December 15, 2017 Newsletter

Dear Friends,

Tangents:  Happy Friday!
1891 – Canadian physical educator, James Naismith, Invents the Game of Basketball.

PHOTOS OF THE DAY

The Russian Soyuz MS-05 space capsule lands in Kazakhstan. Three astronauts landed back on Earth nearly six months aboard the International Space Station.

The Geminids meteor shower during its peak, in the night sky over Tokarevsky Lighthouse in Russia.

A boy looks at a rainbow during a sunset in Bogota, Columbia.

Kinkakuji temple is covered with snow in Kyoto, Japan.
Market Closes for December 15^th, 2017

International Markets

Bonds

Currencies

Commodities

Market Commentary:
On this day in 1886, total daily trading volume on the New York Stock Exchange exceeds 1 million shares for the first time.
Number of the Day
-0.9%
The three-month euro-dollar cross-currency basis, where negative numbers denote higher dollar funding costs. The cost of derivatives that allow European investors to access U.S. dollars has rocketed this week.
Canada
By Kristine Owram
     (Bloomberg) — Canadian stocks closed higher but gave up a significant chunk of their earlier gains as energy shares turned south.
     The S&P/TSX Composite Index added 26 points or 0.2 percent to 16,041.98. The market fell 0.3 percent on the week.
     On Friday, the technology index posted the biggest gain, rising 1.4 percent in tandem with its U.S. counterpart. Enghouse Systems Ltd. jumped 5.8 percent after fourth-quarter earnings beat the highest analyst estimate.
     Materials stocks rose 0.6 percent as copper prices jumped 2 percent. Energy shares lost 0.4 percent.
     In other moves:
                         Stocks
* Linamar Corp. jumped 12 percent, the most since 2015. It’s buying agriculture equipment maker MacDon Group for C$1.2 billion
* Torex Gold Resources Inc. added 2.3 percent after employees at its ELG mine voted to return to work
* Ritchie Bros. Auctioneers added 1.8 percent. The company sold more than $50 million worth of equipment in its last Fort Worth, Texas auction of 2017, up 25 percent from the same auction last year
                         Commodities
* Western Canada Select crude oil traded at a $26 discount to WTI
* Aeco natural gas traded at a $1.18 discount to Henry Hub, the narrowest gap in five weeks
* Gold was little changed at $1,254.30 an ounce
                         FX/Bonds
* The Canadian dollar weakened 0.6 percent to C$1.2876 per U.S. dollar after factory sales fell 0.4 percent in October
* The Canada 10-year government bond yield fell three basis points to 1.83 percent, the lowest since July
US
By Eric J. Weiner
     (Bloomberg) — U.S. stocks rallied to new highs and the dollar strengthened as investors grew increasingly optimistic that Congress would reach a deal to cut corporate taxes.
     The S&P 500 Index, Dow Jones Industrial Average and Nasdaq 100 Stock Index closed at records after Republican leaders said they’ll release the final version of the tax overhaul bill Friday evening. A vote is expected next week, with key senators signaling approval. Domestically focused small caps surged to give the Russell 2000 Index its best day since Nov. 16. The dollar gained for the ninth time in 10 sessions as the cuts are expected to bolster the world’s largest economy. Treasury yields were little changed.
     Uncertainty surrounding the fate of U.S. tax reform had investors on edge as they look to the end of a stellar year for equities, with money managers showing signs of dialing back their appetite to take risk. That turned on the final session of the week, with the tax overhaul nearing approval days after multiple central banks indicated optimism in their regional economies.
     “We’ve got investors heading into year-end trying to figure out where they need to make adjustments in their portfolios with the new tax codes coming into effect and also in general we’re seeing global markets continuing their recovery,” said Chris Gaffney, president of EverBank World Markets in St. Louis.
     Aside from the back-and-forth on tax negotiations, a quarterly event known as quadruple witching, when futures and options contracts on indexes and individual shares expire, also added to volatility in the stock market. Volume was 74 percent higher than the daily average in the past 30 days.
     Gold climbed with crude, which continued to trade above $57 a barrel. The Stoxx Europe 600 Index fell. South Africa’s rand gained even as volatility soared before the ruling African National Congress meets this weekend to elect a new leader.
     The euro posted its third consecutive weekly loss as the ECB remained cautious about the prospects of reaching its inflation goals while reiterating a pledge to keep stimulus in place. The pound dropped and yields on U.K. gilts fell to the lowest since September amid speculation Brexit talks are about to get more difficult. Russia’s ruble fluctuated after the nation’s central bank cut rates more than expected.

      This is the key event investors are watching:
* South Africa’s ruling African National Congress meets this weekend to elect a leader to replace Jacob Zuma as party president. The outcome may be known by Sunday.

      And these are the main moves in markets:
                         Stocks
* The S&P 500 rose 0.9 percent to 2,675.63 as of 4 p.m. in New York.
* The Dow gained 0.6 percent, while the Nasdaq 100 added 1.2 percent and Nasdaq Composite rose 1.2 percent. The Russell 2000 jumped 1.6 percent, the most since Nov. 16.
* The Stoxx Europe 600 Index tumbled 0.2 percent.
* The MSCI Asia Pacific Index declined 0.6 percent.
                         Currencies
* The Bloomberg Dollar Spot Index increased 0.4 percent. 
* The euro slid 0.2 percent to $1.1756. 
* The British pound fell 0.8 percent to $1.3319. 
* South Africa’s rand climbed 2.5 percent to 13.1764 per dollar, the strongest in three months.
                          Bonds
* The yield on 10-year Treasuries were little changed at 2.3476 percent. 
* Germany’s 10-year yield declined two basis points to 0.301 percent. 
* Britain’s 10-year yield fell two basis points to 1.15 percent, the lowest in three months.
                          Commodities
* West Texas Intermediate crude increased 0.4 percent to $57.29 a barrel. 
* Gold rose 0.3 percent to $1,256.74 an ounce. 
* Copper gained 2 percent to $3.11 a pound.

Have a wonderful weekend everyone.

Be magnificent!

In his essence, man is not a slave to himself, nor to the world; he is a lover.
His freedom and accomplishments are in love,
which is another name for perfect understanding.
In this ability to understand, in this impregnation of everything that is,
he is one with the Spirit that penetrates everything,
and that is also the breath of the soul.
Rabindranath Tagore

As ever,

Carolann

Do not let what you cannot do interfere with what you can do.
                                                 -John Wooden, 1910-2010

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
Toll Free: 1.877.430.5895
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www.carolannsteinhoff.com