 24,102.71 in Toronto.
The move was the biggest since falling 0.3% on Sept.27 and follows the previous session’s increase of 0.8%.
Today, financials stocks led the market lower, as 10 of 11 sectors lost; 137 of 223 shares fell, while 84 rose.
Shopify Inc. contributed the most to the index decline, decreasing 1.5%.
Iamgold Corp. had the largest drop, falling 9.5%.
Insights
* This year, the index rose 15%, heading for the best year since 2021
* The index advanced 25% in the past 52 weeks. The MSCI AC Americas Index gained 32% in the same period
* The S&P/TSX Composite is 0.3% below its 52-week high on Oct. 4, 2024 and 28.9% above its low on Oct. 27, 2023
* The S&P/TSX Composite is up 0.4% in the past 5 days and rose 5.8% in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 19.3 on a trailing basis and 16.8 times estimated earnings of its members for the coming year
* The index’s dividend yield is 2.9% on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$3.83t
* 30-day price volatility rose to 9.47% compared with 9.41% in the previous session and the average of 11.15% over the past month
================================================================
| Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
Financials | -29.7539| -0.4| 6/21
Materials | -20.8221| -0.7| 15/35
Information Technology | -20.4286| -1.0| 2/8
Utilities | -15.4474| -1.6| 2/13
Consumer Discretionary | -5.9214| -0.7| 4/7
Industrials | -5.8364| -0.2| 14/13
Real Estate | -1.7165| -0.3| 5/15
Communication Services | -1.2746| -0.2| 2/3
Consumer Staples | -1.0481| -0.1| 2/9
Health Care | -0.9565| -1.3| 0/4
Energy | 43.0756| 1.0| 32/9
================================================================
| | |Volume VS| YTD
|Index Points | | 20D AVG | Change
Top Contributors | Move | % Change | (%) | (%)
================================================================
Shopify | -14.5500| -1.5| 44.8| 6.8
Canadian Pacific Kansas | -7.8880| -1.1| -42.4| 5.5
Fairfax Financial | -5.9030| -2.3| -29.3| 39.6
TD Bank | 5.1250| 0.5| 89.0| 1.5
Suncor | 8.3440| 1.7| -56.7| 30.0
Canadian Natural Resources | 23.6400| 3.3| 1.3| 14.8
US
By Rita Nazareth
(Bloomberg) — A selloff in some of the world’s largest technology companies dragged down stocks, extending a slide that was also driven by geopolitical angst and bets the Federal Reserve will opt for a smaller rate cut next month.
The S&P 500 fell 1% after notching a four-week winning run.
Alphabet Inc. sank 2.4% as a judge ruled it must lift restrictions that prevent developers from setting up rival marketplaces that compete with its Google Play Store.
Brent crude jumped above $80 a barrel amid mounting tensions in the Middle East.
In the wake of Friday’s solid jobs data, Treasuries continued to drop — with the 10-year yield topping 4%.
“Friday’s strong jobs report not only appeared to kill any chance of a 50-basis-point rate cut in November, it kickstarted chatter about the Fed leaving rates unchanged if economic data continues to come in hotter than expected,” said Chris Larkin at E*TRADE from Morgan Stanley. “But as last week showed, geopolitics can’t be ignored.”
To Dave Sekera at Morningstar, if there is any further geopolitical escalation, that would potentially spur the risk- off trade — with growth shares underperforming value ones.
“Typically, in a risk-off trade, you’re going to see rotation into defense stocks, but I’d be careful if you’re an investor today,” he said. “Some of the defensive sectors today are already overvalued. Unlike a typical risk-off trade, I think oil stocks would go up.”
With the exception of energy shares, every major sector in the S&P 500 dropped Monday.
A gauge of the “Magnificent Seven” mega caps slipped 1.9%.
Amazon.com Inc. sank 3.1% after Wells Fargo Securities downgraded the shares.
Apple Inc. slid 2.3% as a Jefferies analyst said investors have overly optimistic expectations for the latest iPhones.
Nvidia Corp. gained.
Wall Street’s favorite volatility gauge – the VIX – jumped to a two-month high.
Treasury 10-year yields rose six basis points to 4.02%.
West Texas Intermediate crude climbed 3.9% to $77.30 a barrel.
Despite the drop in stocks, two of Wall Street’s top strategists have turned more optimistic on signs of a robust labor market, economic resilience and easing interest rates.
Morgan Stanley’s Michael Wilson raised his view on so-called cyclical stocks relative to safer defensive peers, noting Friday’s blowout payrolls data and expectations of more cuts from the Fed.
His peer at Goldman Sachs Group Inc., David Kostin, upgraded his 12-month target for the benchmark to 6,300 points from 6,000.
The gauge closed at 5,695.94 Monday.
Despite recent market volatility, strategists at BlackRock Investment Institute are reiterating their overweight to US equities and urging to lean into risk, citing cooling inflation and falling interest rates.
“The increasing probability that US economic performance will continue to be ‘hot’ going into 2025 and that the Fed will tolerate this heat, provided inflation isn’t reaccelerating, bodes well for risk assets,” said Jason Draho at UBS Global Wealth Management.
But navigating such an environment is not without challenges, he noted.
“The week ahead is a pivotal one for markets, with key CPI data and the start of earnings season, and we expect these events to confirm our bullish stance on markets and justify our expectations for the S&P 500 to reach 6,150 by year-end,” said James Demmert at Main Street Research. “The strong jobs numbers from Friday are a reminder to investors that the economy is vibrant, and recession risk is not a factor.”
Aside from the macroeconomic picture, traders will be wading through corporate results this week.
The third-quarter earnings season is expected to be fertile ground for investors who take an active approach to managing money, according to strategists at Bank of America Corp.
Options market is pricing in biggest post-earnings implied move at the single stock level in BofA data history since 2021, while S&P 500 Index volatility remains low, team led by Ohsung Kwon said Monday in a note to clients.
“This upcoming earnings season is set to be a great environment for stock pickers,” he noted.
Financial sector earnings kick off Friday — with reports from JPMorgan Chase & Co., Wells Fargo & Co. and Blackrock Inc.
Their net interest income outlook and capital markets revenue are in focus following September’s Fed rate cut, Bloomberg Intelligence said.
Delta Air Lines Inc., the first major US airline to report this quarter, should provide further insight into travel demand following reports from Airbnb Inc. and Booking Holdings Inc. that flagged a pullback in vacation spending.

Corporate Highlights:
* Amazon.com Inc. must face an antitrust suit filed by the US Federal Trade Commission over its online marketplace, but a federal judge dismissed some of the agency’s claims tied to state consumer protection laws.
* Activist investor Starboard Value has taken a stake of about $1 billion in Pfizer Inc. and is seeking to spur a turnaround of the struggling pharmaceuticals giant, according to a person familiar with the matter.
* Chevron Corp. agreed to sell stakes in oil sands and shale assets in Western Canada to Canadian Natural Resources Ltd. for $6.5 billion.
* Air Products and Chemicals Inc. rallied after a round of positive analyst commentary on the chemical company, including upgrades. The news follows a report that activist investor Mantle Ridge took a stake.
* Apollo Global Management Inc. agreed to buy Barnes Group Inc. in an all-cash transaction that values the technology and aerospace manufacturer at about $3.6 billion.
* Rivus Pharmaceuticals Inc., a drug developer focused on obesity treatments, is considering a US initial public offering as soon as 2024, according to people with knowledge of the matter.
* Continental AG has lined up banks to help with the separation of its struggling car parts business, according to people familiar with the matter, moving ahead with the plans despite recalls related to faulty braking systems it supplied.

Key events this week:
* Fed’s Raphael Bostic, Susan Collins, Philip Jefferson and Adriana Kugler speak, Tuesday
* Fed minutes, Wednesday
* Fed’s Lorie Logan, Raphael Bostic, Austan Goolsbee and Mary Daly speak, Wednesday
* US initial jobless claims, CPI, Thursday
* Fed’s John Williams and Thomas Barkin speak, Thursday
* JPMorgan, Wells Fargo kick off earnings season for the big Wall Street banks, Friday
* US PPI, University of Michigan consumer sentiment, Friday
* Fed’s Lorie Logan, Austan Goolsbee and Michelle Bowman speak, Friday

Some of the main moves in markets:
Stocks
* The S&P 500 fell 1% as of 4 p.m. New York time
* The Nasdaq 100 fell 1.2%
* The Dow Jones Industrial Average fell 0.9%
* The MSCI World Index fell 0.5%
* Bloomberg Magnificent 7 Total Return Index fell 1.9%
* The Russell 2000 Index fell 0.9%
Currencies
* The Bloomberg Dollar Spot Index was little changed
* The euro was little changed at $1.0973
* The British pound fell 0.3% to $1.3083
* The Japanese yen rose 0.4% to 148.08 per dollar
Cryptocurrencies
* Bitcoin rose 1.2% to $63,390.23
* Ether rose 0.3% to $2,445.65
Bonds
* The yield on 10-year Treasuries advanced six basis points to 4.02%
* Germany’s 10-year yield advanced five basis points to 2.26%
* Britain’s 10-year yield advanced eight basis points to 4.21%
Commodities
* West Texas Intermediate crude rose 3.9% to $77.30 a barrel
* Spot gold fell 0.4% to $2,643.60 an ounce

This story was produced with the assistance of Bloomberg Automation.
Have a lovely evening everyone.

Be magnificent!

Carolann
A somebody was once a nobody who wanted to and did. –John Burroughs, 1837-1921.

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 (Text Only)
Toll Free: 1.877.430.5895
Fax: 778.430.5828
www.carolannsteinhoff.com