December 2, 2016 Newsletter

Dear Friends,

Tangents:

Blow, blow, thou winter wind,
   Thou art not so unkind
       As man’s ingratitude;
   Thy tooth is not so keen,
   Because thou art not seen,
       Although thy breath be rude.
Heigh-ho! sing, heigh-ho! unto the green holly:
Most friendship is feigning, most loving mere folly:
   Then, heigh-ho, the holly!
       This life is most jolly.

Freeze, freeze, thou bitter sky,
   That does not bite so nigh
       As benefits forgot:
   Though thou the waters warp,
   Thy sting is not so sharp
       As friend remembered not.

                         –William Shakespeare, 1564-1616, As You Like It.

PHOTOS OF THE DAY

People look at a Nutcracker-themed holiday window display at Saks Fifth Avenue in New York on Thursday night. Mark Kauzlarich/Reuters

Members of Sotheby’s auction house staff adjust a painting by Titian entitled ‘Portrait of Two Boys’ (circa 1485-90), said to be of members of the Pesaro family, at a press preview in London on Friday. The painting will be sold at auction on Dec. 7, with an estimated value of 1-1.5 million pounds (1.2-1.9 million USD.) Alastair Grant/AP
Market Closes for December 2nd, 2016

International Markets

Bonds

Currencies

Commodities

Market Commentary:
Canada
By Eric Lam
     (Bloomberg) — Canadian stocks rose as the jobless rate fell with people leaving the workforce, while the nation’s economy added jobs in November, surprising economists who had expected a loss. U.S. hiring also picked up as the unemployment rate tumbled to a nine-year low.
     The S&P/TSX Composite Index gained 0.2 percent to 15,052.52 at 4 p.m. in Toronto, paring a weekly decline. The index has risen 16 percent in 2016, the top performer among developed markets tracked by Bloomberg, well ahead of No. 2 market Norway’s 9.4 percent advance.
     Canada’s unemployment rate fell for the first time in five months in November, to 6.8 percent as people dropped out of the labor force and companies added part-time workers. Employment climbed by 10,700, compared with economists’ expectations for a 15,000 decline, for a fourth straight monthly jobs gain.
     The U.S. meanwhile added 178,000 jobs, just short of the median forecast in a Bloomberg survey of an 180,000 advance. The jobless rate fell 0.3 percentage points to 4.6 percent.
     Energy producers slipped 0.2 percent as a group, paring a fourth straight weekly advance that’s the longest since October. Crude in New York edged higher, trading at about $51 a barrel, as prices surged 12 percent this week after OPEC signaled an agreement to curb oil output. Pipeline company Enbridge Inc. rose 0.5 percent after winning approval from the Canadian government for one of its pipeline projects this week.
     Raw-material stocks added 1.8 percent as gold futures advanced. Zinc headed for its first weekly drop since mid- October, pacing a decline in copper and other industrial metals as a frenzy in trading eased. Natural resource producers are the top-performing industries in the S&P/TSX this year. Teck Resources Ltd., the nation’s largest diversified miner, has surged six-fold to pace gains as metallurgical coal and zinc prices have rallied.
     In other moves:
* Bombardier Inc. added 0.5 percent after winning orders for Tanzania to buy two CS300 jetliners and one Q400 turboprop aircraft for about $200 million
* Turquoise Hill Resources Ltd. retreated 0.7 percent after suspending concentrate shipments to the Chinese border from its Oyu Tolgoi copper and gold mine in southern Mongolia.
Authorities at the border introduced new requirements that are causing long wait times and safety concerns at the border, the company said.
US
By Aleksandra Gjorgievska
     (Bloomberg) — U.S. stocks were little changed near a two- week low after November jobs data delivered a mixed picture on the strength of the labor market as investors assess the Federal Reserve’s plans to raise interest rates.
     Hiring picked up last month while the unemployment rate tumbled to a nine-year low on a drop in the number of people in the workforce and wages unexpectedly declined. The S&P 500 Index rose less than one point to 2,192.05 at 4 p.m. in New York. The benchmark fell 1 percent in the week to cap its first drop since the presidential election.
* The Dow Jones Industrial Average fell 20.82 points to 19,171.11, and the Nasdaq 100 Index ended higher by 0.1 percent.
* Today’s jobs report is the last before Federal Reserve officials announce their policy decision on Dec. 14. Traders are pricing in a 100 percent chance they’ll boost the benchmark rate, up from 68 percent at the start of November.
* Equities rallied in November, with major U.S. indexes posting new highs, as traders speculated president-elect Donald Trump will increase fiscal spending to stimulate the economy.
* Some of the largest U.S. fund managers are skeptical of the rally’s strength. Bill Gross, who runs the $1.7 billion Janus Global Unconstrained Bond Fund, said yesterday such a belief is misguided as the benefits of fiscal stimulus will likely be temporary.
Treasuries rose, the dollar fell and stocks were little changed after the latest jobs report delivered a mixed picture on the strength of the labor market as investors assess the Federal Reserve’s plans to raise interest rates.
     U.S. government bond yields slumped the most in three months, the S&P 500 Index hovered near a two-week low and the greenback dropped against major peers. Brent oil capped its biggest weekly gain since 2009 after OPEC approved its first supply cut in eight years, with attention now shifting to compliance with the deal and how other producers will react to a price rally. Gold futures gained for the first time in four sessions amid signs of political uncertainty ahead of an Italian referendum this weekend.
     U.S. hiring picked up in November, while the unemployment rate tumbled to a nine-year low on a drop in the number of people in the workforce and wages unexpectedly declined, providing a mixed picture of the labor market. The 178,000 gain followed a 142,000 rise in October that was less than previously estimated, a Labor Department report showed Friday. The median forecast in a Bloomberg survey called for a 180,000 advance. The jobless rate fell 0.3 percentage point to 4.6 percent as labor participation dropped for a second month.
     “This is a mixed number, but overall the story for December is unlikely to change,” said Gennadiy Goldberg, an interest-rate strategist at TD Securities LLC. “Given the mixed to weaker print, I think market pricing for 2017 rate hikes could stand to decline somewhat over the near-term.”

* MSCI’s global gauge rose less than 0.1 percent at 4 p.m. in New York.
* The S&P 500 added less than 0.1 percent to 2,191.95.
* Real-estate shares and utilities rose, while financial companies fell.
* The Stoxx Europe 600 Index retreated for a second day.
* Emerging-market shares dropped.

* Oil closed at the highest in more than a year in London and New York.
* Gold pared its weekly loss.
* Palladium slipped, while platinum rallied on the New York Mercantile Exchange.
* Silver gained on the Comex in New York.

* The Bloomberg Dollar Spot Index, which tracks the greenback against 10 major peers, slipped 0.3 percent.
* The pound rallied after the anti-Brexit Liberal Democrats gained a U.K. parliamentary seat in a by-election, a result that may complicate Prime Minister Theresa May’s efforts to begin the process of leaving the European Union early next year.
* The Turkish lira sank to a record low.

* Treasury 10-year yields dropped five basis points to 2.40 percent after increasing on Thursday to the highest since June 2015.
* The Bloomberg Barclays Global Aggregate Total Return Index of bonds fell 4 percent in November, its biggest decline since the index was started in 1990.
* Italy’s 10-year yield was down 15 basis points at 1.90 percent, before the referendum Sunday that has the potential to topple Prime Minister Matteo Renzi’s government.

Have a wonderful weekend everyone.

Be magnificent!

Fear is man’s greatest enemy,
and it manifests itself in forms as diverse as shame, jealousy, anger, insolence, arrogance…
What causes fear?  Lack of confidence in oneself.
Swami Prajnanpad

As ever,

Carolann

In the midst of winter, I finally learned that there was in me 
an invincible summer.
                                                -Albert Camus, 1913-1960

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

Tel: 778.430.5808
(C): 250.881.0801
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www.carolannsteinhoff.com