December 14, 2016 Newsletter

Dear Friends,

Tangents:

The Poem
Sunrise Over Bethlehem

By Ruth Padel

Tell it how you like, it comes to the same
thing: a baby, displaced parents and their midnight
visitors from opposite walks of life.
Shepherds but also kings, the not-so-wise
wise men who brought rich gifts
and triggered a massacre.
All the children of Bethlehem
and the coasts thereof.  The family became
refugees, seeking asylum.
Robin, listen closely in your sleep.
This touches you, doesn’t it?  Christmas
is children, gift-giving, persecution – and lost sheep.

This is an extract of the poem from “Tidings”, published by Chatto & Windus.
PHOTOS OF THE DAY

A woman plays with dogs in a snow-covered park in Vilnius, Lithuania on Wednesday. Mindaugas Kulbis/AP

People enjoy ice skating on the black ice of Lake Seealpsee in Schwende, Switzerland, on Wednesday, with the peak of Saentis in the background. Gian Ehrenzeller/Keystone/AP
Market Closes for December 14^th, 2016

International Markets

Bonds

Currencies

commodities

Market Commentary:
Canada
By Eric Lam
     (Bloomberg) — Canadian stocks fell the most in a month as energy producers dropped with crude and banks retreated from a record after the Federal Reserve raised rates for the first time this year.
     The S&P/TSX Composite Index lost 1.2 percent to 15,197.18 at 4 p.m. in Toronto, resuming its day-long slide after a brief spike higher in the minutes after the release of the Fed decision. The gauge has risen about 17 percent in 2016, the top performer among developed markets tracked by Bloomberg, ahead of No. 2 market Norway’s 14 percent advance.
     Fed policy makers raised the benchmark rate a quarter percentage point following a two-day meeting in Washington. New projections show central bankers expect three quarter-point rate increases in 2017, up from the two seen in the previous forecasts in September, based on median estimates.
     “There is some optimism built into the outlook, as the dot forecast now projects one more rate hike in 2017 than was previously the case,” Avery Shenfeld, chief economist at CIBC World Markets, said in a note to clients. “The higher dot forecast will have markets adding a bit to expectations for rate hikes ahead.”
     Energy producers lost 1.8 percent as a group as all 11 industries in the S&P/TSX fell on trading volume 20 percent higher than the 30-day average. Canadian Natural Resources Ltd. and Encana Corp. declined at least 2.4 percent. Crude futures in New York lost 3.7 percent, retreating from the highest closing price since July 2015. Supplies at the biggest U.S. storage hub at Cushing, Oklahoma rose to a six-month high.
     Royal Bank of Canada and Bank of Nova Scotia slipped at least 0.6 percent to lead lenders lower. North American markets sold off after the Fed’s announcement. Gold fell, erasing earlier gains and sliding to the lowest level since February as the dollar advanced against major peers.
     Raw-material stocks have risen the most among 11 industry groups in the S&P/TSX this year with a 35 percent advance, followed by a 31 percent gain in energy shares. Teck Resources Ltd., Canada’s largest diversified mining company, is up more than five-fold on a resurgence in commodities from metallurgical coal to zinc.
     In other moves:
* Valeant Pharmaceuticals International Inc. lost 3.3 percent after Wells Fargo senior analyst David Maris warned that there may be some “instability” at the drugmaker following the departure of three executives, making the sale of business units less likely; investor Bill Ackman’s Pershing Square also sold shares of the drugmaker for tax-loss purposes
* Merus Labs International Inc. sank 21 percent to a three-year low as fourth-quarter results missed expectations; the company said 2017 will be a transition year, with the second half expected to be “significantly stronger” than the first
* Street Capital Group Inc. surged 17 percent, to the highest close since August 2015, after its subsidiary Street Capital Financial Corp. received a Schedule I bank license from Canadian regulators.
US
By Oliver Renick
     (Bloomberg) — U.S. stocks slipped as all 11 groups in the S&P 500 Index turned negative after the Federal Reserve raised interest rates and forecast a steeper path for borrowing cost increases next year. 
     The S&P 500 Index fell 0.8 percent to 2,253.28 at 4 p.m. in New York after setting a record Tuesday. The Dow Jones Industrial Average dropped 118.68 points to 19,792.53. The Russell 200 Index fell 1.3 percent.
* Financial shares down 0.6% after briefly jumping in the wake of the Fed news
* Tech stocks erase earlier gains as leaders from the industry head to Trump Tower to meet with the president-elect
* Energy shares down 2.1% as crude fell after a report that showed supplies at the biggest U.S. storage hub rose to a six- month high
* Futures traders had priced in higher borrowing costs as a virtual certainty at today’s meeting
* Utilities and consumer-staples stocks had been leading intraday market gains until the hike; ended down 2% and 1%, respectively
** Utilities had climbed 4% in the past week before today as phone shares and staples stocks also rallied; financial and industrial companies were down at least 0.4% in past week
* New projections show central bankers expect three quarter- point rate increases in 2017, up from the two seen in the September forecast
** More on expectations from the central bank here
* For Stephane Barbier de la Serre, strategist at Makor Capital Markets in Geneva, whatever the outcome of the Fed meeting, any signs of dovishness by the central bank would increase the risk of a drop in bond prices
* The recent rally in stocks has sent the Dow to its most “overbought” level since 1996. A pullback for the relative strength index below 70 could spur more declines, according to technical analysis
* The Nasdaq 100 also rallied on Tuesday, reaching a fresh record
* EARNINGS:
** Before market Thursday: Sanderson Farms Inc. (SAFM), Scholastic Corp (SCHL)
** After market Thursday: Oracle Corp. (ORCLE), Jabil Circuit Inc. (JBL), Adobe Systems Inc (ADBE), Quanex Building Products Corp (NX), Enghouse Systems Ltd (ENGH CN)

Have a wonderful evening everyone.

Be magnificent!

The only way to achieve consciousness is by concentrating on the physical, the mental, and the spiritual.
Concentration on the powers of the spirit to discover unity in diversity is called consciousness.
All that draws on unity is moral; all that draws on diversity is immoral.
Swami Vivekananda.

As ever,

Carolann

You can never leave footprints that last if you are always walking on tiptoe.
                                                                      -Leymah Gbowee, b. 1972

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