June 7, 2018 Newsletter

Dear Friends,

Tangents:
On June 7, 1929, the sovereign state of Vatican City came into existence as copies of the Lateran Treaty were exchanged in Rome.
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Paul Gauguin, b. June 7, 1848
Life being what it is, one dreams of revenge. -Paul Gauguin.

PHOTOS OF THE DAY

Edinburgh Castle and the spire of St. Columba’s Church surrounded by ‘haar’ rolling in from the North Sea. Credit: The Telegrap

Lava flows on the outskirts of Pahoa during ongoing eruptions of the Kilauea Volcano in Hawaii. Credit: The Telegraph

Aerial view of farmers working in the fields in Yangzhou, Jiangsu Province of China. Credit: The Telegraph
Market Closes for June 7^th, 2018

International Markets

Bonds

Currencies

Commodities

Market Commentary:
Number of the Day
50%
Jet-fuel prices have surged more than 50% over the past year, pushing carriers to raise fares and Delta Air Lines Inc. to cut its profit expectations.
Canada
By Kristine Owram
     (Bloomberg) — Canadian stocks eked out a fourth straight increase as gains in energy and financials offset declines in most other sectors.
     The S&P/TSX Composite Index added 9 points or less than 0.1 percent to 16,192.78, just over 200 points from its record closing high. Energy stocks were the biggest gainers, rising 1.5 percent as crude prices rebounded to the highest level in a week.
     Consumer stocks retreated due to a couple of negative reports. Saputo Inc. lost 4.3 percent, the most since 2016, after quarterly earnings missed the lowest analyst estimate, while Dollarama Inc. fell 6.7 percent to the lowest since November on the weakest comparable-store sales growth in more than four years.
     In other moves:
                          Stocks
* Canadian Western Bank jumped 8.5 percent, the most since 2009, on strong second-quarter results
* Aphria Inc. lost 5.7 percent after the cannabis producer said it’s offering 19 million shares at C$11.85, below the current trading price
* SNC-Lavalin Group Inc. rose 1.4 percent to the highest since November. It won a contract to design and deliver a C$1.9 billion petrochemical plant in Oman
                         Commodities
* Western Canada Select crude oil traded at a $16.25 discount to WTI
* Aeco natural gas traded at a $1.92 discount to Henry Hub
* Gold rose 0.1 percent to $1,298.70 an ounce.
                         FX/Bonds
* The Canadian dollar weakened 0.3 percent to C$1.2985 per U.S. dollar
* The Canada 10-year government bond yield fell three basis points to 2.28 percent
US
By Sarah Ponczek and Janine Wolf
     (Bloomberg) — A quiet Thursday in June turned turbulent as a rally in Treasury bonds snowballed, shaking up trading desks with a sudden flurry of volume, and a week-long rally in technology stocks was snuffed out.
     Unsettled by currency and stock routs in Brazil and signs of distress in other emerging markets, traders flocked to Treasuries, igniting gains that at one point pushed the 10-year yield down nine basis points in a matter of minutes. Some of the drop was later pared. In equities, the Nasdaq 100 Index fell 0.8 percent, the most in three weeks.
     “Up until about an hour ago this was all okay because the rotation into financials on higher rates was kind of offsetting,” said Tom Essaye, a former Merrill Lynch trader who founded “The Sevens Report” market newsletter. “But with yields lower, financials are basically flat now and techs just weighing, acting like an anchor.”
     Turkey and Brazil intensified efforts to protect their currencies from speculative attacks by investors as emerging markets face their biggest test since the 2013 taper tantrum.
    Turkey surprised analysts by tightening monetary policy Thursday for the third time in less than two months, while Brazil’s central bank sold extra foreign-exchange swap contracts for the second time this week, boosting investors’ protection again further declines in the currency. The lira surged and the real briefly pared losses after the actions.
     After weeks in the doldrums, equities had managed to regain some swagger in recent days. The global expansion narrative had remained intact, Treasury yields were holding below the psychological barrier of 3 percent and U.S. technology shares — the drivers of past rallies — had been notching successive records. Investors will now be watching the G-7 meeting this week for clues on the trade outlook, as well as this month’s meetings of both the Federal Reserve and the European Central Bank to gauge the path of interest rates.
     “The market also continues to be skeptical over any degree of progress made and remains at a point where it is viable to look for opportunity to take profit while it can to justify profit taking in a market that is still defined by improving fundamentals,” said John Stoltzfus, the chief investment strategist of Oppenheimer & Co.,
     The Stoxx Europe 600 Index fell after disappointing data on euro-area exports and German factory orders. The euro had rallied amid talk of an end to the ECB’s quantitative easing program.
     These are some key events to watch this week:
* G-7 Leaders’ Summit starts in Quebec Friday through to June 9.
     These are the main moves in markets:
                           Stocks
* The S&P 500 Index fell 0.2 percent, the Dow Jones Industrial Average gained 0.2 percent and the Nasdaq Composite Index dropped 0.8 percent as of 3:07 p.m. in New York.
* The U.K.’s FTSE 100 Index fell 0.1 percent.
* The MSCI Emerging Market Index slumped 0.3 percent.
* Japan’s Nikkei 225 Stock Average gained for a fourth day, increasing 0.9 percent.
                           Currencies
* The Bloomberg Dollar Spot Index was little changed, after dropped as much as 0.3 percent.  The euro rose 0.2 percent to $1.1799.
* The British pound gained 0.1 percent to $1.3421.
* The Japanese yen strengthened 0.5 percent to 109.68 per dollar.
                           Bonds
* The yield on 10-year Treasuries fell five basis points to 2.92 percent.
* Italian 10-year yields rose 12 basis points to 3.06 percent.
                           Commodities
* West Texas Intermediate crude gained 1.9 percent to $65.96 a barrel.
* Gold rose 0.1 percent to $1,297.34 an ounce. 

Have a great night.

Be magnificent!

As ever,

Carolann

Roots are not in landscape or a country, or a people, they are inside you.
                                                                   -Isabel Allende, b. 1942

Carolann Steinhoff, B.Sc., CFP®, CIM, CIWM
Senior Investment Advisor

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
Fax: 778.430.5828
www.carolannsteinhoff.com