November 4, 2015 Newsletter

Dear Friends,

Tangents:

On this day in 1924, King Tut’s tomb was found.

Also on this day in 1948, T.S. Eliot won the Nobel Prize in literature for his effect on the direction of modern poetry.

The Poem:

Natasha Tretheway writes, “The biologist E.O. Wilson wrote, ‘Homo sapiens is the only species to suffer psychological exile.’  That feeling of disconnection haunts this poem.  Without punctuation, which would separate or halt the fluid movement of thought, the lines seem to connect the past with speakers present longing for what is ineffable.”

After the Voices

   -by W.S. Merwin

Youth is gone from the place where I was young
even the language that I heard here once
its cadences that went on echoing
a youth forgotten and the great singing
of the beginning have fallen  silent
with the voices that were the spirit of them
and their absences were no more noticed
than were those of the unreturning birds
each spring until there were no words at all
for what was gone but it was always so
I have no way of telling what I miss
I am only the one who misses it.

Natasha Tretheway served as the poet laureate of the United States from 2012 to 2014.  W.S. Merwin has written many collection s of poetry, including most recently, “The Moon Before Morning,” published last year by Copper Canyon Press.

PHOTOS OF THE DAY

Sun shines through a Japanese Maple tree at Charles Baber Cemetery in Pottsville, Pa., on Wednesday. The cemetery is the largest green space and also serves as a garden park with tree-lined walking paths, a small spring fed pond and a meditation area. Jacqueline Dormer/The Republican-Herald/AP


A boat makes its way through a sandstorm in the Mediterranean Sea, in Tel Aviv, Israel, Wednesday. A thick sandstorm cloaked the Middle East on Wednesday, clouding skies across the region. In Israel, travel was disrupted for thousands of people when domestic flights to the resort town of Eilat were canceled because of the weather, as the haze shrouded parts of Israel. Sebastian Scheiner/AP


Breeder Siegfried Marth rounds up a gaggle of geese in a pasture in Strem in Austria’s Burgenland province, Wednesday. Marth is raising some 700 geese organically for the traditional ‘Martin Goose’ (Martini Gansl) dinner in celebration of St. Martin each year. The feast of St. Martin of Tours (also called ‘Martini’) marks the time when new wines are tasted, cattle are butchered and geese are at their prime. This feast is celebrated in German-speaking Europe on November 11 usually with a roast goose. Heinz-Peter Bader/Reuters

Market Closes for November 4th, 2015

Market

Index

Close Change
Dow

Jones

17867.58 -50.57

 

-0.28%

 
S&P 500 2102.32 -7.47

 

-0.35%

 
NASDAQ 5142.480 -2.646

 

-0.05%

 
TSX 13661.82 -48.49

 

-0.35%

 

International Markets

Market

Index

Close Change
NIKKEI 18926.91 +243.67

 

+1.30%
 
 
HANG

SENG

23053.57 +485.14
 
 
+2.15%
 
 
SENSEX 26552.92 -37.67

 

-0.14%

 

FTSE 100 6412.88 +29.27

 

+0.46%

 

Bonds

Bonds % Yield Previous  % Yield
CND.

10 Year Bond

1.632 1.615
 
CND.

30 Year

Bond

2.362 2.354
U.S.   

10 Year Bond

2.2250 2.2123
 
U.S.

30 Year Bond

2.9895 2.9960
 

Currencies

BOC Close Today Previous  
Canadian $ 0.76030 0.76543

 

US

$

1.31528 1.30645
     
Euro Rate

1 Euro=

  Inverse
Canadian $ 1.42908 0.69975

 

US

$

1.08652 0.92037
 

Commodities

Gold Close Previous
London Gold

Fix

1114.70 1123.10
     
Oil Close Previous
WTI Crude Future 46.32 47.90

 

Market Commentary:

Canada

By Kate Garber

     (Bloomberg) — Canadian stocks slipped after two days of gains, as a rally in energy producers stalled and Valeant Pharmaceuticals International Inc. resumed its decline.

     The pullback in equities comes amid a slide in global shares sparked by speculation the Federal Reserve is poised to raise rates this year. Data today indicated that Canada’s imports fell for the first time in five months, narrowing the nation’s merchandise trade deficit for September, confirming that the world’s 11th largest economy is finding its footing after lower oil prices shocked the economy in the first half of the year.

     The Standard & Poor’s/TSX Composite Index fell 48.49 points, or 0.4 percent, to 13,661.82 at 4 p.m. in Toronto. The Canadian benchmark equity gauge climbed 1.7 percent in October for its best performance since April, though it trailed gains among 24 developed markets.

     Energy producers in the index fell 0.5 percent after a two- day rally added 3.3 percent, with crude in the U.S. tumbling 3.3 percent to settle at $46.32 a barrel. Valeant lost 5.1 percent after being named as the focus of a probe in the U.S. Congress.

     Information technology stocks led advances Wednesday, as CGI Group Inc. jumped 4.3 percent after an analyst upgrade. Pharmaceutical company ProMetic Life Sciences Inc. led the index with a 9.5 percent gain. Miner First Quantum Minerals Ltd. jumped 3.8 percent for a fourth straight day of gains.

     The trade data was tempered by an announcement from the Petroleum Services Association of Canada on Tuesday that Canadian oil companies will reduce drilling activities next year as crude oil prices struggle around $50 a barrel. Canada’s energy sector is a key component of its economy.

US

By Joseph Ciolli

     (Bloomberg) — U.S. stocks retreated from a three-month high, after data on payrolls and remarks from Federal Reserve Chair Janet Yellen lifted bets that the central bank is closer to raising interest rates.

     Yellen’s comment that December remains a “live possibility” for a rate increase put the brakes on a rally that had carried the Standard & Poor’s 500 Index to within 1 percent of its record. Earnings news also weighed on sentiment as disappointing results from Time Warner Inc. and 21st Century Fox Inc. sent media companies to their steepest decline since August. Energy shares fell for the first time in six sessions. Facebook Inc. rose in late trading following its earnings report after markets closed.

     The S&P 500 slipped 0.4 percent to 2,102.47 at 4 p.m. in New York, after yesterday reaching the highest level since July. The Dow Jones Industrial Average declined 51.18 points, or 0.3 percent, to 17,866.97. The Nasdaq Composite Index fell 0.2 percent. About 7.3 billion shares traded hands on U.S. exchanges, in line with the three-month average.

     “We’ve come back a long way since the end of September, but we’re not going to go straight back to a record,” said Thomas Garcia, head of equity trading at Thornburg Investment Management Inc. in Santa Fe, New Mexico. “Investors are waiting to get more data points this week to assess a potential rate hike in December.”

     Fed Chair Yellen, speaking before the House Financial Services Committee, said an improving economy has set the stage for a December interest-rate increase if economic reports continue to assure policy makers that inflation will accelerate over time. No decision has yet been made on the timing of a rate increase, she cautioned.

     Following Yellen’s remarks, Fed Bank of New York President William Dudley said at press briefing he “completely” agrees with Yellen that December is “a live possibility” for liftoff on rates. Vice Chair Stanley Fischer is scheduled to speak tonight. Traders now price in a 58 percent chance the central bank will increase rates at its December meeting, up from 50 percent yesterday and 34 percent last week before its October gathering.

     As policy makers look for more progress in the labor market, a report today showed companies added 182,000 workers to payrolls in October, signaling steady improvement. Separate data showed the U.S. trade gap shrank in September to a seven-month low, while, according to another gauge, service producers unexpectedly expanded in October at the second-fastest pace in a decade.

     The ADP jobs report today is a precursor to Friday’s government data, in which economists forecast the economy added 182,000 jobs with an estimated 169,000 added to private payrolls. The unemployment rate is expected to slip to 5 percent from 5.1 percent in September.

     Some 24 members of the S&P 500 are scheduled to report earnings Thursday, including Celgene Corp., Walt Disney Co. and Kraft Heinz Co. With 80 percent of the benchmark’s companies now in the books this season, about 74 percent have beaten earnings estimates, while only 45 percent have topped sales forecasts. Analysts estimate profits dropped 3.9 percent in the third quarter, up from predictions for a 6.1 percent decline a week ago.

     Facebook rose 1.8 percent at 4:35 p.m., as it notched another quarter of revenue that beat estimates after stepping up its mobile-advertising efforts. Profit also exceeded analysts forecasts.

     Wednesday’s retreat for the S&P 500 was the first in three days, and follows a 13 percent climb from the bottom of an August selloff that was sparked by China’s surprise currency devaluation. Energy and commodity producers, two of the biggest sufferers in the third-quarter selloff, have paced the rebound.

     The Chicago Board Options Exchange Volatility Index rose 6.7 percent Wednesday to 15.51, up for the fourth time in five sessions and reversing an earlier 4 percent decline. The measure of market turbulence known as the VIX posted its biggest monthly drop ever in October.

     Eight of the S&P 500’s 10 main groups fell, with energy shares the biggest decliners. Consumer discretionary and raw- material companies lost 0.7 percent. Utilities and technology shares were the session’s only gainers.

     Energy companies in the benchmark fell 1 percent amid a 3.3 percent drop in the price of crude oil. It was the resource’s biggest decline in three weeks after government data showed that U.S. inventories climbed.

     Chesapeake Energy Corp. lost 2 percent, paring an earlier 8.6 percent slide, after saying a $5.4 billion writedown in the value of oil and natural gas fields wiped out third-quarter profits, and more charges are coming because the company sees no sign of a rebound in energy prices. Chevron Corp. and Exxon Mobil Corp. lost at least 1 percent.

     Time Warner dropped as much as 10 percent after its 2016 earnings forecast fell short of analysts’ estimates, dragging down other big media companies. Walt Disney Co. dropped 2 percent, while Viacom Inc. lost 6.6 percent. Rupert Murdoch’s 21st Century Fox, which posted lower-than-estimated quarterly revenue, fell 5.2 percent.

     Cerner Corp. dropped 6.8 percent, the most among health- care companies and its biggest drop since August 2011, after the company reported earnings that fell short of analyst estimates. Regeneron Pharmaceuticals Inc. slid 2.4 percent, even after its earnings report came in better than forecast. Pfizer Inc. and UnitedHealth Group Inc. lost at least 1.5 percent to pace declines in the group.                       

     Internet companies were among the session’s best performers, led by gains of more than 2.5 percent in Amazon.com Inc. and Netflix Inc., with Amazon rising to an all-time high. Facebook Inc. rose 1.4 percent before its earnings report, and Google parent Alphabet Inc. added 0.9 percent to a record. The Nasdaq Internet Index climbed 0.7 percent, also to an all-time high.

     Michael Kors Holdings Ltd. rallied 8.3 percent, the most in three months, after the seller of luxury handbags and clothing posted second-quarter profit that topped analysts’ estimates as new retail locations boosted sales.

     Range Resources Corp. jumped 10 percent, the best performer in the S&P 500 and the company’s strongest gain in more than four years, after announcing plans to slash its debt by almost a quarter through the sale of Virginia natural gas wells.

 

Have a wonderful evening everyone.

 

Be magnificent!

We have at the present moment everybody claiming the right of conscience

without going through any discipline whatsoever

that here is so much untruth being delivered to a bewildered world.

Truth is not to be found by anybody who has not got a sense of humility.

If you would swim on the bosom of this ocean of Truth

you reduce yourself to a zero.

Mahatma Gandhi

As ever,

 

Carolann

 

Imagination is the highest kite one can fly.

                    -Lauren Bacall, 1924-2014

 

Carolann Steinhoff, B.Sc., CFP®, CIM, CIWM

Portfolio Manager &

Senior Vice-President

 

Queensbury Securities Inc.,

St. Andrew’s Square,

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7