June 15, 2020 Newsletter

Dear Friends,

Tangents:

A woman hatched ducklings from eggs she bought at the supermarket
Can’t tell whether this is cute … or a little terrifying. –CNN.

Interesting stuff From The New York Times today:
“Jon Stewart Is Back to Weigh In” — a new Magazine interview with the comedian.

Poets shared some verses and books they’re turning to right now.

Meet Dalton and Kanaan Dern, of Apopka, Fla. They’ve been skateboarding a lot during quarantine, and you should see the clips.

PHOTOS OF THE DAY

A stunning field of poppies in the Cotswolds at Condicote near Stow-on-the-Wold.
CREDIT: MIKAL LUDLOW PHOTOGRAPHY

A stunning double rainbow of over the valley of New Mills with Crepuscular Rays at sunset in High Peak in the Derbyshire Peak District.
CREDIT: JOHN FINNEY/WENN

A view of Klyuchevskaya Volcano on the Kamchatka Peninsula in the Russian Far East.
CREDIT: YELENA VERESHCHAKA/GETTY IMAGES

Market Closes for June 15th, 2020 

International Markets

Bonds

Currencies

Commodities

Market Commentary:
On this day in 1215, King John of England signed the Magna Carta, enumerating the principles of limited government, free trade, private property and the liquidation of assets to pay debts.
Canada
By Aoyon Ashraf
(Bloomberg) — Canadian equity markets shrugged off earlier losses to end Monday’s session higher, led by a rally in tech stocks. The S&P/TSX Composite Index rose 0.7% in Toronto. U.S. stocks also gained following a Federal Reserve pledge to follow through on corporate bond purchases. Shopify Inc. led the TSX higher after the e-commerce giant inked a deal with Walmart Inc. Cineplex Inc. was the worst performing stock in Canada, slumping 17% as Britain’s Cineworld Group Plc backed out of a deal to acquire the company for C$2.15 billion ($1.6 billion). Meanwhile, Canadian home sales saw a 57% increase in May from the prior month, a small piece of good news in an otherwise frozen market. Transactions for existing properties reached 26,111 in the month, the Canadian Real Estate Association reported. That was still down 40% from a year earlier and at the lowest level for May since 1996. Benchmark prices were little changed. On deals news, Authentic Brands may team up with Simon Property Group Inc. and Brookfield Property Partners LP to acquire bankrupt department-store chain J.C. Penney Co., according to people familiar with the matter.
Commodities
* Western Canada Select crude oil traded at a $7.60 discount to West Texas Intermediate
* Spot gold fell 0.2% to $1,726.70 an ounce
FX/Bonds
* The Canadian dollar strengthened 0.1% to C$1.3574 per U.S. dollar
* The 10-year government bond yield fell two basis points to 0.515%
By Bloomberg Automation:
(Bloomberg) — The S&P/TSX Composite rose for the second day, climbing 0.7 percent, or 103.09 to 15,359.66 in Toronto. Shopify Inc. contributed the most to the index gain, increasing 8.3 percent. Torex Gold Resources Inc. had the largest increase, rising 9.3 percent. Today, 128 of 229 shares rose, while 97 fell; 6 of 11 sectors were higher, led by information technology stocks.
Insights
* This quarter, the index rose 15 percent, heading for the biggest advance in at least 10 years
* The index declined 5.8 percent in the past 52 weeks. The MSCI AC Americas Index gained 5.3 percent in the same period
* The S&P/TSX Composite is 14.5 percent below its 52-week high on Feb. 20, 2020 and 37.5 percent above its low on March 23, 2020
* The S&P/TSX Composite is down 3.9 percent in the past 5 days and rose 4.9 percent in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 19.2 on a trailing basis and 25.5 times estimated earnings of its members for the coming year
* The index’s dividend yield is 3.4 percent on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$2.31t
* 30-day price volatility fell to 20.73 percent compared with 20.78 percent in the previous session and the average of 23.00 percent over the past month
================================================================
| Index Points | | Sector Name | Move | % Change | Adv/Dec
================================================================
Information Technology | 64.3064| 4.7| 5/5
Materials | 41.9743| 2.1| 33/13
Utilities | 16.8703| 2.2| 16/0
Real Estate | 5.5580| 1.1| 20/6
Energy | 5.3956| 0.3| 14/15
Health Care | 3.0510| 2.0| 7/2
Consumer Staples | -0.0504| 0.0| 5/6
Consumer Discretionary | -0.5689| -0.1| 5/9
Industrials | -2.3378| -0.1| 13/18
Communication Services | -11.8727| -1.4| 1/6
Financials | -19.2236| -0.4| 9/17
US
By Katherine Greifeld and Vildana Hajric
(Bloomberg) — U.S. stocks edged higher in volatile trading after the Federal Reserve followed through on a pledge to buy corporate bonds under an emergency lending program. The S&P 500 closed up 0.8% after swinging from loss of as much as 2.5% amid concern about a second wave of the coronavirus pandemic, to a gain of as much as 1.3%. Oil futures rebounded after dropping to less than $35 a barrel as BP Plc warned the pandemic will hurt long-term energy demand. “The initial reaction seems to be that the Fed still has the market’s back even though they expect the economy to be weak for a longer time frame,” said Matt Maley, chief market strategist for Miller Tabak + Co. “The Fed is telling the markets that they want to keep credit spreads under control.” The purchases will be made by the Fed’s Secondary Market Corporate Credit Facility, an emergency lending program that to date has purchased only exchange-traded funds. BlackRock’s iShares iBoxx $ Investment Grade Corporate Bond exchange-traded fund, the largest credit ETF, jumped 1.4%, while the iShares iBoxx High Yield Corporate Bond ETF climbed 1%. The central bank also added a twist to its buying strategy, saying it would follow a diversified market index of U.S. corporate bonds created expressly for the facility. “What appears to be new is the individual buying in the secondary market and what looks like, at least from the announcement, the potential for a wider variety of purchases,” said Dennis DeBusschere, head of portfolio strategy at Evercore ISI. After a fierce rally sent global equities close to their pre-pandemic levels, sentiment in markets had turned negative, with the S&P dropping last week by the most since March. Economic data across the board suggests that the global economy is still weak and there’s no sign that international travel is returning to normal anytime soon.
More than 20 U.S. states are seeing a pick-up in virus cases, and spreading cases in Beijing have also raised concern of a resurgence of the pandemic. The travel ban between the U.S. and Great Britain could persist for months, according to Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases. In China, a string of top-tier data all showed that factory output, consumer spending and investment continued to improve in May, but there are few signs of a broad-based rebound needed to spur a V-shaped recovery. China’s Slow Reboot Points to Hard Road Back for Global Economy Despite the risk-off mood in markets, gold prices slumped, with prices approaching $1,700 an ounce in London. “One thing is leading to the other. Obviously Covid-19, what happened with Beijing this weekend and a couple of states that are seeing a bit of a growth in cases,” said JJ Kinahan, the chief market strategist at TD Ameritrade. “What that really leads to is the fact that if you think about this quote on quote optimism trade that we’ve had over the last couple weeks, the optimism trade really was about businesses getting started, going quickly. If we do have a slowdown in opening businesses, a couple of states have slowed their dates, it’s going to be very difficult for the reality of business to keep up with expectations of a few weeks ago.”
These are some key events coming up:
* Policy decisions from the Bank of Japan, Bank of England and the Swiss National Bank are due this week.
* CBOE plans to open its trading floor, which has been electronic only since March 16.
* Federal Reserve Chairman Jerome Powell delivers his semi-annual policy report to Congress.

These are some of the main moves in financial markets:
Stocks
The S&P 500 Index rose 0.8% to 3,066.59 as of 4:09 p.m. New York time.
The Dow Jones Industrial Average gained 0.6% to 25,763.16.
The Nasdaq Composite Index rose 1.4% to 9,726.02, the largest rise in more than a week.
The MSCI All-Country World Index increased 0.1% to 517.30.
Currencies
The Bloomberg Dollar Spot Index declined 0.4% to 1,210.14.
The euro increased 0.5% to $1.1313, the biggest increase in more than a week.
The Japanese yen was little changed at 107.33 per dollar.
The British pound gained 0.4% to $1.2586, the biggest advance in a week.
Bonds
The yield on two-year Treasuries declined less than one basis point to 0.19%.
The yield on 10-year Treasuries climbed one basis point to 0.71%.
Germany’s 10-year yield fell one basis point to -0.45%, the lowest in more than two weeks.
Britain’s 10-year yield dipped less than one basis point to 0.205%.
Commodities
West Texas Intermediate crude gained 2.2% to $37.05 a barrel, the largest rise in more than a week.
Gold weakened 0.2% to $1,726.52 an ounce.

–With assistance from Claire Ballentine and Lu Wang.

Have a great night.

Be magnificent!
As ever,

Carolann

Treat all men alike.  Give them the same law.
Give them an even chance to live and grow.
                       -Chief Joseph, 1840-1904

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