October 21, 2013 Newsletter

Dear Friends,

Tangents:

As Carolann is out of the office this afternoon, I will be writing the newsletter on her behalf.

In the  Condé Naste Traveler’s 2013 Readers’ Choice Awards, Victoria has been rated number 17 as one of the top 25 cities in the world, tied with Sydney, Australia, and Sante Fe, New Mexico.  This year, almost 80,000 people took part in the survey, casting 1.3 million votes, resulting in our beautiful city being rated in the top 25!  Victoria is described by travelers in the magazine as a “beautiful harbor town with great food” and “a pocket of charm and beauty” on the southern end of Vancouver Island.  Some other results saw Victoria rank No. 3 in the Top 5 Cities in Canada, Vancouver Island voted No. 16 for Top 25 Islands in the world, and Vancouver Island voted No. 1 for top Islands in Canada.  Beautiful Tofino also had a number 1 ranking in this year’s award.  Wickaninnish Inn was ranked number 1 in the Top 15 resorts in Canada.  If you are looking for a getaway in the near future, you won’t be disappointed with this resort.

For more information on The Readers Choice Awards 2013, check out: cntraveler.com/ readers-choice-awards.

“The difference between a successful person and others is not a lack of strength, not a lack of knowledge, but rather a lack of will.” – Vince Lombardi

Photos of the Day:

Small rubber ducks are released on a river during a donation drive in Shenzhen, Guangdong province, China. The organizer charged 10 yuan ($1.64) for the release of each duck and raised about 500,000 yuan ($82,050) for several of the cities’ charities on Sunday. China Daily/Reuters

Autumn leaves frame a view of Prague Castle at early morning in Prague, Czech Republic. David W Cerny/Reuters

Market Closes for October 21^st, 2013

International Markets

Bonds

Currencies

Commodities

Market Commentary:

Canada

By Aubrey Pringle

Oct. 21 (Bloomberg) —  Canadian stocks rose for a fifth day, the longest winning streak since May, as a rally among miners on speculation that economic growth will spur commodity demand overshadowed a drop among energy producers.

Detour Gold Corp. and Alacer Gold Corp. each added at least 6.8 percent to pace advances among producers of raw materials.

Maple Leaf Foods Inc. jumped 10 percent as the company said it might sell its 90 percent stake in Canada Bread Co. Athabasca Oil Co. slid 2.9 percent to the lowest since May to pace declines among energy producers.

The Standard & Poor’s/TSX Composite Index rose 50.44 points, or 0.4 percent, to 13,186.53 at 4 p.m. in Toronto.

Trading was 9.5 percent above the 30-day average.

“If you have global growth, companies can make longer-term decisions, which means expansion in production and employment, and therefore everyone’s using more commodities,” Paul Gardner, portfolio manager at Avenue Investment Management, said in a phone interview from Toronto. He helps manage C$300 million ($290 million). “If you have an economy back on track in the U.S., you will have normalized GDP growth, and that’s better for commodities.”

The benchmark Canadian equity gauge has rallied 2.3 percent in the past five sessions, giving it the longest string of gains streak since May that left the index at the highest level in more than two years.

U.S. equities jumped to a record last week after lawmakers ended a 16-day partial government shutdown and reached a debt agreement that averted a default. Data from China showed economic growth accelerated for the first time in three quarters, with gross domestic product gaining 7.8 percent in the third quarter. China and the U.S. are the biggest consumers of commodities and Canada’s largest trading partners.

The S&P/TSX Materials Index jumped 1.6 percent today, the most among 10 groups in the benchmark gauge. Gold producers rallied, as the metal’s price advanced for the third time in four days in New York. Speculation that the Federal Reserve would delay tapering monthly bond buying boosted gold’s appeal as a store of value.

Detour Gold rose 8.9 percent to C$8.08 and Alacer Gold added 6.8 percent to C$2.98.

Endeavour Silver Corp. gained 4.8 percent to C$4.60 as the price of the metal for December delivery jumped 1.7 percent.

Maple Leaf Foods, the Toronto-based maker of meats and packaged goods, surged 10 percent to C$14.63 for the biggest gain in 13 years. The company said it is considering selling its 90 percent stake in Canada Bread.

Bombardier Inc. jumped 4.3 percent to C$5.30, a two-year high, after the world’s third-largest airplane maker said it received 30 new firm orders for its Learjet 85 aircraft from Flexjet LLC.

Montreal-based Bombardier’s share price has risen for four straight sessions amid optimism that the company’s agreement to sell as many as 30 CSeries aircraft to a Chinese leasing company may prompt fresh deals with customers from the Asian nation.

Energy companies slid 0.1 percent as a group, halting a three-day advance, as the price of crude for November delivery dropped 1.6 percent. Inventories increased to the highest level in three months in the U.S., the world’s biggest oil-consuming country.

Athabasca Oil fell 2.9 percent to C$6.09 for its fifth straight drop. The oil-sands developer that began publicly trading in 2010 plunged last week following an Alberta court’s decision to allow an aboriginal group to appeal the provincial regulator’s approval of the company’s Dover project.

Atlantic Power Corp. dropped 5 percent to C$5.16 after the company was downgraded to underperform from neutral at Macquarie Group Ltd.

US

By Nick Taborek

Oct. 18 (Bloomberg) — U.S. stocks rose, giving the Standard & Poor’s 500 Index its best weekly gain since July, as results from Google Inc. topped estimates and speculation grew that the Federal Reserve will delay cutting monetary stimulus.

Google rallied 14 percent to surpass $1,000 a share for the first time after reporting third-quarter sales that beat analysts’ projections.

The S&P 500 added 0.7 percent to 1,744.40 at 4 p.m. in New York, extending an all-time high. The gauge has rallied 2.4 in the past five days, for its biggest weekly advance since July 12.

“People are looking at earnings but they’re also looking at what they think is going to happen next,” Sarah Hunt, an associate fund manager and analyst who helps oversee $4.5 billion at Purchase, New York-based Alpine Woods Capital Investors LLC,said in a phone interview. “After this political problem no one is expecting this to happen again in January. People are just looking for a little bit of a better economic backdrop to continue what’s been a pretty decent environment for stocks.”

The S&P 500 closed yesterday at a record of 1,733.15 after Congress ended the standoff over the federal budget and borrowing authority. The 16-day government shutdown government reduced growth by 0.3 percentage point this quarter, economists said in a Bloomberg News survey.

The slower growth and delayed reporting of economic data will prevent Fed policy makers from paring the monthly pace of asset buying until their March 18-19 meeting, according to the median of 40 responses by economists in the survey conducted yesterday and today. Economists had expected the central bank to reduce purchases to $80 billion last month, according to a Bloomberg survey before the September meeting.

The Fed stimulus has helped propel the S&P 500 up by more than 150 percent from its March 2009 low. The gauge has surged 22 percent this year and jumped to its previous intraday record of 1,729.86 on Sept. 19, a day after the Fed unexpectedly delayed tapering at its last policy meeting.

Investors will have to wait until Oct. 21 to get the next snapshot of economic activity, when data on sales of existing homes is released. The September U.S. jobs report, originally scheduled to be released on Oct. 4, will be issued on Oct. 22.

The report was delayed by the partial shutdown. October employment data will come out on Nov. 8, rather than Nov. 1.

In the absence of economic reports, investors have been watching third-quarter corporate earnings. Thirteen S&P 500 companies released results for the period today. Analysts have raised their forecasts for profits and now forecast an average increase of 2.5 percent for all companies in the gauge, according to estimates compiled by Bloomberg today. That compares with an expected gain of 1.4 percent as of Oct. 11.

Earnings at the 100 companies that have reported so far grew by an average of 4.4 percent, while sales gained 2 percent.

Some 70 percent of the companies have topped analysts’ profit estimates, while 56 percent have beaten on sales.

Gains in the S&P 500 have averaged 1.1 percent in the first four weeks of earnings seasons since 2003, according to data compiled by Bloomberg. That’s about twice the usual four-week gain in the index.

“My concern would be on a very short term basis that some companies are going to use the drama of the past couple of weeks as a pretext to lower the bar,” Matthew Kaufler, a portfolio manager at Federated Investors Inc. in Rochester, New York, said by phone. His firm oversees $363.8 billion. “Even if there is some weakness to forward guidance, I think that’s going to get shrugged off and we’re going to finish the year pretty strong.”

Have a wonderful evening everyone.

Be magnificent!

“Carry out a random act of kindness, with no expectation of reward, safe in the knowledge that one day someone might do the same for you.” – Princess Diana

As ever,

Amanda Bourke

Assistant to Carolann Steinhoff

Queensbury Securities Inc.

St. Andrew’s Square

Suite 340A, 730 View St.,

Victoria, B.C. V8X 3Y7

Tel: 778-430-5808

Fax: 778-430-5838