March 29th, 2011 Newsletter

Dear Friends,

Noteworthy:  On this day, March 29^th, 1999, the Dow Jones topped 10,000 for the first time!

This time tomorrow what will we see
Field full of houses, endless rows of crowded streets
I don’t where I’m going, I don’t want to see
I feel the world below me looking up at me
Leave the sun behind me, and watch the clouds as they sadly pass me by…
-The Kinks, This Time Tomorrow

photo of the day

March 29, 2011

A sparrow pecks a cherry blossom at Yasukuni Shrine in Tokyo, Japan.        Lee Jin-man/AP

Market Closes for March 29^th, 2011

Market Commentary:

Canada

By Matt Walcoff

March 29 (Bloomberg) — Canadian stocks rose, led by banks and energy shares, as investors took advantage of lower prices after the Standard & Poor’s/TSX Composite Index fell near its average level over the past 50 days.

Toronto-Dominion Bank, the country’s second-largest bank, gained 1 percent. Canadian Natural Resources Ltd., Canada’s second-biggest energy company by market value, advanced 1.6 percent as crude futures climbed after three days of losses.

Diamond producer Harry Winston Diamond Corp. rallied 4.5 percent after Bank of Montreal raised its rating on the shares.

The Standard & Poor’s/TSX Composite Index increased 37.62 points, or 0.3 percent, to 13,930.35. The index had fallen as much as 0.4 percent to 13,843.39, approaching the 50-day moving average of 13,811.74.

“There’s a lot of stranded capital that missed most of the rally from the beginning of September that was looking to get in on any pullback,” said Bob Decker, who helps oversee C$5.5 billion ($5.6 billion) as a money manager at Aurion Capital Management in Toronto. “There’s a good technical underpinning given the demand for equities.”

The index had fallen 1.7 percent this month through yesterday after eight-straight months of gains. Uranium producers and insurers dropped after the March 11 earthquake and tsunami in Japan, and energy producers declined from a 30-month high reached at the outbreak of the war in Libya.

An index in a healthy stock market should bounce off moving averages, according to technical analysts, who study charts of trading patterns and prices to predict changes in a security, commodity, currency or index.

The S&P/TSX Banks Index rose for the first time in four days. TD gained 1 percent to C$84.84. Bank of Montreal, Canada’s fourth-largest lender by assets, advanced 0.6 percent to C$62.43. National Bank of Canada, the No. 6 bank in the country, increased 1.4 percent to C$77.30.

Oil producers climbed as crude rose 0.8 percent in New York, extending its 12-month rally to 28 percent. Canadian Natural gained 1.6 percent to C$47.58. Imperial Oil Ltd., the country’s second-largest energy company by revenue, advanced 2.3 percent to C$50.18. Enbridge Inc., Canada’s biggest pipeline company, increased 0.8 percent to C$59.26.

Harry Winston climbed 4.5 percent to a nine-month high of C$14.79 after Edward Sterck, an analyst at BMO, raised his rating on the shares to “outperform” from “market perform.”

In a note to clients, Sterck cited “a robust outlook for rough diamonds and the luxury goods sectors.”

Ritchie Bros. Auctioneers Inc., which calls itself the world’s largest industrial auctioneer, rallied 4.9 percent to a 16-month high of C$26.76 after Ben Cherniavsky, an analyst at Raymond James Financial Inc., boosted his rating on the stock to “outperform” from “market perform.”

BlackBerry maker Research In Motion Ltd. gained 1.9 percent to C$55.65 in Toronto Stock Exchange trading after sinking 13 percent in the previous two days.

Production of Apple Inc.’s iPhones may suffer from parts shortages related to the Japanese earthquake, Andy Hargreaves, an analyst at Pacific Crest Securities Inc., said in a research note. Office Depot Inc. said it will begin selling RIM’s Playbook tablet on April 19.

Potash Corp. of Saskatchewan Inc., the world’s largest fertilizer producer by market value, advanced 0.8 percent to C$55.70 as wheat futures climbed on speculation dry weather in the central U.S. will limit crop yields.

Producers of rare earth elements rallied after the Metal- Pages website reported rare-earth processors in China have had to stop production due to a supply shortage.

Rare Element Resources Ltd., which is developing a rare- earth-elements project in Wyoming, soared 11 percent to C$13.08.

Avalon Rare Metals Inc., which explores for rare earths in Canada, surged 11 percent to C$7.86. Neo Material Technologies Inc., which makes rare-earth and zirconium products, increased 5.1 percent in Toronto Stock Exchange trading to C$8.69.

Yoga-wear retailer Lululemon Athletica Inc. increased 3.3 percent to C$86.87, adding to a record share price, after announcing a two-for-one stock split.

US

By Inyoung Hwang and Cecile Vannucci

March 29 (Bloomberg) — U.S. stocks advanced, sending the Standard & Poor’s 500 Index to a three-week high, as Home Depot Inc. drove consumer companies higher and energy shares rose amid speculation production will increase in the Middle East.

Home Depot rose 2.9 percent, the most in the Dow Jones Industrial Average, as the largest U.S. home-improvement retailer sold $2 billion in bonds to help finance buybacks.

Rowan Cos. and Schlumberger Ltd. rallied more than 4.4 percent as oil gained 0.8 percent. AK Steel Holding Corp. gained 5.2 percent as SAC Capital Advisors LP reported a stake. Apollo Group Inc., owner of the biggest U.S. for-profit college, fell 4.3 percent following lower enrollment.

The S&P 500 rose 0.7 percent to 1,319.44 at 4 p.m. in New York. It rebounded after falling to 1,305.26, compared with yesterday’s 50-day average of 1,306.11, a bullish sign to some traders. The Dow gained 81.13 points, or 0.7 percent, to 12,279.01, three days before a U.S. government report forecast to show non-farm payrolls increased by 190,000 in March.

“It’s hard not to want to be a part of this market when there’s clear economic momentum being driven by the jobs market,” said James Paulsen, chief investment strategist at Minneapolis-based Wells Capital Management, which oversees about $340 billion. “Any other week, these downgrades of Greece and Portugal would knock the market down.”

The S&P 500 fell below 1,306.11 — its 50-day average as of yesterday’s close — at least four times today, and rebounded within three minutes each time, according to data compiled by Bloomberg. The benchmark measure of U.S. shares closed at a 32- month high of 1,343.01 on Feb. 18.

“There are a lot of technical factors also playing out,” Paulsen said. “You’re bowling through the 50-day moving average and zeroing in on a run at whether we’ll get to that 1,345 level” on the S&P 500, he said.

The S&P 500 fell as much as 0.4 percent earlier after S&P reduced Portugal and Greece’s debt ratings, bolstering speculation Europe’s debt crisis will hamper the global economy.

Portugal’s sovereign credit ratings were cut to the lowest investment grade of BBB- and Greece was shifted to BB- at S&P, which said more reductions are possible.

“The market is not surprised by the Portugal and Greece cuts,” said Liam Dalton, president of Axiom Capital Management Inc. in New York, which oversees $1.2 billion. “It’s really more a factor of the market having a sharp move upward and consolidating those gains rather than reacting in a harsh way to the news of Portugal and Spain.”

Home Depot rose 2.9 percent to $37.70 after it sold $2 billion of 10- and 30-year bonds. The Atlanta-based company will use proceeds to replace $1 billion of 5.2 percent notes issued in 2006 that matured March 1 and to buy its own stock, according to a Securities and Exchange Commission filing.

Energy companies in the S&P advanced 1 percent for the second-biggest gain as a group. Baker Hughes Inc. Chief Executive Officer Chad Deaton said Saudi Arabia will deploy more drilling rigs, boosting its count by 28 percent to 118.

Rowan, the U.S. oil and natural-gas driller that also builds rigs, gained 5.2 percent, the biggest increase in the S&P 500, to $43.46. Schlumberger, the world’s largest oilfield contractor, rallied 4.4 percent to $94.36. Baker Hughes, the world’s third-largest oilfield services provider, rose 0.5 percent to $74.16.

Crude for May delivery gained 81 cents to settle at $104.79 a barrel on the New York Mercantile Exchange. Oil has risen 28 percent in the past year.

AK Steel rallied 5.2 percent to $16.42, the second-biggest gain in the S&P 500. SAC Capital, the hedge fund run by Steven A. Cohen, reported a 4.8 percent stake in the third-largest U.S. steelmaker by sales.

Apollo Group plunged 4.3 percent to $40.55 for the biggest drop in the S&P 500. New student enrollment at the University of Phoenix fell 45 percent, compared with the average analyst estimate that called for a 42 percent drop. An index of 13 for- profit education companies in the U.S. tumbled 1.5 percent.

Amazon climbed 3.1 percent to $174.62. It joined the ranks of music-streaming services today by unveiling Cloud Player, allowing users to buy tracks, store them on the company’s servers and play them on computers and Android smartphones.

Apple gained 0.2 percent to $350.96 and Google rose 1.1 percent to $581.73.

Molycorp Inc., the owner of the world’s largest rare-earth deposit outside China, jumped 7.5 percent to $59.65. JPMorgan Chase & Co. raised its share-price estimate to $74 a share from $66, saying a recent increase in domestic rare-earth prices in China point to a healthier market than previously thought.

Starwood Hotels & Resorts Worldwide Inc., the owner of the St. Regis and W hotel brands, gained 3.9 percent to $57.51 after sliding 5.7 percent yesterday. Chief Executive Officer Frits van Paasschen today said at a JPMorgan Chase & Co. conference in Las Vegas the company is seeing strong travel demand, a day after competitor Marriott International Inc. warned of weakness in North America.

Sprint Nextel Corp. fell 3.4 percent to $4.62 for the third-biggest drop in the S&P. AT&T Inc.’s planned $39 billion takeover of T-Mobile USA “still looks doable,” Stifel Nicolaus & Co. said in a note to clients.  Sprint, the third-largest U.S. wireless provider, said this week that the transaction will damage industry competition and called on the government to block it. AT&T, the second-largest U.S. wireless carrier, rose 2.4 percent to $30.05.

Lennar Corp., the third-biggest U.S. homebuilder, tumbled 3.4 percent, the second-biggest drop in the S&P 500, to $19.07 after the Miami-based company posted a 13 percent decline in consolidated orders during the first quarter. That missed the average 2 percent increase expected by analysts, according to Deutsche Bank AG, which estimated a 9 percent drop.

“The market is resilient because investors are realizing that stocks are the more compelling game in town after we’ve moved into a more consistent growth phase in the economy,” said Michael Gibbs, the Memphis, Tennessee-based chief equity strategist at Morgan Keegan Inc., which manages $80 billion.

Have a wonderful evening everyone. Be magnificent!

Life is like a garden.  Quite naturally, leaves wither and flowers fade.

Only if we clear the decay of the past

then and there can we really enjoy the beauty of the new leaves and flowers.

Likewise, we must clear the murkiness of past bad experiences from our minds.

Life is remembrance in forgetfulness.

Forgive what ought to be forgiven; forget what ought to be forgotten.

Let us embrace life with renewed vigor…

We should be able to face every moment of life with renewed expectation, like a freshly blossomed flower.

-Mata Amritanandamayi, 1953-

As ever,

Carolann

I always find it more difficult to say the things I mean than the things

I don’t. -W. Somerset Maugham, 1874-1965