November 20, 2018 Newsletter

Dear Friends,

Tangents:
1910~ Mexico Revolution Day.
On Nov. 20, 1945, 24 Nazi leaders went on trial before an international war crimes tribunal in Nuremberg, Germany. Go to article »

NUMBERS IN THE NEWS:
7,000
Estimated number of migrants from Central America at or near the Mexico-USA border.  Many say they are fleeing poverty and violence in their home countries.

69
Percentage of Americans who say they feel sympathy for immigrants who enter the US illegally.  75% of Republican voters say illegal immigration is a “very big” problem, versus 19% of Democratic voters.

640 Million
Value (in dollars) of luxury goods imported by North Korea from China in 2017, according to a South Korea report.  The trade is in defiance of United nations sanctions, and includes items such as sedans, liquor, watches, and TVs.

2,400
Age (in years) of a 75-foot-long ship found in the Black Sea, 1-1/2 miles down.  It is the oldest intact wreck ever found.  A similar ship is depicted on ancient Greek vases telling the story of Odysseus’ escape for the Sirens.

14
Years that crude oil has been flowing from a damaged well into the Gulf of Mexico.   The cumulative volume of the offshore oil spill – 300 to 700 barrels daily – will soon surpass that of BP’s 2010 disaster.

34.2
Length (in miles) of the Hong Kong-Zhuhai-Macau Bridge, the longest sea crossing in the world, which opened October 23^rd.  Part bridge, part tunnel, the new link is seen by some as Beijing’s bid for more control over autonomous territories such as Hong Kong.

PHOTOS OF THE DAY

A photographer has captured stunning aerial images of the Netherlands by shooting from a helicopter with its door removed. Jeffrey Milstein has gained international praise for his artistic, God’s eye views of urban areas. His latest series focuses on the green-tinged Dutch landscape of Amsterdam and Rotterdam. Credit: Jeffrey Milstein/Cover Images

A big wave surfer drops a wave during a tow-in surf session at Praia do Norte in Nazare, Portugal. Credit: Pedro Fiúza/Nurphoto/SIPA USA

Scotland wakes up to sub zero temperatures as Scandinavian winds bring temperatures to as low as -5. Views here across Loch Ness, Inverness. Credit: Euan Cherry/Wenn
Market Closes for November 20^th, 2018

International Markets

Bonds

Currencies

Commodities

Market Commentary:
Canada
By Tatiana Darie
     (Bloomberg) — Canadian stocks fell for a second day as their U.S. counterparts extended their slide amid a global sell- off in riskier assets led by technology shares. All major benchmarks in the U.S. were down more than 1.5 percent.
     The S&P/TSX Composite Index fell 1.3 percent, with transportation stocks leading the way. Canadian tech shares bucked the trend to rebound on Tuesday while the Nasdaq Composite index fell for a third session.
     The loonie fell against the dollar to trade around the lowest level since late June. CIBC Capital Markets wrote in a report that Canada’s heightened sensitivity to higher interest rates will prevent the central bank from raising borrowing costs much beyond current levels.
Stocks
* Bombardier Inc gained 4.4 percent after reports that the company is the front-runner to win a New Jersey Transit rail car contract.
* Metro Inc fell 0.7 percent ahead of 4Q results before the market open on Wednesday
* Flexible Solutions International Inc fell 2.6 percent despite being upgraded to buy at Greenridge Global
Commodities
* Western Canada Select crude oil traded at a $37 discount to WTI
* Gold fell 0.3 percent to $1,222.20 an ounce FX/Bonds
* The Canadian dollar fell nearly 1 percent to C$1.3302 per U.S. dollar
* The Canada 10-year government bond yield fell 0.7 basis points to 2.345%
US
By Sarah Ponczek and Vildana Hajric
     (Bloomberg) — U.S. stocks fell Tuesday as sinking oil prices hit energy companies, tech hardware continued to plunge with Apple Inc. leading the way, and retailers saw little joy from the coming Christmas shopping season. Treasuries advanced with the dollar and gold fell.
     All major benchmarks were down more than 1.5 percent. The S&P 500 Index briefly slid 10 percent below its September record close before clawing back just above the threshold. The Nasdaq Composite Index was almost 14 percent below the closing high it reached in August. And the Dow Jones Industrial Average shed more than 500 points, or 2.1 percent, as angst spread across global equity markets.
     “The fact that we haven’t seen a fast bounce or hard bounce, shows the market is exploring where prices should be,” Brad McMillan, chief investment officer for Commonwealth Financial Network. “But it’s hopefully a sign that we’re starting to find a bottom here.”
     Investors pointed to escalating trade tensions, signs of a looming slowdown in retail growth and cracks in the credit market as reasons for the decline. Tech hardware was the worst performing group in the S&P 500, followed by transportation and energy as oil slid to its lowest price in more than a year.           The Nasdaq 100 Index fell as much as 3 percent early in the session but retraced almost half the decline during the afternoon. “There’s clearly a concern about a global growth slowdown,” said Alec Young, managing director of global markets research at FTSE Russell. “Not so much in the U.S., but internationally driven. Trade has an impact on the tech supply chain, so it’s impacting the technology sector. The market wants more dovish Fed talk. The Fed has been giving guidance based on the U.S. economy, but in recent months the market has become more focused on the global growth slowdown, and we haven’t heard about that from the Fed.”
Here are some of the equity moves:
* Apple slumped again, down almost 5 percent, bringing its plunge from a recent high to around 24 percent.
* Target Corp. fell 11 percent after its sales forecast disappointed; Kohl’s Corp. and L Brands Inc. also sank on weak earnings.
* Union Pacific Corp. slid 6 percent, its third consecutive decline, while Norfolk Southern Corp. and CSX Corp. both were lower as well.
* Devon Energy Corp. sank more than 7 percent to the lowest since April 2016, and Marathon Oil Corp. lost over 6 percent.
     “There’s a lot of trade fears, a lot of mega-cap tech selling, and it’s one of those things that happens when there’s a correction,” said Dan Miller, director of equities at GW&K Investment. “I’ve seen this too many times before but there’s enough things out there that people are pointing to and it’s created a heavy level of fear.”
     WTI crude slipped below $54 for the first time since October 2017. In bond markets, the yield on 10-year Treasuries fell to the lowest level since September. A credit-default swap index of mostly high-yield issuers in Europe reached the highest in almost two years, signaling renewed nerves about the asset class.
     The sell-off in momentum stocks continued a slump that began last month, with the latest blow coming from renewed concern that demand for Apple’s iPhones has slowed. At the same time, the Trump administration is considering tighter curbs on technology exports, a step that Deutsche Bank AG says would have a “profound and long lasting adverse impact” on relations between the U.S. and China.
     And calls for dip-buying have turned into notes of caution. Goldman Sachs recommended investors hold more cash. Ray Dalio, head of Bridgewater Associates, the world’s largest hedge fund firm, said that investors should expect low returns for a long time after enjoying years of low interest rates from central- bank stimulus.
Coming Up
* It’s a shortened trading week because of the Thanksgiving holiday in the U.S. on Thursday. In addition, Black Friday, the day after Thanksgiving, marks the traditional start to the U.S. holiday shopping season.
These are the main moves in markets:
Stocks
* The S&P 500 declined 1.8 percent to 2,641.89, while the Dow Jones Industrial Average fell 552 points, or 2.2 percent, to 24,465.64. 
* The Stoxx Europe 600 Index sank 1.1 percent, hitting the lowest since December 2016.
* The U.K.’s FTSE 100 Index retreated 1.3 percent.
* Germany’s DAX Index lost 1.6 percent, reaching the lowest in almost two years.
* The MSCI Emerging Market Index dropped 1.7 percent.
* The MSCI Asia Pacific Index slid 1.3 percent, the biggest decrease in two weeks.
Currencies
* The Bloomberg Dollar Spot Index gained 0.5 percent.
* The euro dropped 0.8 percent to $1.1367, the first retreat in more than a week.
* The British pound declined 0.6 percent to $1.2783.
* The Japanese yen fell 0.1 percent to 112.70 per dollar.
Bonds
* The yield on 10-year Treasuries declined one basis point to 3.0537 percent, the lowest since September
* Germany’s 10-year yield dipped two basis points to 0.35 percent.
* Britain’s 10-year yield advanced one basis point to 1.383 percent.
Commodities
* West Texas Intermediate crude slid 6.1 percent to $53.32 a barrel, the lowest since October 2017.
* Gold fell 0.2 percent to $1,221.95 an ounce.
–With assistance from Andreea Papuc and Todd White.

Have a great night.

Be magnificent!

As ever,

Carolann

Money dignifies what is frivolous if unpaid for.
                       -Virginia Woolf, 1882-1912

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