March 6, 2017 Newsletter

Dear Friends,

Tangents:
March: Candlemas Day came in “fair and bright” and winter certainly “had another flight.”  So the old saying was proved right.  I am pleasantly surprised how many people have mentioned this to me in the past few days.  Here we had two weeks of hard frost in February, which proved to be the exact treatment needed to control the over-precocious bulbs showing an unwonted amount of growth.  However, I was anxious lest the aconites and dwarf iris, already in flower, should succumb.  On the contrary, everything has behaved magnificently.  The aconites have never looked so good for so long, from mid-January until the end of February; the iris have spanned the frosty days, and all the early crocus were held back until the sun came out and the temperature rose enough to entice the bees from their hives. – Rosemary Verey, A Countrywoman’s Notes.

No Matter How You Feel:
Get Up, Dress Up, Show Up, And Never
Give Up.
PHOTOS OF THE DAY

A man collects lotus flowers for sale at a pond in Kandal province, Cambodia on Sunday. Samrang Pring/Reuters

The stork at right chases another stork away from its nest in Biebesheim, south of Frankfurt, Germany on Monday. About 30 storks in the area are now looking for the right partner and nest. Michael Probst/AP

An elderly nun stands and watches the view from Nagi Gomba Nunnery on the outskirt of Kathmandu, Nepal on Monday. Hundreds of nuns from different parts of Nepal study and practice Buddhism in this nunnery, which lies on top of the northern hill in Shivapuri National Park. Niranjan Shrestha/AP
Market Closes for March 6^th, 2017

International Markets

Bonds

Currencies

Commodities

Market Commentary:
Number of the Day
78
The number of trading sessions the S&P 500 has gone without closing at least 1.5% below its 52-week high, the longest such streak since 1964.
Canada
By Lu Wang
     (Bloomberg) — Canadian stocks rose for a second day, reversing earlier losses, as energy shares led a rebound amid an analyst comment that the industry may have fallen too far too fast.
     The S&P/TSX Composite Index added 0.1 percent to 15,629.75 at 4 p.m. in Toronto, after sliding as much as 0.7 percent. Energy, telecom and financial shares rose at least 0.5 percent, offsetting losses among materials and health-care companies. Before Friday, the benchmark index had fallen in six of seven sessions, retreating from a record high amid concern over the country’s trade talks with the U.S.
     David MacNaughton, Canada’s ambassador to Washington, said the nation wants to move quickly with U.S. President Donald Trump to update the North American Free Trade Agreement, as delays and any new border taxes will discourage investment across the continent. The future of Nafta, Buy-American provisions and U.S. House Speaker Paul Ryan’s proposal for a tax on imports have caused concern among investors, he said in a wide-ranging interview on March 3.
     Energy shares, the biggest loser among 11 industry groups this year, advanced 0.7 percent Monday. The group is closing in on oversold territory given a higher-than-normal discount to U.S. peers, TD analysts led by Menno Hulshof wrote in a note.    
US
By Jeremy Herron
     (Bloomberg) — U.S. stocks slipped with Treasuries, while the dollar advanced as caution rippled through markets after Federal Reserve Chair Janet Yellen all but assured investors that interest rates will rise next week. 
     The S&P 500 Index retreated in trading that was 12 percent below the 30-day average. JPMorgan Chase & Co. warned that hawkish Fed rhetoric has increased the likelihood for a short- term pullback after stocks reached records last week. The dollar rose as a surge in corporate bond issuance pushed up Treasury yields. Deutsche Bank AG pulled down European shares after announcing plans to raise capital. Metals slumped on Chinese growth prospects and the French presidential race continued to roil the euro.
     Markets appear to be coming off recent peaks as investors price in a near-certain March U.S. interest rate increase by the Federal Reserve. Chinese Premier Li Keqiang warned of larger challenges ahead during his work report to the annual National People’s Congress gathering in Beijing. In Europe, politics has become the main market driver as election campaigns in the Netherlands, France and Germany put the status quo under threat.
     “The ‘pothole’ is a political one with far-right parties gaining ground in opinion polls ahead of both a Dutch and French ballots in spring,” Luca Paolini, chief strategist at Geneva- based Pictet, said in a research note. “We are scaling back exposure to European stocks, albeit retaining our overweight stance.”
     Read our Markets Live blog here.
     What’s ahead for the markets:
* Mario Draghi probably won’t flinch at Thursday’s ECB meeting even after headline inflation reached its 2 percent target in February. He’s expected to keep QE going until the end of the year with underlying price pressures muted. Other economic highlights of the week are industrial output for Germany, France and the U.K., and German factory orders.
* U.S. jobs data for February are on tap for Friday. Employers probably added around 190,000 workers to payrolls, in line with the average over the past six months and a sign of steady job growth, economists forecast.
* European automakers gather this week at the Geneva Motor Show.
* Philip Hammond’s U.K. budget arrives Wednesday. The chancellor pledged on Sunday to set aside money to cushion the economy from Brexit. 

     Here are the main moves in markets:
     Stocks
* The S&P 500 declined 0.3 percent to 2,375.45 at 4 p.m. in New York, paring a loss that reached 0.6 percent at its lowest in the morning. The index is up 6.2 percent in 2017.
* Ten of 11 S&P 500 groups retreated, led by materials producers and lenders. Energy shares rose.
* The Stoxx Europe 600 lost 0.5 percent, with Deutsche Bank dropping 5.5 percent.
* The Topix fell 0.2 percent as Japan moved to the highest possible alert level after North Korea fired four ballistic missiles into nearby waters. Most other Asian equity markets rose, with the Kospi erasing a loss as Samsung Electronics Co. jumped 1.2 percent.

     Currencies
* The Bloomberg Dollar Spot Index added 0.2 percent, headed for its sixth advance in seven days.
* The euro weakened 0.4 percent to $1.0585, the worst performer among major. The yen was at 113.895 per dollar.
* Mexico’s peso strengthened past its 200-day moving average as the country’s central bank prepared to hold its first $1 billion auction of non-deliverable forward contracts on Monday.

     Bonds
* Treasury yields were higher led by the longest-maturity issues, with the 10-year yield up by about a basis point at 2.49 percent.
* German bonds rose, sending 10-year yields lower by one basis point to 0.34 percent on haven demand.
* French bonds dropped as former Prime Minister Alain Juppe said he won’t enter the race for the Presidency, reducing the chances of anti-euro candidate Marine Le Pen being eliminated in the first round of voting.

     Commodities
* West Texas Intermediate crude slipped 0.2 percent to settle at $53.20 a barrel. Clashes between armed factions in Libya curbed crude output, while U.S. drilling increased.
* Copper futures tumbled 1.6 percent after the biggest inflow of the metal in 15 years to warehouses managed by the London Metal Exchange, according to bourse data released Monday.
* Gold futures slumped 0.1 percent to settle at $1,225.50 an ounce in New York for a fifth day of losses. That’s the longest slump since November.
Have a wonderful evening everyone.

Be magnificent!

Your way is very good for you, but not for me.
My way is good for me, but not for you.
Swami Vivekananda

As ever,
 

Carolann

If you have knowledge, let others light their candles in it.
                                      -Margaret Fuller, 1810-1850

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

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