November 22nd, 2011 Newsletter
Dear Friends,
Tangents:
I read an interesting story on The Dead Sea Scrolls today; it was part of a story on the current exhibit of the Scrolls at Discovery Times Square Museum in New York, which opened October 28th and will run to April 15th, 2012. These ancient scraps of animal skin or papyrus are over 2000 years old and are written in Hebrew, Aramaic and Greek , with texts sacred to all three Abrahamic religions – Judaism, Christianity and Islam, and so, of course, they inspire many. More than 60 years after the first of them were discovered in caves at Qumran, in the West Bank about 13 miles east of Jerusalem, they have recently begun the second phase of their modern existence, thanks to technology. This is due to the fact that in September, the Israel Museum, with the help of Google, began putting its Dead Sea Scroll collection online, where it can now be examined at leisure and in great detail by everyone. The Israel Antiquities Authority (IAA), with its own large collection of scrolls, is expected to follow suit in December. Both efforts are intended to open the scrolls to “crowd sourcing,” where new insights might come from anyone who studies them online, thereby aiding the work of scholars. Isn’t that amazing? The Israel Museum’s Dead Sea Scrolls are viewable online at : dss.collections.imj.org.il/.
My mother phoned this morning and she was reminiscing about this day, November 22nd, in 1963 when J.F. Kennedy was assassinated. She loved JFK, as so many did. I am exactly the same age as Caroline Kennedy, so what I remember is being sent home from school in the middle of the day, and taking a short-cut through the woods with my sister, in order to get home quickly. It was a cold November day in Montreal and there was so much snow; when we arrived home, we found my mother seated, watching, she had moved the television set into the kitchen so she wouldn’t miss anything…
Photos of the day
November 22, 2011
Swans sit in a boat during the annual collection of Hamburg’s famous ‘Alster Swans’ in Hamburg, Germany. Every year the swans are collected from waterways around the northern German city of Hamburg and taken to winter quarters where they are fed and cared for until the spring. Fabian Bimmer/Reuters.
Market Commentary:
Canada
By Kaitlyn Kiernan
Nov. 22 (Bloomberg) — Canadian stocks rose for the first time in five days as gold shares surged after debt concerns in the U.S. and Europe spurred demand for the metal as a protection of wealth.
Barrick Gold Corp., the largest producer of the precious metal, gained 2.2 percent. Royal Bank of Canada, the nation’s biggest lender, rose 1.1 percent after the Federal Reserve said it discussed monetary easing at its last meeting. Suncor Energy Inc., Canada’s biggest oil and gas producer, dropped 1.7 percent on concern slower growth will hurt fuel demand.
The Standard & Poor’s/TSX Composite Index rose 10.47 points, or 0.1 percent, the most since Nov. 11, to 11,795.19.
“I would call this a directionless market,” Todd Johnson, a money manager at BCV Asset Management in Winnipeg, Manitoba, said in a telephone interview. The firm oversees about C$300 million ($289.6 million). “There are just a lot of uncertainties and unknowns. The politicians in Washington have large difficulty ahead of them and the budget problems will be with us for awhile, while Europe continues to relatively do nothing while bond yields rise.”
The S&P/TSX erased 3.6 percent from Nov. 15 through yesterday as the index had its longest streak of losses since June 8. The benchmark index of Canadian stocks has slipped 12 percent this year and is set to underperform the S&P 500 for the first year since 2003. The Standard & Poor’s 500 Index, the U.S. equity benchmark, has dropped 5.5 percent this year.
Spain’s three-month borrowing costs more than doubled at an auction today, sending two-year yields toward the highest level since 2003, while Belgium’s 10-year bond yields rose to more than 5 percent, adding to concern the euro crisis is spreading. Concern that leaders are running out of options to solve the crisis sent French and Italian yields higher.
U.S. gross domestic product climbed at a less-than-forecast 2 percent annual rate from July through September, down from a previous estimate of 2.5 percent, revised Commerce Department figures showed today in Washington.
Gold rebounded from the lowest in almost four weeks after mounting debt woes in the U.S. and Europe increased demand for gold as a safe haven.
Goldcorp Inc., the world’s second-largest producer of the metal by market value, gained 1.9 percent to C$52.41. Barrick climbed 2.2 percent to C$50.98. Kinross Gold Corp., Canada’s third-largest company in the industry by market value, climbed 5.8 percent to C$13.61.
An index of banks in the S&P/TSX gained 0.3 percent after the Federal Reserve released minutes from their Nov. 1-2 meeting that showed some policy makers said the central bank should consider further economic stimulus.
Royal Bank of Canada rose 1.1 percent to C$44.93. Bank of Nova Scotia, the third-biggest lender, gained 0.3 percent to C$49.94.
Canadian energy companies fell as slowing U.S. economic growth and the European debt crisis increased concern that demand for fuel would slump, while a strengthening Canadian dollar threatened to crimp profits. The Canadian currency rose after a report showed retail sales in the country grew at the fastest pace in a year in September.
Suncor slipped 1.7 percent to C$30.42. Canadian Natural Resources Ltd., the country’s second-largest energy company by market value, dropped 1 percent to C$36.10. Enbridge Inc., Canada’s biggest pipeline company, lost 1.3 percent to C$35.76.
Smartphone maker Research In Motion Ltd., which gets 39 percent of its revenue from the U.S., slid 2.9 percent to C$17.51. The shares had fallen 3.8 percent yesterday after two analysts cut profit estimates and the company reported a glitch that caused some customers to be unable to turn on their BlackBerry Bold devices.
Consumer staples companies also slipped as Saputo Inc. fell 3 percent to C$38.92. Canada’s largest food producer was cut to “market perform” from “outperform” at Bank of Montreal, which cited a 12-month price estimate of C$45 a share.
Shoppers Drug Mart Corp., Canada’s largest drug store chain, slipped 1 percent to C$41.78. Metro Inc., a Montreal- based grocery chain, erased 0.9 percent to C$50.15.
US
By Rita Nazareth
Nov. 22 (Bloomberg) — U.S. stocks fell, driving the Standard & Poor’s 500 Index to its longest slump in almost four months, as slower-than-estimated economic growth overshadowed signs the Federal Reserve may provide more stimulus.
Alcoa Inc. and Bank of America Corp. slid at least 2.1 percent to pace losses in the Dow Jones Industrial Average. The Dow Jones Transportation Average slumped 1.1 percent. Campbell Soup Co. decreased 5.3 percent as the world’s largest soup maker’s sales trailed projections. Netflix Inc., the video- streaming and DVD subscription service, sank 5.4 percent after agreeing to sell $400 million in stock and convertible notes.
The S&P 500 declined 0.4 percent to 1,188.04 at 4 p.m. New York time. The gauge lost 5.6 percent in five days. The Dow retreated 53.59 points, or 0.5 percent, to 11,493.72 today.
“Economic growth remains slow,” John Carey, a Boston- based money manager at Pioneer Investments, said in a telephone interview. The firm oversees about $220 billion. “The evidence is not there that the actions of the Fed and the fiscal stimuli have really helped much. Investors remain concerned about Europe. People are getting concerned as they look into next year and wonder what happens to Europe and what happens here.”
Stocks fell as revised Commerce Department figures showed that gross domestic product climbed at a 2 percent annual rate from July through September, less than projected and down from a 2.5 percent prior estimate. Equities briefly turned higher as some Fed officials said the central bank should consider easing policy further, according to minutes of their Nov. 1-2 meeting.
Benchmark gauges also rose earlier today after the International Monetary Fund revamped its credit-line program to encourage countries facing outside shocks to turn to the fund with few conditions attached, as European leaders fail to end their debt turmoil. Michael Meister, finance spokesman for German Chancellor Angela Merkel’s Christian Democratic party, said “we haven’t any new bazooka to pull out of the bag.”
“The IMF has realized there’s an unresolved issue and they are trying to do what they can to keep this from reaching a liquidity crisis,” Peter Sorrentino, a senior fund manager at Huntington Asset Advisors in Cincinnati, which oversees $14.5 billion of assets, said in a telephone interview.
The Morgan Stanley Cyclical Index dropped 0.8 percent amid concern about economic growth. The KBW Bank Index retreated 1.3 percent. Bank of America lost 2.2 percent to $5.37. Alcoa declined 2.2 percent to $9.26.
Campbell Soup lost 5.3 percent to $31.84. The company reported fiscal first-quarter sales of $2.16 billion, trailing the average analyst estimate by 2.4 percent, according to Bloomberg data.
Netflix sank 5.4 percent to $70.45. Technology Crossover Ventures will purchase $200 million in zero-coupon senior convertible notes due 2018, and T. Rowe Price Associates Inc. funds will buy $200 million in stock. The transactions suggest Netflix’s cash squeeze may last longer than it had anticipated, said Michael Pachter, an analyst with Wedbush Securities. The company needs to spend more to make its streaming content stand out against a growing list of competitors, he said.
Hewlett-Packard Co. slipped 0.8 percent to $26.65 after losing as much as 6 percent following profit forecasts that missed analysts’ estimates. Meg Whitman, who took over as chief executive officer two months ago, used her first earnings conference call to tell investors they need to lower their expectations. The first-quarter profit forecast and full-year earnings outlook both missed estimates — a sign the company is still reeling from a technology-spending slump.
The recent retreat in U.S. stocks, led by banks and brokerages, is signaling more losses through the end of the year, a period in which the S&P 500 usually performs best, according to Bank of America Corp.
Financial shares have posted the worst return this month among the S&P 500’s 10 industries, dropping 9.9 percent through yesterday. The weakness in the group and the benchmark gauge’s decline below 1,200 suggested the index is at risk of sinking to this year’s intraday low of 1,074.77, said Mary Ann Bartels, Bank of America’s head of U.S. technical and market analysis.
“A seasonal year-end rally will likely turn into a Christmas Bah, Humbug,” Bartels wrote in a note to clients yesterday. She sees a 50 percent chance of “a European meltdown” that would send the S&P 500 to as low as 935.
Have a wonderful evening everyone.
Be magnificent!
I often ask myself at what point can a man and a beast that cannot talk recognize each other.
From the early paradise, at the dawn of creation, runs the path where their hearts meet.
Although their connection has long been forgotten,
traces of their continuing association has not been erased.
And, suddenly, in a wordless harmony,
a dim memory awakens and the beast looks on the face of the man with tender trust
and the man casts his eyes upon the beast with an amused tenderness.
It is as if two friends, both wearing masks, meet
and vaguely recognize each other through their disguises.
-Rabindranath Tagore, 1861-1901
As ever,
Carolann
The most positive men are
the most credulous.
-Alexander Pope, 1688-1744