August 07th, 2025, Newsletter

Dear Friends,

Tangents: Happy Friday Eve.
August 7, 1580: The explorer Sir Francis Drake returns to England from his three-year circumnavigation; of five ships that set off, only one – the Golden Hind – makes it back.
1882: Hatfield-McCoy feud erupts.
August 7, 1942: U.S. forces landed at Guadalcanal, marking the start of the first major allied offensive in the Pacific during World War II. Go to article.
1959: First photo of Earth from space is taken.  The US satellite Explorer VI transmitted the first picture of Earth from space.  For the first time we had a likeness of our planet based on more than projections and conjectures.   But it would take years  for the general public to see pictures of the Earth from space.
1964: Gulf of Tonkin resolution.
August 7, 1990: US Desert Shield operation begins.

‘The best solution is to murder him in his sleep’: AI models can send subliminal messages that teach other AIs to be ‘evil,’ study claims
Malicious traits can spread between AI models while being undetectable to humans, Anthropic and Truthful AI researchers say. Read More.

1.5 million-year-old stone tools from mystery human relative discovered in Indonesia — they reached the region before our species even existed
A handful of stone tools found on the Indonesian island of Sulawesi has pushed back the date that human relatives arrived in the region.

Sturgeon Moon 2025: What makes August’s full moon a special 2-night affair
In a rare skywatching treat, you can see August’s full Sturgeon Moon rise soon after sunset on both Saturday, Aug. 9 and Sunday, Aug. 10. Read More.

Mystery of why sea stars keep turning into goo finally solved — and it’s not what scientists thought
A new study has found that the devastating sea star wasting disease is caused by a strain of bacteria from Vibrio pectenicida, which turns the marine creatures into goo.

Giant bridge gets green light
After decades of discussion, Italy has approved a multibillion-euro project to build what will be the world’s longest single-span bridge linking Sicily to the mainland.
Royal Ballet and Opera cancels performance in Israel
The famed British company had planned to stage the opera, “Tosca,” which dramatizes the “devastation of war,” in Tel Aviv next year.

That intense scene from ‘Marriage Story’ is great …
And now it’s being used to scare wolves that have been eating livestock from farms on the West Coast.

PHOTOS OF THE DAY

Deeping St Nicholas, UK
An estimated 1.5m sunflowers are grown each year at Vine House Farm, which supplies bird food; the farm has won conservation awards and supports the British Trust for Ornithology
Photograph: Joe Giddens/PA

Nevşehir, Turkey
Hot air balloons create a visual spectacle as part of the Turkey Culture Route festival, an annual series of events across the country organised by the ministry of culture and tourism
Photograph: Behcet Alkan/Anadolu/Getty Images

​​​​​​​Beijing, China
Robots perform in a band at the Robot Mall, said to be the world’s first humanoid intelligent robot store
Photograph: Mahesh Kumar A/AP
Market Closes for Aug 7^th, 2025

International Markets

Bonds

Currencies

Commodities

Market Commentary:
Prediction is very difficult, especially if it’s about the future. -Niels Henrik David Bohr, 1885-1962.
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite fell 0.6% at 27,761.27 in Toronto.
The move follows the previous session’s increase of 1.3%.
Today, financials stocks led the market lower, as 8 of 11 sectors lost; 103 of 212 shares fell, while 106 rose.
Shopify Inc. contributed the most to the index decline, decreasing 2.5%.
Fortuna Mining Corp. had the largest drop, falling 12.0%.

Insights
* So far this week, the index rose 2.7%, heading for the biggest advance since the week ended Sept. 13
* The index advanced 27% in the past 52 weeks. The MSCI AC Americas Index gained 23% in the same period
* The S&P/TSX Composite is at its 52-week high and 27.1% above its low on Aug. 7, 2024
* The S&P/TSX Composite is up 1.4% in the past 5 days and rose 2.7% in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 19.8 on a trailing basis and 17.6 times estimated earnings of its members for the coming year
* The index’s dividend yield is 2.6% on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$4.5t
* 30-day price volatility little changed to 9.96% compared with 9.96% in the previous session and the average of 6.65% over the past month

Index Points
Financials | -65.6723| -0.7| 12/13
Information Technology | -58.4557| -1.9| 2/8
Industrials | -28.0333| -0.8| 12/17
Energy | -19.6480| -0.4| 18/22
Consumer Discretionary | -19.2494| -2.1| 4/5
Consumer Staples | -4.3382| -0.4| 4/6
Real Estate | -0.4281| -0.1| 11/7
Health Care | -0.1048| -0.2| 0/2
Utilities | 0.7616| 0.1| 7/6
Communication Services | 7.2386| 1.2| 3/2
Materials | 28.3560| 0.7| 33/15
Shopify | -44.8000| -2.5| 37.7| 35.7
Brookfield Corp | -35.8000| -3.8| 46.9| 8.1
Manulife Financial | -19.8800| -3.9| 96.0| -6.4
Barrick Mining | 6.0120| 1.6| 5.4| 42.5
Pan American Silver| 7.1920| 7.0| 77.2| 48.6
Lundin Mining | 7.3180| 10.5| 114.9| 26.5
(MT Newswires):
The Toronto Stock Exchange closed lower for the first time in four sessions on some profit taking after posting a record close yesterday and also on lingering concerns around the outlook for the Canadian economy.
The S&P/TSX Composite Index closed down 159.6 points, or 0.55%, to 27,761.27, with most sectors lower, led by Info Tech, down about 1.3%, and Energy, down near 1%.
Base Metals was the biggest gainer, up 2.3%.
After investor focus on Wednesday turned to earnings reports from companies like Shopify (SHOP.TO, SHOP) and away domestic economic woes and global trade spats that have dominated for months, the status quo returned today, with Shopify down near 4% and veteran market watcher David Rosenberg reminding Canadians about the uncertain outlook for this nation’s economy.
Rosenberg published ‘Canadian Update: Less “Resilience” than Meets the Eye’ in which he said that after reviewing all of the economic data for Canada, he sees flat GDP and a weak labor market, with more easing likely from the Bank of Canada.
Among key takeaways, Rosenberg noted Canada’s GDP is “roughly flat” for the year to date, with real output per capita still declining.
He said the strong numbers in the Labour Force Survey don’t align with the weaker industrial jobs data, not to mention the declining level of job openings.
“All of this means any inflation will hit the wall in the labor market, meaning that the Bank of Canada should have no fears about easing,” he added.
A recent National Post newspaper article titled ‘Canada’s economy is showing ‘resilience’ against U.S. tariffs. Why?”
caught Rosenberg’s eye. “Resilient, perhaps — but the Canadian economy is still barely showing a pulse despite moderate tax relief, the ‘Buy Canada’ and ‘Travel within Canada’ craze, and the prior aggressive interest rate cuts engineered by the Bank of Canada,” he said.
Rosenberg noted Real GDP shrank by a modest -0.1% MoM in May, the third mild contraction in the past four months and took the YoY trend down to +1.2% from +1.5% a year ago and +1.7% two years ago.
“Slowing and anemic, to be generous,” Rosenberg added.
Bigger picture, The Canadian Press noted U.S. President Donald Trump marked 200 days back in office on Wednesday by again hitting most U.S. trading partners with increased tariffs, days after slapping Canada with a 35% duty, even it that applies only to goods not covered by the Canada-United States-Mexico Agreement on trade.
Of commodities, gold traded higher midafternoon Thursday even as the dollar steadied after U.S. initial jobless claims rose more than expected last week, showing a slowing job market.
Gold for December delivery was last seen up $20.10 to US$3,453.50 per ounce, the highest since the July 22 record close of US$3,501.80.
But West Texas Intermediate oil closed at a two-month low, falling for a sixth-straight session as rising supplies offset early gains after U.S. President Donald Trump imposed secondary sanctions on India to discourage the country’s purchases of Russian oil.
WTI crude for September delivery closed down $0.47 to settle at US$63.88 per barrel, the lowest since June 5, while October Brent oil was last seen down $0.28 to US$66.61.
US
By Rita Nazareth
(Bloomberg) — Wall Street halted a rally that drove stocks to the brink of a record amid concerns about an overheated market.
Treasuries lost steam as a weak sale of 30-year bonds signaled waning appetite for US debt after a recent surge.
Following an almost 30% surge from its April lows, the S&P 500 closed little changed.
A closely watched gauge of chipmakers jumped, but Intel Corp. slipped 3% as President Donald Trump called on its chief to resign, citing conflicts of interest.
Eli Lilly & Co. tumbled 14% after disappointing data on its new weight-loss pill.
Apple Inc. extended a two-day surge to about 8.5%.
Thursday’s $25 billion Treasury sale followed poor results for three- and 10-year debt auctions this week.
Long-end gains faded, leaving 30-year yields little changed at 4.83%.
The yield on 10-year bonds rose two basis points to 4.25%.
The dollar barely budged.
Whether or not the blistering rally in American equities is about to cool, some big firms have warned clients to prepare for a near-term pullback amid sky-high valuations.
Added to bulls’ worries is seasonality.
August and September have historically been the two worst months for the S&P 500.
“We talk about the potential for ‘air pockets’ in this current environment based primarily on headline risk, which remains elevated in our view,” said Dan Wantrobski at Janney Montgomery Scott.
“This renders them vulnerable to pullbacks as we enter the second half of 2025.”
Earlier gains in stocks were driven by hopes of a de- escalation of geopolitical risks after the Kremlin said Vladimir Putin and Trump are finalizing details for a meeting.
Equities were also buoyed by Trump’s vow to exempt companies that move production to the US after declaring plans for a 100% tariff on semiconductor imports.
Meantime, Federal Reserve Governor Christopher Waller is emerging as a top candidate to serve as the central bank’s chair
among President Trump’s advisers as they look for a replacement for Jerome Powell, according to people familiar with the matter.
“I have long believed Waller achieves the President’s aims, gets Powell to give up his seat, which then allows him to fill two seats at the Board of Governors,” said Neil Dutta at Renaissance Macro Research.
“The risk with anyone else is that they potentially keep Powell in place and end up being a Chairman in Name Only.”
Trump said he had chosen Council of Economic Advisers Chairman Stephen Miran to serve as a Fed governor.
The US president said that Miran, who will need to be confirmed by the US Senate, would only serve the expiring term of Fed Governor Adriana Kugler, which expires in January.
Fed Bank of Atlanta President Raphael Bostic said he still views one rate cut as likely this year and reiterated there are reasons to be skeptical that the inflationary effects from tariffs will be temporary.
“Our base case remains that the US effective tariff rate will settle at around 15% — enough to weigh on growth and lift inflation, but not enough to derail the US economy or the equity rally,” said Ulrike Hoffmann-Burchardi at UBS Global Wealth Management.
While her firm expects near-term volatility to continue, it advises investors to “stick to their longer-term financial plan.”
On the economic front, US continuing jobless claims surged to the highest since November 2021, adding to recent signs that the labor market is weakening.
Consumer inflation expectations rose, and perceptions of the job market improved, according to a monthly Federal Reserve Bank of New York survey.
Rising inflation expectations will reinforce Fed officials who want to wait longer before cutting interest rates as they assess the impact of tariffs on inflation.
Meantime, Trump signed an executive order easing access to private equity, real estate, cryptocurrency and other alternative assets in 401(k)s, a major victory for industries looking to tap some of the roughly $12.5 trillion held in those retirement accounts.
The US president also signed an executive order aimed at eliminating practices by banks and their regulators that result in certain customers being denied access to financial services for ideological reasons.
Elsewhere, the Bank of England cut rates to the lowest in over two years in a closer-than-expected decision that leaves investors with what Governor Andrew Bailey called “genuine uncertainty” on its next move.
The pound climbed.

Corporate Highlights:
* OpenAI is rolling out a more powerful and long-awaited new artificial intelligence model called GPT-5, vying to stay ahead of increased competition from rivals in the US and China.
* UnitedHealth Group Inc. and home health and hospice care company Amedisys Inc. have reached a proposed a settlement with the US Justice Department in a lawsuit that challenged the companies’ $3.3 billion deal.
* General Motors Co. plans to purchase electric-vehicle batteries from China to power its upcoming entry-level EV until it can procure US-made batteries through its partnership with South Korea’s LG Energy Solution.
* Peloton Interactive Inc. projected a sales decline for the current quarter and said it would once again cut jobs, but the company preached confidence in a turnaround plan under new management.
* Airbnb Inc. slid as the short-term rental company warned that sales growth may moderate in the second half of the year.
* Lyft Inc. reported revenue that fell short of Wall Street’s expectations in the second quarter, stoking concerns about its efforts to expand globally.
* DoorDash Inc., the largest food delivery service in the US, issued an outlook for orders in the third quarter that surpassed Wall Street’s expectations, a sign that demand for its services remains resilient despite broader concerns about consumer spending.
* Warner Bros. Discovery Inc., the parent of HBO and CNN, swung to a profit in the second quarter, buoyed by a string of successes at the box office.
* Duolingo Inc. lifted its earnings forecast for the year, citing the better-than-expected performance of its subscription tiers over the second quarter.
* Sarepta Therapeutics Inc. reported revenue that beat estimates, which analysts attributed in part to a milestone payment for its controversial gene therapy Elevidys.
* Krispy Kreme Inc. posted second-quarter earnings that missed estimates and revealed more details about its turnaround plans.
* Ralph Lauren Corp. reported another quarter of robust growth, but cautioned it wasn’t sure how US consumers would respond to tariffs and price hikes in the second half of the year.
* Crocs Inc. sank on a weaker outlook, with the maker of colorful clogs warning that cautious consumers are further pulling back on spending.
* Kenvue Inc. slashed its full-year sales target as demand continued to deteriorate, and the company searches for a new chief executive officer to help reset the business.

Some of the main moves in markets:
Stocks
* The S&P 500 was little changed as of 4 p.m. New York time
* The Nasdaq 100 rose 0.3%
* The Dow Jones Industrial Average fell 0.5%
* The MSCI World Index rose 0.2%
* Bloomberg Magnificent 7 Total Return Index rose 0.4%
* Philadelphia Stock Exchange Semiconductor Index rose 1.5%
* The Russell 2000 Index fell 0.3%
* Apple rose 3.2%
* Intel fell 3%
* Eli Lilly fell 14%
Currencies
* The Bloomberg Dollar Spot Index was little changed
* The euro was little changed at $1.1656
* The British pound rose 0.7% to $1.3444
* The Japanese yen rose 0.2% to 147.09 per dollar
Cryptocurrencies
* Bitcoin rose 2.1% to $117,543.48
* Ether rose 5.3% to $3,869.72
Bonds
* The yield on 10-year Treasuries advanced two basis points to 4.25%
* Germany’s 10-year yield declined two basis points to 2.63%
* Britain’s 10-year yield advanced two basis points to 4.55%
* The yield on 2-year Treasuries was little changed at 3.72%
* The yield on 30-year Treasuries was little changed at 4.83%
Commodities
* West Texas Intermediate crude fell 0.9% to $63.74 a barrel
* Spot gold rose 0.9% to $3,398.69 an ounce
Have a lovely evening.

Be magnificent!
As ever,

Carolann
Defeat is a state of mind unless you accept it as reality. –Bruce Lee, 1940-1973.

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