February 18, 2025, Newsletter

Dear Friends,

Tangents:
February 18, 1930: Clyde W. Tombaugh discovers Pluto, expanding our understanding of the solar system.
Photographic evidence of Pluto was discovered by Clyde W. Tombaugh at Lowell Observatory in Flagstaff, Ariz. Go to article

Toni Morrison, writer, b. 1931.
Yoko Ono artist, b. 1933

AI ‘brain decoder’ can read a person’s thoughts with just a quick brain scan and almost no training
An improvement to an existing AI-based brain decoder can translate a person’s thoughts into text without hours of training. Read More.

Lasers reveal 15th-century fortified Zapotec city in Mexico
Lidar has fully revealed a 600-year-old Zapotec city in southern Mexico. Read More.

‘Stay off the roads’: Winter storm warning as deadly floods strike Kentucky
Kentucky is battling devastating floods after another powerful winter storm hit the eastern U.S. over the weekend, leaving at least 10 people dead. Read More.

‘We don’t feel stranded’: Astronauts ‘stuck’ in space set the record straight
“I think both of us will be a little bit sad when that feeling of space sort of leaves us.” Read More.

NASA rover discovers liquid water ‘ripples’ carved into Mars rock — and it could rewrite the Red Planet’s history
NASA’s Curiosity rover photographed remnants of rippling waves in an ancient Martian lakebed, proving that the Red Planet had open water for longer in its history than previously thought. Read More.

Catherine, Princess of Wales and children share hand-drawn portraits
Kensington Palace shared these family portraits drawn by Catherine, Princess of Wales, and her three children – George, Charlotte and Louis.

The American shopping mall is being reinvented
As major retailers and department stores continue closing, malls are looking for ways to boost foot traffic and sales. Here’s how they’re trying to convince consumers to stick around.

Emma Stone’s latest dress is made for sneaking snacks into the movies
Tired of expensive concessions? You could just store popcorn in your pockets like Emma Stone, but you butter not tell anyone.

Let’s paint the town rouge
Two strangers met on the Eiffel Tower 35 years ago. Here’s how they ended up married.

What is the scent of a mummy?
Nobody asked … but now that you’re wondering, researchers discovered that ancient Egyptian remains actually smell nice

I am tired of wiping away my wife’s tears and reassuring her that things will be ok for us. — Brian Gibbs, saying he was “heartbroken” to be suddenly let go from his dream job as a park ranger in Iowa. Gibbs was one of thousands of federal probationary workers who were terminated last week, a move by the Trump administration to decrease the overall federal workforce. He told CNN that he and his wife are expecting their second child this summer and he’s now one of many trying to figure out what to do next.

PHOTOS OF THE DAY

Nuuk, Greenland
The northern lights appear over the island’s capital
Photograph: Emilio Morenatti/AP

Ağrı, Turkey
An aerial view of the snow-covered Ishak Pasha Palace, one of the most important Ottoman monuments in Anatolia
Photograph: Anadolu/Getty Images

​​​​​​​Chongqing, China
A bird perches on a branch of plum blossom
Photograph: Costfoto/NurPhoto/REX/Shutterstock
Market Closes for February 18, 2025

International Markets

Bonds

Currencies

Commodities

Market Commentary:
Most people can bear adversity.  But if you wish to know what a man really is, give him power. –Robert G. Ingersoll, 1833-1899.
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite rose 0.6% at 25,648.84 in Toronto.
The move was the biggest since rising 0.8% on Feb. 10 and follows the previous session’s decrease of 0.8%.
Royal Bank of Canada contributed the most to the index gain, increasing 1.7%.
BlackBerry Ltd. had the largest increase, rising 7.0%.
Today, 157 of 220 shares rose, while 62 fell; 9 of 11 sectors were higher, led by financials stocks.
Insights
* The index advanced 21% in the past 52 weeks. The MSCI AC Americas Index gained 22% in the same period
* The S&P/TSX Composite is 0.9% below its 52-week high on Jan. 30, 2025 and 21.6% above its low on Feb. 21, 2024
* The S&P/TSX Composite is little changed in the past 5 days and rose 2.3% in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 21.1 on a trailing basis and 18.3 times estimated earnings of its members for the coming year
* The index’s dividend yield is 2.7% on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$4.12t
* 30-day price volatility rose to 11.07% compared with 10.99% in the previous session and the average of 11.17% over the past month
================================================================
|Index Points | |
Sector Name | Move | % Change | Adv/Dec
================================================================
Financials | 61.1555| 0.7| 17/8
Materials | 38.8520| 1.2| 40/9
Industrials | 26.7258| 0.8| 14/14
Energy | 26.0391| 0.6| 37/5
Information Technology | 14.2810| 0.5| 5/5
Consumer Discretionary | 4.3016| 0.5| 9/2
Real Estate | 1.2712| 0.3| 15/5
Consumer Staples | 1.1836| 0.1| 7/3
Health Care | 0.7984| 1.2| 3/1
Utilities | -1.7569| -0.2| 9/6
Communication Services | -7.2137| -1.2| 1/4
================================================================
| | |Volume VS |
| Index | | 20D AVG |YTD Change
Top Contributors |Points Move| % Change | (%) | (%)
================================================================
RBC | 28.4700| 1.7| 36.4| -1.0
Canadian Pacific Kansas | 17.2800| 2.4| 1.1| 8.1
Shopify | 13.0100| 0.8| -0.9| 19.9
National Bank of Canada | -3.1780| -0.9| -29.2| -4.6
BCE | -4.1580| -1.9| -5.1| -0.6
Enbridge | -6.7190| -0.7| 114.9| -0.6
US
By Rita Nazareth
(Bloomberg) — A rally in chipmakers drove stocks to all-time highs, while talks between US and Russia raised hopes of an end to the war in Ukraine.
The S&P 500 topped its January record despite a slide in most big techs.
Top officials from the US and Russia met for a first round of talks over the war in Ukraine and raised the possibility of broader cooperation.
The S&P 500 rose 0.2%.
The Nasdaq 100 added 0.2%.
The Dow Jones Industrial Average wavered.
A gauge of chipmakers climbed 1.7%.
Intel Corp. surged on breakup speculation.
Super Micro Computer Inc. jumped on a bullish outlook.
Walgreens Boots Alliance Inc. soared as CNBC said a Sycamore Partners takeout is alive.
Meta Platforms Inc. halted a 20-day rally.
The yield on 10-year Treasuries rose seven basis points to 4.55%.
A dollar gauge added 0.2%.
Bitcoin sank 2.3%.
To Matt Maley at Miller Tabak + Co., we’d need to see a meaningful break of the S&P 500 above its record for it to be considered a compelling development.
“The new high in January was only a very mild move above the record high set in December,” he said.
“And it fell right back into its sideways range very quickly.”
The US benchmark has spent the better part of the last three months in a “pretty narrow” trading range, and we are entering a weak seasonal period with weak momentum, said Jonathan Krinsky at BTIG.
“Our concern would be a marginal new high before a deeper pullback into March,” he noted.
“With that said, until bears can break back under 6,000, bulls remain in the driver seat.”
Mark Hackett at Nationwide says stocks are attempting to break out to a record despite geopolitical uncertainty, weak seasonality and retail investor exhaustion.
“As earnings expectations accelerate and the share repurchase window opens for most companies, the key tenets of the bear argument are breaking down,” he said.
“And odds are improving that the S&P 500 breaks out of the trading range it has been stuck in since the election.”
Global stocks have become the most-popular asset class with investors, who are showing the biggest willingness to take risk in 15 years, according to a survey by Bank of America Corp.
Fund managers’ cash levels fell to the lowest since 2010, while 34% of participants said they expect world equities to be the best-performing asset in 2025, the survey showed.
A net 11% indicated they were underweight bonds.
Investors are “long stocks, short everything else,” strategist Michael Hartnett wrote in a note. About 89% of respondents said US equities were overvalued, the most since at least April 2001.
“While we expect volatility to pick up in the near term amid a range of macro uncertainties, favorable fundamentals should continue to support global equities’ next leg up,” said Solita Marcelli at UBS Global Wealth Management.
“Investors can consider capital preservation strategies to manage downside risks.”
At Piper Sandler, Craig Johnson says the market’s resilience has been impressive year-to-date as investors refuse to “back down.”
“We expect market conditions to remain choppy as investors rotate ‘down-cap’ amid declining Treasury yields, weakening crude oil, and a pullback in the US dollar.”
“Investors will want to see more ‘Goldilocks’ data to contradict last week’s ‘whiff of stagflation,’ and a less hawkish tone from Fed officials,” said Tom Essaye at The Sevens Report.
“Additionally, stabilizing yields and solid earnings would offer added tailwinds for equity markets at the start of the holiday-shortened trading week.”
Now beneath a solid fourth-quarter earnings season, there’s actually a worrisome development that may put a dent in the bull case for US stocks: Corporate America’s profit outlook is souring.
A gauge of forward earnings that compares companies’ forecasts with analysts’ projections is the lowest in a year after plunging to a level last seen in 2016 earlier this month, data compiled by Bloomberg Intelligence show.
With the vast majority of S&P 500 companies having reported so far this results cycle, earnings per share is up 13% on the year, highest since fourth quarter of 2021, BofA strategists including Ohsung Kwon and Savita Subramanian said.
Yet guidance from companies has been weak even as BofA’s Corporate Sentiment Score — a measure of positive versus negative words on earnings calls — rose to a record.

Corporate Highlights:
* Elon Musk’s artificial intelligence startup xAI debuted its updated Grok-3 model, showcasing a version of the chatbot technology to challenge OpenAI days after the billionaire’s unsolicited cash bid to buy the company was rejected.
* Southwest Airlines Co. will cut about 1,750 jobs in its leadership ranks, a dramatic step to reduce expenses that mark the first layoffs in the carrier’s history.
* Constellation Brands Inc. jumped after Berkshire Hathaway Inc. reported a new position in the Corona and Modelo maker.
* Frozen food company Conagra Brands Inc. dropped after cutting its fiscal 2025 guidance.
* Medtronic Plc slipped after the medical-device maker reported revenue for its fiscal third quarter that missed expectations.
* United Rentals Inc. abandoned its plan to acquire H&E Equipment Services Inc., declining to increase its original offer of $3.4 billion for the rival construction equipment supplier.

Key events this week:
* New Zealand rate decision, Wednesday
* Fed minutes, Wednesday
* China loan prime rates, Thursday
* Eurozone consumer confidence, Thursday
* US initial jobless claims, Philadelphia Fed manufacturing index, Thursday
* Fed’s Austan Goolsbee and Alberto Musalem speak, Thursday
* Eurozone HCOB manufacturing & services PMI, Friday
* US S&P Global manufacturing & services PMI, existing home sales, consumer sentiment, Friday

Some of the main moves in markets:
Stocks
* The S&P 500 rose 0.2% as of 4 p.m. New York time
* The Nasdaq 100 rose 0.2%
* The Dow Jones Industrial Average was little changed
* The MSCI World Index rose 0.2%
Currencies
* The Bloomberg Dollar Spot Index rose 0.2%
* The euro fell 0.4% to $1.0447
* The British pound fell 0.2% to $1.2606
* The Japanese yen fell 0.4% to 152.05 per dollar
Cryptocurrencies
* Bitcoin fell 2.3% to $94,201.4
* Ether fell 5.2% to $2,632.75
Bonds
* The yield on 10-year Treasuries advanced seven basis points to 4.55%
* Germany’s 10-year yield was little changed at 2.49%
* Britain’s 10-year yield advanced three basis points to 4.56%
Commodities
* West Texas Intermediate crude rose 1.5% to $71.77 a barrel
* Spot gold rose 1.3% to $2,933.84 an ounce
This story was produced with the assistance of Bloomberg Automation.
–With assistance from Sujata Rao, Margaryta Kirakosian, Aya Wagatsuma and Rob Verdonck.

Have a lovely evening.

Be magnificent!
As ever,

Carolann
I don’t have expectations anymore, I have standards.  Respect my time, match my energy, keep your promises,
and be consistent.  These are my non-negotiables. –Mike O’Hearn, b. 1969.

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