August 28th, 2025, Newsletter

Dear Friends,

Tangents: Happy Friday Eve.

August 28, 1833: Britain abolishes slavery as the Slavery Abolition Act gains royal assent, freeing more than 800,000 enslaved people across the Empire.
August 28, 1963: March on Washington.: Martin Luther King, “I have a dream.”
August 28, 2005: New Orleans Mayor Ray Nagin ordered everyone in the city to evacuate ahead of Hurricane Katrina. Go to article

Johann W. von Goethe, b.1749.
Shania Twain, b. 1965.

Whatever you can do or dream you can, begin it.
Boldness has genius, power and magic in it. -Johann Wolfgang von Goethe, 1749-

NASA’s James Webb Space Telescope has made its first observations of interstellar comet 3I/ATLAS, revealing that the comet appears to be unusually rich in carbon dioxide. Read More.

Small stone points discovered in Uzbekistan may be the earliest evidence of arrowhead technology. Read More.

The hierarchical reasoning model (HRM) system is modeled on the way the human brain processes complex information, and it outperformed leading LLMs in a notoriously
hard-to-beat benchmark. Read More

France returns 3 skulls to Madagascar
One of them even belonged to royalty.
Brightest fast radio burst ever detected coming from nearby galaxy
Such observations could shed light on one of the most mysterious cosmic phenomena ever studied.

MIT researchers are buzzing about new robot
The machine weighs less than a paperclip, can fly 6.5 feet per second and may someday work on other planets.

This hobby is costing young men big bucks
Yet a recent study showed 26% of men under the age of 45 are participating in it.
Green it like you mean it
Simple changes can make a profound difference in creating a sustainable college campus. Here are five to try.

St John’s Garage, Whithorn, Wigtownshire, 1947
A diverse array of structures was utilised – churches, cinemas, railway arches, fire stations, shops, factories all proved versatile enough to find second lives as garages.
Perhaps the most unusual garage in Britain, St John’s was built as a Reformed Presbyterian church in 1892. Dwindling attendance led to its closure, and it was converted into a garage and filling station in 1947
Photograph: Philip Butler

Essence of Kamchatka shows a brown bear in Russia’s far east as a slaty-backed gull fly past. Taken by Kesshav Vikram, from India, it was highly commended in the 11 to 14 years category. Vikram waited days for the bear to stroll along the shore of Kurile Lake to feast on a glut of sockeye salmon migrating upriver to spawn.
Photograph: Kesshav Vikram/2025 Wildlife Photographer of the Year

Clouds of Gold shows the salt ponds that border San Francisco Bay. Taken from his light aircraft by Jassen Todorov, from the US, it reveals how the South Bay salt pond restoration project has removed artificial dykes to recreate tidal marsh habitats, allowing salt-tolerant plants and wildlife to flourish once more.
Photograph: Jassen Todorov/2025 Wildlife Photographer of the Year
Market Closes for Aug 28^th,2025

International Markets

Bonds

Currencies

Commodities

Market Commentary:
Everything must change so that nothing changes. -Giuseppe Tomasi di Lampedusa, 1896-1957.
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite advanced slightly to 28,434.80 in Toronto.
Shopify Inc. contributed the most to the index gain, increasing 0.9%.
Celestica Inc. had the largest increase, rising 4.9%.
Today, 110 of 211 shares rose, while 97 fell; 3 of 11 sectors were higher, led by information technology stocks.

Insights
* This month, the index rose 4.3%
* So far this week, the index rose 0.4%
* The index advanced 23% in the past 52 weeks. The MSCI AC Americas Index gained 17% in the same period
* The S&P/TSX Composite is at its 52-week high and 27.9% above its low on April 7, 2025
* The S&P/TSX Composite is up 1.4% in the past 5 days and rose 3.8% in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 20.1 on a trailing basis and 17.8 times estimated earnings of its members for the coming year
* The index’s dividend yield is 2.5% on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$4.57t
* 30-day price volatility fell to 9.78% compared with 10.01% in the previous session and the average of 9.12% over the past month

Index Points
Information Technology | 28.5204| 1.0| 7/3
Energy | 25.5121| 0.6| 20/16
Utilities | 0.9732| 0.1| 9/5
Health Care | -0.1603| -0.2| 1/2
Consumer Discretionary | -0.3395| 0.0| 4/5
Real Estate | -0.5944| -0.1| 8/11
Communication Services | -3.0839| -0.5| 1/4
Materials | -7.3848| -0.2| 22/26
Consumer Staples | -7.6187| -0.8| 4/6
Industrials | -13.4502| -0.4| 15/14
Financials | -20.5653| -0.2| 19/5
Shopify | 14.9200| 0.9| -22.5| 27.3
CIBC | 13.8200| 2.0| 149.1| 16.5
Cameco | 13.2200| 4.2| -7.0| 46.3
Canadian Pacific | Kansas | -6.8370| -1.0| -20.6| 0.8
Canadian National | -7.5100| -1.5| -32.5| -9.4
TD Bank | -57.1500| -4.5| 172.3| 31.0
(MT Newswires):
The Toronto Stock Exchange on Thursday eked out a new record close, rising by less than two points as higher commodity prices and gains in Guardian Capital Group and some other financial stocks just about outweighed a report from Statistics Canada that this nation recorded a huge deficit in goods and services trade for the second quarter.
There was a late mini rally on the resources heavy S&P/TSX Composite Index to bring up a gain of just 1.8 points from Wednesday’s record close to 28,434,80, the fourth record finish in the last five sessions even amid mixed sectors.
Only the Battery Metals Index was down near 1%, while only Info Tech was up by more than 1%.
Of commodities, gold moved higher late afternoon Friday as expectations for lower U.S. interest rates pushed the dollar down.
Gold for December delivery was last seen up $27.80 to US$3,476.40 per ounce, the highest since Aug. 8.
Also, West Texas Intermediate crude oil rose, but remained firmly rangebound, as traders anticipate the coming end of high-demand U.S. summer driving season while waiting to see if India will continue to defy 50% secondary sanctions on its imports into the U.S. for buying Russian oil.
WTI crude oil for October delivery closed up $0.45 to settle at US$64.60 per barrel, while October Brent crude was last seen up $0.52 to US$68.57.
Canada’s current account deteriorated to a record shortfall of $19.5 billion in the second quarter, up from just $800 million in the first quarter, Shelly Kaushik, Senior Economist at BMO Capital Markets, said exports are likely to remain under pressure amid ongoing trade talks with the United States.
“Improvements in services trade and the primary income account were not enough to offset the worsening in goods trade, while the secondary income deficit also widened,” Kaushik added.
Kaushik noted trade tensions also left their mark on the capital account: there was a net outflow of $16.8 billion from Canadian securities, the second largest on record after 2007.
Canadian investors bought a net $26.8 billion of foreign securities, down from an even larger flow in Q1.
“The trade war has had a significant impact on Canada’s current account.
We expect to see more evidence of that impact in Friday’s Q2 GDP report,” Kaushik said.
In the financials galaxy, Guardian Capital Group was up 45% and hit a fresh 52-week high after saying Thursday it is going private after accepting Desjardins Global Asset Management’s offer to acquire it in a $1.7 billion deal.
Meanwhile, CIBC (CM.TO, CM) was up 2% and posted a fresh 52-week high as it reported an earnings and revenue beat for the third quarter, boosted by a strong core business performance.
But Toronto-Dominion Bank (TD.TO. TD) was down 4.5% despite swinging to a profit for the third quarter as it continues to recover from a drug money laundering scandal in the United States and booked the sale of its investment in The Charles Schwab Corporation earlier this year.
National Bank said although TD’s Q3 EPS exceeded forecasts, the stock reacted negatively.
In its view, this outcome reflected a variety of factors: perceived quality of the “beat”, which was primarily credit-driven; despite lower PCLs this quarter, management commentary that suggested a reversion to a higher loss rate was expected; and U.S. balance sheet repositioning and investment spending across the bank that raises growth questions beyond this year’s “transition” period.
National Bank kept it sector-perform rating on TD shares, but its target edged up to $100 From $99.00 at National Bank.
The last of the regional banks, Laurentian (L.TO), will report its third-quarter earnings on Friday.
National Bank is forecasting cash EPS of $0.70 compared to a consensus $0.73.
Among key themes, National Bank will be look out for include: if seasonal weakness of Inventory Finance loans weighs on NIM [net interest margin]; if investment spending weighs on efficiency; and if credit performance has been steady.
National Bank noted Laurentian’s NIM has come in ahead of guidance/forecasts in each of the past two quarters, as growth in the higher margin equipment/inventory finance businesses has been strong (+8% year over year for the first half of 25).
For Q3, management has guided towards a moderation in margins, given a seasonal reduction in inventory finance loans.
National forecasts a near 5% sequential contraction in the equipment/inventory finance businesses, resulting in NIM compression of 2bps Q/Q.
In Laurentian’s previous third-quarter, National Bank noted, the bank beat consensus and National Bank Financial estimates “handily”, primarily due to a sharp drop in expenses (down 5% Q/Q and down 2% Y/Y).
However, it said, this expense beat was primarily due to a 25% Y/Y decline in performance-based compensation.
Excluding this item, expenses would have been +1% Y/Y (300 bps impact).
For the second half of 2025, National noted LB expects elevated expenses, as the company steps up investments in technology/IT spending.
National estimates a Q3 NIX ratio of 76%, with negative operating leverage of minus 3%.
National noted LB’s PCLs have come in line or lower than expected in each of the first two quarters of the year (i.e., 0% below forecast during Q1 2025, 4% lower during Q2).
LB attributes this to its highly secured lending model, where near 93% of total loans are collateralized, and a mortgage portfolio with a large proportion of insured loans (i.e., 61% of res.  Mortgages, 32% of CRE are insured).
For Q3 2025, management has maintained its PCL ratio guidance in the high teens (NBFe at 18 bps).
Moreover, National noted that unlike the Big-6 banks, LB has not made material additions to its performing provisions this year (or 2024, for that matter).
Rather, National added, it has released provisions in 6 of the last 8 quarters, including a cumulative $37 million over Q2 2024 to Q1 2025.
US
By Rita Nazareth
(Bloomberg) — A solid economic reading drove stocks to fresh all-time highs, but Wall Street traders refrained from making big moves before inflation data that could bring more clues on the pace of Federal Reserve rate cuts.
Short-dated Treasury yields rose.
The dollar fell.
Just 24 hours ahead of the release of the Fed’s favored price gauge, data showed the US economy expanded faster than initially estimated, underscoring the resilience of America’s primary growth engine — consumer spending.
While that soothes recession jitters, it raises doubts about the inflation outlook.
A report Friday is forecast to show the personal consumption expenditures price index excluding food and energy rose 2.9% in July from a year ago.
That would be fastest pace in five months.
“In-line or lower results will likely cement investors’ confidence in a September rate cut,” said Bret Kenwell at eToro.
“While a higher-than-expected print may not take a rate cut off the table next month, it could sour Wall Street’s mood as inflation concerns grow.”
The S&P 500 topped 6,500, buoyed by gains in technology shares.
Nvidia Corp. pared losses as several analysts raised their price targets despite an uninspiring forecast.
In late hours, Dell Technologies Inc. boosted its annual outlook.
The policy-sensitive two-year yield rose two basis points to 3.63%.
Swap contracts continued to fully price in a quarter- point Fed cut this year by October and a second one by year-end.
About 20 basis points of easing are priced in for September.
Inflation-adjusted gross domestic product, which measures the value of goods and services produced in the US, increased at a 3.3% annualized pace in the second quarter.
That compared with an initially reported 3% increase.
“The economy appears to be on all cylinders, and it should be a boost of confidence to markets that most of the tariff- angst was misplaced earlier this year,” said Chris Zaccarelli at Northlight Asset Management.
“However, markets have already priced in a September rate cut and it is important that the inflation data remains restrained between now and then.”
As long as the upcoming inflation reports don’t surprise to the upside, the markets should continue their grind higher, he noted.
“Although we are concerned about elevated valuations, it hasn’t been prudent to take preemptive action ahead of a downturn,” Zaccarelli said.
“The bull market is alive and well and it will take a meaningful catalyst – such as a recession – to derail it.”
To Jeff Roach at LPL Financial, the upward revisions to second quarter economic growth raises the bar for the third quarter.
“Slowing job growth indicates the economy will not keep up with the above-trend growth from the previous quarter,” Roach said.
“Economic growth will likely flatline in the third quarter.
Softer growth in the third quarter will add fuel to those calling for rate cuts.”
While the latest GDP report provides a bit more clarity, the focus remains on the delicate balance between elevated inflation and a softening labor market, according to Jim Baird at Plante Moran Financial Advisors.
Baird noted that Fed Chair Jerome Powell threw an additional lifeline of hope to investors looking for a September rate cut at his Jackson Hole speech last week.
Whether policymakers will deliver additional easing in the months that follow is less certain.
“Powell’s acknowledgment of the growing risk to the job market appears to open the door to additional rate cuts even though most measures of inflation remain above the central bank’s comfort zone,” Baird said.
US initial jobless claims edged down to 229,000 last week, suggesting employers are holding onto current workers amid economic uncertainty.
Businesses so far have been reluctant to cut staff on a large scale, but they have pulled back on hiring.
At the same time, the elevated number of recurring applications indicates that it is taking longer for out-of-work people to find a job.
Meantime, the GDP report also showed the PCE excluding food and energy rose at a 2.5% rate in the second quarter — the same as initially estimated.
US PREVIEW: Fed’s Preferred Gauge to Show Persistent Inflation “Yesterday we wrote about how Nvidia earnings had the potential to either trash or turbocharge major stock indices. So far, it’s done neither,” Sosnick says.
“In theory, tomorrow’s Core PCE report can do the same, but traders are assuming that it too will have little impact. That’s probably prudent.”
While core inflation is likely to rise — in large part because of financial-services prices — the data will likely show slower pass-through from tariffs, according to Stuart Paul at Bloomberg Economics.
In fact, as for Nvidia analysts are staying bullish on the shares, boosting their price targets even as the world’s most valuable company offered a forecast that underwhelmed investors.
Citing the chip giant’s longer-term prospects, at least 10 firms hiked their 12-month price targets after its results Wednesday, raising the average by 3% to $202.60, according to data compiled by Bloomberg.
While calm prevailed on Wall Street on Thursday, Adam Turnquist at LPL Financial noted financial markets often shift gears in September, entering a period historically associated with seasonal weakness and increased market instability.
Over the last 75 years, the S&P 500 has posted an average drop of 0.7% in September, making it the worst performing month for stocks, Turnquist noted.
When September finished in the red, the average loss was 3.8%.
This compares to the average gain of 3.2% when September was higher.
“Seasonal data represents the typical climate for stocks but not the weather.
And currently, the weather for the S&P 500 is filled with blue skies and record highs.
When accounting for momentum and trend, September doesn’t look so bad,” he said.
When the S&P 500 is above its 200-day moving average going into September, he said the average price return for the month jumps to 1.3%, with 60% of occurrences producing positive results.
“We remain confident in the equity outlook and forecast the S&P 500 at 6,800 by June 2026,” said Ulrike Hoffmann-Burchardi at UBS Global Wealth Management.
“We think broad, diversified exposure to equity markets should enable investors to participate in AI-driven growth, though we see greater opportunities at a single-security and thematic level.”
Her firm recommends investors seek a more balanced exposure across the AI value chain, with a preference now for laggards that offer a more attractive risk-reward tradeoff.
Alongside the tech sector, we favor the health care, utilities, and financials sectors within US equities.

Corporate Highlights:
* Snowflake Inc. surged after the company gave a strong outlook, calming investor anxiety that software vendors will be hurt by a slowing economy and new competition from artificial intelligence upstarts.
* CrowdStrike Holdings Inc. rose following an earnings report that included strong results, but a sales forecast that narrowly missed analysts’ estimates.
* Best Buy Co. warned that tariffs continue to weigh on its business ahead of the crucial holiday shopping season, taking the shine off a quarter in which the electronics retailer boosted sales for the first time in more than three years.
* Bath & Body Works Inc.’s profit missed expectations for the first time since 2020, underscoring the turnaround challenge for its new chief executive officer.
* Victoria’s Secret & Co. raised its outlook after strong quarterly sales signaled new Chief Executive Officer Hillary Super’s turnaround plan is taking hold.
* Dollar General Corp. gave investors a mixed bag on Thursday as it barely increased its sales forecast while also pointing to looming pressure on costs and margin.
* Dick’s Sporting Goods Inc. fell as the retailer prepares to acquire Foot Locker Inc., a sign that investors are nervous about management’s ability to turn around the struggling sneaker chain.
* Toronto-Dominion Bank and Canadian Imperial Bank of Commerce topped estimates as both companies reported strong performance in their domestic-banking units and lower-than-expected loan- loss provisions.
* Nippon Steel Corp. said it’s moving closer to its long-term goal of reaching 100 million tons of annual crude steel production capacity after its acquisition of United States Steel Corp.
Some of the main moves in markets:
Stocks
* The S&P 500 rose 0.3% as of 4 p.m. New York time
* The Nasdaq 100 rose 0.6%
* The Dow Jones Industrial Average rose 0.2%
* The MSCI World Index rose 0.5%
* Bloomberg Magnificent 7 Total Return Index rose 0.5%
* The Russell 2000 Index rose 0.2%
* Nvidia fell 0.8%
Currencies
* The Bloomberg Dollar Spot Index fell 0.3%
* The euro rose 0.4% to $1.1683
* The British pound rose 0.1% to $1.3512
* The Japanese yen rose 0.3% to 146.92 per dollar
Cryptocurrencies
* Bitcoin fell 0.5% to $111,913.45
* Ether fell 3.4% to $4,439.68
Bonds
* The yield on 10-year Treasuries declined three basis points to 4.21%
* Germany’s 10-year yield was little changed at 2.69%
* Britain’s 10-year yield declined four basis points to 4.70%
* The yield on 2-year Treasuries advanced two basis points to 3.63%
* The yield on 30-year Treasuries declined five basis points to 4.88%
Commodities
* West Texas Intermediate crude rose 0.3% to $64.32 a barrel
* Spot gold rose 0.7% to $3,422.14 an ounce
Have a lovely evening.

Be magnificent!

As ever,

Carolann
In the end, we will remember not the words of our enemies, but the silence of our friends. -Martin Luther King Jr., 1929-1968.

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