June 27, 2017 Newsletter

Dear Friends,

Tangents:
June 27, 1980 – ‘O Canada’ is officially proclaimed Canada’s National Anthem.

On June 27^th, 1787, Edward Gibbon wrote in his Autobiography:
Between the hours of eleven and twelve I wrote the last lines of the last page [of The Decline and Fall of the Roman Empire], in a summer-house in my garden  [in Lausanne, Switzerland].  After laying down my pen I took several turns in a berceau, or covered walk of acacias, which commands a prospect of the country, the lake, and the mountains.  The air was temperate, the sky was serene, the silver orb of the moon was reflected from the waters, and all nature was silent.  I will not dissemble the first emotions of joy on recovery of my freedom, and, perhaps, the establishment of my fame.  But my pride was soon humbled, and a sober melancholy was spread over my mind, by the idea that I had taken an everlasting leave of an old and agreeable companion, and that, whatsoever might be the future fate of my History, the life of the historian must be short and precarious. –from The Book of Days.
PHOTOS OF THE DAY

Aerial photo shows flocks of flamingos in Lake Bogoria, Kenya.
CREDIT; IMAGO/BARCROFT IMAGES LONDON.

The Milky Way over the Radar Memorial of St. Aldhelm’s Head, Dorset, UK.
CREDIT: STEVE REGAN/BPNS
Market Closes for June 27^th, 2017

International Markets

Bonds

Currencies

Commodities

Market Commentary:
Canada
By Natalie Wong
     (Bloomberg) — Canadian stocks fell amid declining gold prices and global cyber attacks that weighed on technology shares.
     The S&P/TSX composite index fell 0.2 percent to 15,281.22. Tech stocks tumbled 2.5 percent, the most in over five weeks, as Shopify Inc. dropped 6.2 percent after today’s cyber attacks, following a 2.8 percent decline yesterday following a SunTrust Robinson Humphrey hold recommendation.
     Material stocks sank 1.3 percent as Barrick Gold Corp. fell 1.6 percent and Goldcorp Inc. declined 2.2 percent.
     In other moves:
* Health care fell 2.6 percent as Valeant Pharmaceuticals International Inc. dropped 2.5 percent and Canopy Growth Corp. declined 5.6 percent
* Oil stocks continued a four-day rally, gaining as much as 2.4 percent, the most in five weeks, as Suncor Energy Inc. rose 1.1 percent and Enbridge Inc. moved up 0.6 percent
* Consumer staples advanced 0.7 percent as Alimentation Couche- Tard Inc. gained 5.6 percent, the most in 10 months, after its $4.4b acquisiton of CST Brands won approval from FTC antitrust officials Monday.
US
By Jeremy Herron and Dani Burger
     (Bloomberg) — U.S. equities fell the most in six weeks and a measure of market volatility spiked higher as investors grew uneasy amid a global cyberattack and a fresh setback to the Republican agenda in Washington. Treasuries plunged as Janet Yellen signaled the economy is robust enough to withstand higher interest rates.
     The Nasdaq 100 Index fell more than 1.7 percent to its lowest level since May 19, as investors continue to punish some of the year’s highest flyers. Selling accelerated as the Federal Reserve chair said financial assets had become “somewhat rich.” Financial shares advanced, but not enough to save the S&P 500 Index from its worst drop in six weeks. Treasury 10-year yields rose to the highest in two weeks as Yellen indicated the Fed remains on track to tighten even as data comes in spoke on the economy. Oil climbed above $44 a barrel.
     Senate Republicans delayed a vote on health-care reform in a fresh hit to the Trump administration’s policy agenda, fueling speculation tax cuts and regulatory rollbacks may also be delayed. The International Monetary Fund earlier cut its growth forecast for the U.S. in part because of policy uncertainty, while the latest cyberattack to disrupt global business added to the cautious mood.
     “Market participants may view health care legislation as stalling a move on taxes that could include a repatriation tax holiday,” said Jeffrey Kleintop, Charles Schwab Corp.’s chief global strategist.
     Yellen gave no indication her plans for continued monetary policy tightening had shifted while acknowledging asset prices continued to appreciate. Some investors worry the Fed is taking too rosy a view as it sets the path for increasing borrowing costs, especially after weakness in data Monday added to concerns about the strength of growth. 
     “Yellen is expressing confidence that banking is stronger, economic growth is relatively firm and there’s not going to be a crisis in our lifetime,” said Dennis Debusschere, Evercore ISI’s head of portfolio strategy and quant. “It’s sending a signal that they can continue on rising rates, despite the weaker inflation we’ve seen. That’s where the concern is in the market.”
     Here are some important upcoming events:
* The inaugural session of the new French parliament will start today.
* The Federal Reserve is set to announce the results of the second part of its annual U.S. bank stress test on Wednesday.
* China’s PMI might have declined in June after unexpectedly remaining unchanged in May, reflecting government offers to cut overcapacity and leverage. That reading is due Friday.
* Also due this week: Japanese inflation, factory output, unemployment, household consumption and housing starts; rate decisions in Colombia, the Czech Republic and Armenia.
     These are the main moves in markets:
     Stocks
* The S&P 500 lost 0.8 percent to 2,419.38 at 4 p.m. in New York. That’s the lowest since May 31.
* The Nasdaq 100 lost 1.8 percent, the most since a 2.4 percent rout on June 9. The index is at its lowest level since May 19. Alphabet Inc. dropped 1.9 percent after being hit with a record EU fine.
* The Stoxx Europe 600 Index dropped 0.8 percent, as declines in travel and leisure shares overshadowed the rally in miners.
     Currencies
* The euro surged 1.4 percent to $1.1336.
* The Bloomberg Dollar Spot Index fell 0.5 percent after gaining 0.1 percent in the previous session.
* The British pound added 0.6 percent to $1.2799. 
     Commodities
* West Texas Intermediate crude rose 2 percent to $44.25 a barrel, adding to a three-day rally following oil’s drop into a bear market.
* Gold futures increased 0.3 percent to $1,250.40 an ounce. The precious metal sank almost 1 percent on Monday.
     Bonds
* The yield on 10-year Treasuries rose six basis points to 2.20 percent, after dropping less than one basis point on Monday.
* European government bonds dropped across the board, with the yield on benchmark French bonds climbing 14 basis points and that of Germany gaining 13 basis points.
     Asia
* The Chinese yuan jumped both onshore and overseas amid speculation of central bank intervention.
* Hong Kong’s Hang Seng index fell 0.1 percent and the Shanghai Composite Index advanced 0.2 percent. A string of small-cap Hong Kong stocks suddenly plunged during the day, with traders pointing to links between some of the companies and a brokerage that’s under regulatory investigation.
* Japan’s Topix climbed 0.4 percent to the highest closing level since August 2015.

Have a wonderful evening everyone.

Be magnificent!

Sensibility is the capacity to feel,
recognize, and distinguish the most tiny and subtle changes.
Swami Prajnanpad

As ever,

Carolann

The best time to make friends is before you need them.
                                -Ethel Barrymonre, 1879-1959

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
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