October 31, 2018 Newsletter

Dear Friends,

Tangents:

Carolann is out of the office, I will be writing the newsletter on her behalf.

PHOTOS OF THE DAY

Clouds reflecting in the calm water at Newlyn harbour in Cornwall. Credit: Simon Maycock/Alamy Live News

Swans are pictured ahead of the Turkish Airlines Open at the Regnum Carya Golf & Spa Resort in Antalya, Turkey. Credit: Warren Little/Getty Images

A surfing Prairie Falcon appears to be walking on the wings of a Great Horned Owl in an attempt to ambush it. Credit: Rob Palmer/Caters News Agency
Market Closes for October 31^st, 2018

International Markets

Bonds

Currencies

Commodities

Market Commentary:
Canada
By Tatiana Darie
     (Bloomberg) — Canadian stocks rose alongside their U.S. peers as megacap tech shares that bore the brunt of October’s rout paced the Wednesday rebound. The rally trimmed some of the S&P/TSX Composite index’s losses this month but the benchmark still ended October lower by 6.5%, its worst monthly performance since 2011.
     The S&P/TSX Composite Index rose 0.9 percent on Wednesday, with health care and technology shares leading gains. Telecom shares fell.
Stocks
* Precision Drilling Corp. and Trinidad Drilling Ltd rose 0.3 percent and 0.6 percent, respectively, after the U.S. Federal Trade Commission granted early termination of the waiting period under the Hart-Scott-Rodino Antitrust Act with respect to the companies’ pending deal.
* Methanex Corp rose 0.4 percent after Scotia Capital analyst Benoit Laprade upgraded shares to sector outperform from sector perform.
* Blackbird Energy Inc. was halted after reporting a merger with Pipestone Oil; Haywood analyst Christopher Jones saw potential for selling pressure once BBI CN shares resume given what Haywood believes to be an investor base that has held the name in hopes of a premium takeout scenario.
Commodities
* Western Canada Select crude oil traded at a $43.00 discount to
WTI
* Gold fell 0.6 percent to $1,217.00 an ounce
FX/Bonds
* The Canadian dollar fell 0.3 percent at C$1.3157 per U.S. dollar
* The Canada 10-year government bond yield gained 4.2 basis points to 2.490%
US
By Jeremy Herron and Vildana Hajric
     (Bloomberg) — U.S. stocks rallied for a second day to close out one of the worst months of the bull market on an upbeat note. The dollar added to a 16-month high and Treasury yields jumped. The S&P 500 Index capped its biggest two-day surge since February, paring its biggest monthly decline since 2011 to 7 percent. The Nasdaq 100 Index jumped 2.3 percent, but still fell the most in any month during the bull market. Megacap tech shares that bore the brunt of October’s rout paced the Wednesday rebound, with Netflix and EBay surging more than 5 percent. The FANG cohort rallied after Facebook’s earnings topped expectations.
     Private payrolls data calmed nerves about the strength of the economy, lifting the dollar. Treasuries fell after the government said it will raise the amount of long-term debt it sells this quarter. “People have been skittish over the last month and it’s been pretty volatile, it’s unnerved a lot of folks,” Mike Loewengart, vice president of investment strategy at E*Trade Financial, said in an interview. “When we see a reading today such as ADP, it further illustrates that fundamentals remain sound.” Equity bulls will be hoping this rebound can last following a series of bounces in the past few weeks that quickly gave way to declines as some $8 trillion was wiped off stock markets globally. The MSCI All-Country World Index has dropped almost 8 percent in October, the worst monthly performance since May 2012.
     In Europe, miners and energy companies led the way as almost every sector on the Stoxx Europe 600 Index climbed. Italian bonds bucked a decline as the risk-on mood sent core European debt lower. The euro drifted down as inflation accelerated in October and underlying price pressures increased, handing policy makers a headache after growth data disappointed.
     The pound rebounded after Tuesday’s slump. Corporate results may be key to sustaining the share gains: attention will next turn to earnings from Apple Inc. after the close on Thursday. But there are risks in the background, from the American midterm elections to trade talks with China. 
     Meanwhile, the U.S. jobs report is due Friday — private data surprised to the upside on Wednesday. In Asia, Japanese stocks were the stand-out performers as indexes rose across the board. China’s overnight repo rate surged the most in more than four years as authorities take steps to combat bets against the yuan, which held near the weakest level in a decade against the greenback. The yen edged lower after the Bank of Japan left its monetary stimulus unchanged and kept its 10-year bond yield target at about zero percent.
     Elsewhere, gold fell and oil edged up from a two-month low. In emerging markets, the Indian rupee pared a drop after the finance ministry moved to diffuse growing tensions with the central bank. Developing-nation stocks jumped as currencies edged lower.
Here are some key events coming up this week:
* This week’s earnings season highlights include: Macquarie, Apple, Alibaba, Credit Suisse, Exxon Mobil, and Shell.
* A monetary policy decision is due in the U.K.
* On Friday, the final U.S. jobs report before the November midterm elections may show hiring improved and that the unemployment rate held at a 48-year low.
And these are the main moves in markets:
Stocks
* The S&P 500 Index advanced 1.1 percent as of 4 p.m. New York time.
* The Nasdaq 100 rose 2.3 percent, and the Nasdaq composite added 2 percent.
* The Stoxx Europe 600 Index surged 1.7 percent to the highest in almost two weeks on the biggest jump in seven months.
* The MSCI Asia Pacific Index surged 2 percent to the highest in a week on the largest jump in almost eight months.
* The MSCI Emerging Market Index gained 1.6 percent to the highest in a week on the biggest rise in almost three weeks.
Currencies
* The Bloomberg Dollar Spot Index increased 0.2 percent to the highest in more than 17 months.
* The euro fell 0.2 percent to $1.1322.
* The British pound advanced 0.4 percent to $1.2761.
* The Japanese yen decreased 0.1 percent to 112.93 per dollar, the weakest in almost four weeks.
Bonds
* The yield on 10-year Treasuries increased two basis points to 3.14 percent. The rate at the end of September was 3.06 percent.
* The two-year yield added two basis points to 2.87. It rose from 2.82 percent last month.
* Germany’s 10-year yield advanced two basis points to 0.39 percent. The rate has fallen 9 basis points in October.
Commodities
* West Texas Intermediate crude advanced 0.3 percent to $66.39 a barrel. Oil’s down 9 percent in the month, the most since July 2016.
* Gold futures decreased 0.7 percent to $1,216.90 an ounce. It’s up 1.7 percent in the month.

Have a wonderful evening. 

Be magnificent!

As ever,

Karen

“Success is no accident. It is hard work, perseverance, learning, studying, sacrifice and most of all, love of what you are doing or learning to do.” Pele

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